Montana's construction industry has come a long way in the past few years, but University of Montana economist Patrick Barkey says the industry is still feeling the effects of The Great Recession.
"The nature of the last recession was so devastating to home building, to home price appreciation, it really kind of short circuited the whole formula that had fueled economic growth in the last decade. That was going to take a little longer to heal and I'm happy to say that process is well underway."
Barkey, the director of UM's Bureau of Business and Economic Research, says construction wages tell a lot about the industry's overall health and he says there's steady and broad-based wage growth across Montana.
"The big difference is how far these various communities fell when the recession took place. We're talking about all this wonderful growth in Bozeman for example. Their fall from grace, if you will, in the bust was very severe. So, even with that big growth they've had for about 2-and-a-half years, they're still a long ways behind from where they were before."
The construction sector in Montana's oil patch counties has been strong throughout the oil boom, but Barkey's hesitant to predict how long that may last:
"From the data we have, we don't yet see any catastrophic impacts of the decline in oil prices from where they were a year ago - cut by anywhere from 50 percent to 60 percent - but really that reveals the inadequacy of our data. We are certainly hearing plenty of reports of construction projects being halted and of workers moving, but we haven't yet seen them show up in the data. We expect some of them will be."
The U.S. Commerce Department says nationally, construction spending rose almost 14 percent over the past 12 months.
This story was updated on 09/02 with additional information from Mr. Barkey, and a link to a Montana construction wages growth graph.
