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State’s job growth may be 2nd highest

Montana’s ability to avoid the harshest effects of the national recession should
allow the state to have the nation’s second fastest-growing economy this year, a national economic
forecasting firm says.

The Billings Gazette Associated Press

The latest prediction from Economy.com shows Montana ending 2002 with employment growth of 1.1
percent, a performance bested only by Nevada with growth of 1.8 percent.
The national economy is expected to end the year with a 0.8 percent drop in jobs, the company said.
Montana’s good showing compared to the rest of the country this year is easily explained, said Paul Polzin,
director for the Montana Bureau of Business and Economic Research.

"The structure of the Montana economy, which held us back during prosperous times, is working in our
favor during this short time when the economy is in recession," he said. "We don’t have the industries most
affected by this recession."
Montana is one of just 14 states that Economy.com expects to show job growth during the year. The
turnaround in most states’ economic fortunes is obvious. In 2001, Montana was among 37 states with some
measure of growth.
But times are changing as this year progresses, and the national economy continues an expected recovery
and Montana continues to slow, the company said.
During the second quarter of the year Montana ranked fifth in the country for job growth with a 1.5 percent
rate. In the third quarter, Montana is expected to place 14th with growth of 0.7 percent. Montana will drop to 27th
during the final three months of the year with a rate of 0.5 percent.
"How far ahead we are is diminishing as the national economy is recovering," Polzin said.
But he cautioned that the forecast is based on the assumption that the national economy does not dip into
a second slowdown or another full-blown recession in the next few months.
If that happens, Montana may not be so lucky in escaping the effects, he said. "Chances are it could hit a
vital spot. We don’t know if there will be a second recession and what industries will he hardest hit."
For example, another downturn could strike the housing market and that would affect Montana’s timber
industry, Polzin said. Tourism businesses also could feel the ripples of a stall in the recovery, because travel is
sensitive to changes in the business cycle, he said.
Copyright 2002 Associated Press. All rights reserved. This material may not be published, broadcast,
rewritten, or redistributed.

Copyright © The Billings Gazette, a division of Lee Enterprises

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