Eastern Plains Economic Development Corporation

…providing support for a better economy.

Evolving Economics

Passage of the Enlarged Homestead Act of 1909 attracted tens of thousands of homestead farmers into Montana in search of inexpensive land. Farmers were rather well-off until an extended drought and a drop in market prices after World War I ruined them economically. The homestead "bust" forced many farmers to leave the state.

Montana's post-World War I depression extended through the 1920s and right into the Great Depression of the 1930s. With FDR's "New Deal," came the formation of various projects and agencies that benefited the state and marked the first real dependence of the state on federal spending in the 20th century. From 1945-2000, "modern" Montana was characterized by a slow shift from an economy that relied on the extraction of natural resources to one that was service-base, while agriculture remained Montana's primary industry. This era also witnessed the state's transportation system move from a heavy reliance on railroads to more convenient cars, trucks, and highways. Economic and major technological advancements also occurred during this period.

Historically, ups and downs in the economy have been caused by escalating oil prices, sharp increases in interest rates, and drought conditions which led to decreased livestock numbers and irregular prices for agricultural commodities. The enrollment of farm land into the federal CRP program in the mid-1980s, followed by low commodity prices in the mid-1990s, coupled with rising input costs and poor weather conditions, drastically cut into the financial health of Montana's farm economy. Now, rural Montana faces an even greater challenge as the median age of farmers and ranchers rises, while children leave to pursue more lucrative job opportunities elsewhere.

In February 2006, Montana Governor Brian Schweitzer announced that, "Economic development in central and eastern Montana is a priority." Schweitzer reported that seven years of extreme drought had resulted in regional socio-economic treads comparable to the "dustbowl era" of the 1930s. These socio-economic trends included an aging and declining population, wage and salary income that was both depressed and stagnant, a high prevalence of poverty, and an increased reliance on federal farm subsidies for farm income.

After this significant period of overall decline and stagnation, an upsurge in activity began to occur in 2008 due to technological advances that allowed for increased oil and gas extraction in northeastern Montana and western North Dakota. An economic "boom" that is both a blessing and a challenge, as good paying jobs become more readily available, business owners benefit from increased sales, and county tax revenues begin to grow. All while strain is placed on aging infrastructure, cities and towns face unforeseen planning and development issues, and housing demands force citizens and communities to deal with a steep rise in the cost of living.