Jobs change with times in Great Falls

Industrial economy gives way to retail, service sectors pay

In the 20 years since the demolition of the Big Stack — the symbolic end of the bountiful Anaconda Co. era — the Great Falls economy experienced what may go down in history as its most dramatic change.

By BETH BRITTON
Tribune Business Editor

In two decades, the Electric City was transformed from a city where better-than-average, blue-collar jobs ruled to a city ruled by, and dependent on, the lower-paying service industry.

Gone are the smelter, brewery, railroad, slaughterhouse and iron works jobs that seemed to define Great Falls for so many years. In the decade leading up to the stack’s demolition in 1982, the city lost about 2,600 good-paying jobs.

They’ve been replaced by the hotel, food service, retail, medical, legal and finance-related jobs that characterize the city’s employment rolls in 2002.

"When the refinery was open, Great Falls was definitely a manufacturing town, with relatively high union rates and high wages — the things that go along with a manufacturing community," said Paul Polzin, director of the Montana Bureau of Business and Economic Research. "Now it’s much more of a retail trade and service economy."

The unemployment rate is down, but so are many of the wages.

The number of service-related jobs is up, but so is the number of people working more than one job to make ends meet.

"There has been a trend toward lower-paying jobs in the service sector, and that’s something that’s very tough on individuals. They have to take two or more jobs," City Manager John Lawton said. "That heavy-industry layer was a big part of the economy, and that whole layer just disappeared."

Roughly 10 percent of Montana’s civilian labor force — about 48,000 workers — has multiple jobs, according to Montana Department of Labor and Industry statistics. In 2000, 9.8 percent of working Montanans had more than one job. That number has hovered in the 9 percent to 10 percent range for the past decade.

Other states appearing near the top of that list are North Dakota, South Dakota, Nebraska, Minnesota and Wyoming — not surprisingly, all farm states: Ag workers tend to work another job when the weather turns harsh.

"It isn’t always low-skilled single mothers that have three jobs. That’s certainly a portion, but my best guess is that it’s due in part because of agriculture," Polzin said. Plus, teachers and education officials often take second jobs when school is out, so they, too, factor into the equation, he said.

A growing, changing economy

Losing the Anaconda Co., which by then had merged with Atlantic Richfield, was a major turning point in the whole state’s economy, said Bob Rafferty, head of research and analysis for the Montana Department of Labor & Industry.

"It hurt us. You can see where wages turned and unemployment went up," Rafferty said. "That’s the company that held us up with high wages. For the most part, we were a one-company town, and it’s probably not good to be so company dependent."

Cascade County experienced a loss, but Silver Bow and Deer Lodge counties were hit harder, he added. Great Falls fared better than Anaconda or Butte because the Electric City’s economy was slightly more diversified, he said.

Lawton argues that Great Falls’ economy is no worse than it was 20 years ago; in fact, he says, it’s grown.

"The economy’s not worse off, but things have replaced the industrial," Lawton said. "The types of jobs have changed."

According to U.S. Department of Commerce statistics, total personal income in Cascade County rose from slightly less than $329 million in 1970 to well over $1.9 billion in 2000. More telling than the increase in income is the percentage earned in various industries.

Jobs in manufacturing accounted for 7.4 percent of all income in 1970 but only 2.1 percent in 2000. Transportation and utility jobs accounted for 6 percent in 1970 and 3.5 percent in 2000. Retail fell from 10.8 percent to 7.6 percent, but services — including health, legal and hotels — took a significant jump, to 18.8 percent in 2000 from 12 percent in 1970.

The problem is, many of those jobs don’t begin to provide the salaries or benefits comparable to the ones blue-collar workers earned before they found themselves out of work in the early 1980s.

"The smelter was a good, stable longtime employer that paid good wages and had good fringe benefits," said economist Phil Brooks of the Montana Department of Labor and Industry. "When that company closed its doors, there just were not the high-paying jobs for that work force, the blue-collar work force."

