Montana’s manufacturing sector continues to play a key role in the state’s economy, according to three new reports released by the Montana Manufacturing Extension Center (MMEC) at Montana State University. The studies, authored by the Bureau of Business and Economic Research at the University of Montana, show that manufacturing generated over $2 billion in base labor earnings in 2024, making it the second-largest sector after hospitality.
“Manufacturing continues to be a strong and resilient sector of the Montana economy,” said Paddy Fleming, MMEC director. “Despite recent economic uncertainties, our manufacturers continue to innovate, invest in expansions and automation, and keep upbeat about the future.”
The reports note that while manufacturing has grown faster than the national average since 2020—largely due to gains in durable goods—the sector began to slow down at the end of 2024 and into early 2025. This was attributed mainly to declines in wood products and food production. The executive summary states: “Manufacturing has expanded faster than the nation since 2020, driven by growth in durable goods, but the sector began to cool in late 2024 and early 2025 with declines in wood products and food production. Establishment growth over the past decade highlights entrepreneurship and diversification, though recent closures mark the first broad contraction in years. Exports rebounded strongly in 2024, led by petroleum and transportation equipment, while workforce shortages and rising input costs continue to challenge manufacturers.”
Fleming explained that this slowdown was anticipated after several years of rapid expansion. “Given the impressive expansion of the number of manufacturers in Montana since 2017, which exceeded the national growth numbers, it is only expected that we would see a slight slowdown in that expansion rate,” he said. “Montana’s manufacturing took a hit with the lumber product shutdowns at Seely Lake, Missoula and Bonner. But there is significant expansion planning going on with our existing manufacturers, and there remains strong interest in out-of-state and out-of-country manufacturers relocating to Montana.”
The MMEC operates from MSU’s Norm Asbjornson College of Engineering and has provided support services for nearly three decades to improve business operations for manufacturers across Montana. These services include connecting businesses with university labs and research centers as well as offering student internships.
Other findings from the reports include:
– Real gross domestic product from Montana manufacturers reached $3 billion.
– Since early 2020, manufacturing GDP growth outpaced national rates by 7%.
– Exports increased by 10% during 2024.
A survey included within one report indicated that many Montana manufacturers experienced slower business activity last year along with lower capital investment levels and persistent labor shortages. However, most respondents expect modest growth for 2025.
Another report focused on MMEC’s impact found that its services helped create or retain 642 jobs statewide last year. Additionally, these efforts resulted in almost $61 million in revenue gains for companies served by MMEC, more than $39 million invested back into businesses, and $22.8 million saved through cost reductions.
“MMEC’s services provide a four-to-one return on investment to the state government, based on a calculation of how much income tax collections increase as a result of these services,” according to one report.
The MMEC serves as a statewide resource center for manufacturing expertise and training aimed at helping local companies stay competitive through operational improvements and workforce development initiatives.
