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Housing crisis curtails Montana’s economy

by Daily Inter Lake
| October 2, 2022 12:00 AM

Federal Reserve Chair Jerome Powell earlier this month described the curious national labor market as being simply “out of balance,” as the demand for workers continues to substantially exceed supply.

The latest data is concerning. At one point this summer the ratio of job openings to job seekers nationally was 2:1, with some 11 million openings in July.

And despite new signs of a shrinking economy and possible recession, the air-tight labor market still plagues businesses across all sectors that are looking to hire, not fire.

Montana is no exception, where the unemployment rate is hovering around 2.8%. As of Sept. 25, there were more than 23,000 job openings in the state, which ranks tenth nationally, according to the Montana Department of Labor and Industry. In Flathead County, there were 1,536 jobs posted.

Not surprisingly, local employers that attended last week’s Northwest Montana Job and Opportunity Fair in Kalispell confirmed the hiring challenges, and agreed that the area’s worsening housing crisis remains among the most pressing recruitment obstacles — ultimately holding back Montana’s full economic potential.

“There’s not enough candidates in the valley, and there are plenty of people wanting to come here, but there’s just not enough housing,” said Bryan LaFontaine, director of food and beverage at Averill Hospitality. The Whitefish-based company owns The Lodge at Whitefish Lake, the Firebrand Hotel and has proposals to build two additional hotels in the resort town.

LaFontaine’s concerns are well placed. A recent housing assessment in Whitefish shows that the city needs to add more than 1,300 homes in the next eight years to keep up with demand, and that at least 75% of those homes need to be priced below market rate.

The study’s results offer a dire outlook for businesses that depend heavily on service industry and seasonal workers who can’t afford to live in the valley.

Challenging times call for creative measures, and it’s encouraging to see Averill Hospitality among the local companies that are taking matters into their own hands. LaFontaine noted the Whitefish hotelier has plans to construct up to 500 units for employee housing to ease the crunch.

Similarly, officials with Blacktail Mountain in Lakeside note that the ski area is planning to lease a group of cabins to some winter employees, while it also maintains a housing database for potential workers.

Backslope Brewery in Columbia Falls was among the early adopters of this type of self-sustaining employee housing initiative, with the company building a pair of dorm-style rooms adjacent to the restaurant for its employees who might not have anywhere else to go.

Whitefish Mountain Resort and Xanterra also offer some worker housing in the valley.

Gov. Greg Gianforte’s recently appointed housing task force is due to offer its initial findings later this month, and we look forward to poring over the results from this group of bipartisan stakeholders. In the lead-up to their report, they would be wise to look to the employee housing initiatives developed by Flathead Valley businesses as one remedy, while considering incentives to spur similar projects across the state.

Make no mistake, stamping out the housing crisis is going to take a multi-pronged approach, with public, private and public-private solutions all playing a role.

The employee housing solutions cropping up locally are certainly welcome and represent one promising move toward a more stable and sustainable economy for the region.

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