Montana companies that deal in high technology generated more than $2 billion in revenue last year and continued to grow nine times faster than the state’s overall economy, a new University of Montana study found.
Released this week by the Bureau of Business and Economic Research, the study also found that Montana’s high-tech firms now pay more than double the median earning of other state workers.
Boil it down and it’s the third highest-paying industry in the state.
“We’re pleased that we hit that $2 billion mark – it’s phenomenal news for Montana,” Christina Quick Henderson told the Missoula Current. “Just a couple years ago, we were excited to surpass $1 billion. It’s surprising that it’s climbing that fast. After five years, it just keeps getting better.”
Henderson, executive director of the Montana High Tech Business Alliance, believes a number of factors have contributed to the industry’s rise, including more entrepreneurs taking the plunge and starting their own business.
After several years in the Kauffman Foundation’s top rankings for entrepreneurial activity, Montana also has landed on the radar of outside investors. Last year, onX in Missoula netted a $20 million capital investment and ATG was acquired by Cognizant, a Fortune 200 company valued at roughly $42 billion.
“There’s more investment than ever before from outside the state in Montana companies,” Henderson said. “All those new companies investing in Montana is adding to that bottom-line revenue and it’s creating high-paying jobs for Montanans.”
Henderson said that has broader implications for the state’s larger economy.
“In addition to it being great news for those looking for jobs in the high-tech industry, it also is good news to the rest of the Montana economy,” she said. “Those folks can use those wages to put their kids in school here, buy houses and invest in other ways in their community.”
The study also found that members of the Montana High Tech Business Alliance continue to grow, employing around 7,500 workers with an average annual salary of $65,000. Montana’s high-tech companies expect to increase wages by 5 percent this year, well beyond the 3.2 percent growth of other state employers.
“It’s been a wild ride for eight years, and then we got acquired by a $42 billion company,” said Tom Stergios, senior vice president of strategy and corporate development at Cognizant ATG. “Everything from what that means for Missoula and what that means for ATG, and what it means for the broader state of Montana and all the ATG employees around the country, it couldn’t be more exciting.”
Members of the alliance, itself just five years old, expect to make at least $125 million in capital expenditures at their Montana facilities this year, a recent survey found. That represents a significant increase over projected expenditures of $86 million last year.
Henderson would like to see industry expand next year to $2.5 billion in revenue.
“Some of the companies now creating some of those jobs and revenue didn’t even exist five years ago,” she said. “I’m really optimistic the companies currently investing in Montana will keep scaling up. I think we’ll continue to see that trajectory rising again next year.”
For the fifth year in a row, the survey also found that Montana’s quality of life provided significant advantages to doing business in the state. The quality of the state’s emerging workforce also served as an advantage to growth, respondents said.
“Considering disappearing traditional industries within Montana, and the upside to Montana’s economy and workforce, advancing technology should be an absolute priority for the future by Montana residents, businesses and decision makers.” said Jeffrey Heng, vice president of technology for AXIOM IT Solutions in Missoula.