Those who chose to stay in Great Falls "went into jobs that didn’t pay as much money," Brooks said. "They were second- and third-generation workers with deep roots and were not likely to relocate."

The psychology of work also changed. Gone is the "cradle-to-grave" mentality, where employees expect to spend their entire working life at one company.

When "The Company" pulled out, "it really changed one of the fundamental, underlying principles of Great Falls," he said. "It was pretty much a union town, and (the smelter) was the last real bastion of organized labor in the city."

Today, "Great Falls is an interesting anomaly. There is a large number of very good-paying jobs in Great Falls, but there’s not a lot of middle management," Brooks said. "You either have people making very good money, or …"

A familiar phenomenon

Great Falls’ transformation into a service economy is a familiar story in Montana and nationwide, said Tim Ryan, former director of High Plains Development and now Montana USDA Rural Development director.

"It’s more obvious in Great Falls, because you don’t have the other things going on," Ryan said. "There are more diversified economic portfolios elsewhere, and the one largest component in Great Falls is (Malmstrom Air Force Base)."

When the smelter closed, the local economy became even more reliant on the base and on ag, he said.

"A lot of what’s happened in Great Falls is a reflection of what is happening nationally," agreed former Mayor Joan Bennett. "But I don’t recall people being embittered or discouraged. The underlying optimism is still there."

In the late ’60s and throughout the ’70s, when the city was home to those high-end blue-collar jobs and farmers and ranchers were enjoying high cattle and wheat prices, Great Falls auto dealers sold up to 7,000 new cars a year, recalled her husband, Dick Bennett of Bennett Motors.

Today, even with a comparable population, that number is closer to 3,000, he said. The number of employees at the company his father, Carroll Bennett, started in 1916 now is about half of what it was right before the smelter closed.

What happened to Great Falls’ economy during the past 20 years wasn’t what some people had expected.

"It’s ironic, because in 1970, when I first got here, I remember sitting and hashing out regions in Montana, trying to decide what was in store and which areas would grow faster," Ryan said. "I thought it would be Great Falls, because, compared to Billings, it had a diversified industrial base and served as a service center."

That didn’t happen. Billings’ growth outpaced Great Falls, in part because the recession of the mid-’80s and the overall decrease in nonfarm income at that time were as devastating to Great Falls as the smelter’s closure, Ryan said.

Social impact

The economic changes that brought about the transformation to a service economy have brought social changes, too.

The number of people seeking assistance from Opportunities Inc. increases every year, said its director, Les Stevenson.

"The last 20 years, we’ve seen a decline in sustainable-wage jobs, and as each year goes by, Opportunities Inc. has seen more and more people who are working minimum wage or near minimum wage without benefits, and some of them are working more than one job," Stevenson said. "They are getting by as long as nothing out of the ordinary happens to get them off budget."

Ten or 20 years ago, most of the people seeking assistance were chronically unemployed. Today, most people have jobs, but raising children and paying bills on minimum wage paychecks — even two or more in one household — is easier said than done, he said.

"There’s still the attitude by a few that all these people need to do is get a job, but those jobs aren’t providing adequate income for them," he said. "These are people in dire situations where something is happening beyond their control."

The increasing number of low-paying jobs also makes parents unable to fund their children’s extracurricular education or save for emergencies and retirement.

"It limits the exposure and opportunities of youth," Stevenson said, pointing to the costs associated with activities such as sports, arts and music programs.

"We have in our society people who will never be totally self-sufficient, but the ones your heart can go out to are the ones doing everything they can to provide for their families," Stevenson said. "For someone who prides themselves on working, to have to come and ask for help with rent or groceries — it’s a humbling experience for them."

A new attitude

The miracle is that Great Falls has recovered from the loss of the Anaconda Co., is growing and has bright prospects, Lawton said.

"Things aren’t like they used to be. They just aren’t, and we have to get used to that and focus on the future," he said. "I think it’s a positive story."

Today, Great Falls is well established as a regional shopping and medical services center. In fact, nine of the top 15 private employers are health care and retail establishments.

Great Falls businesses and medical institutions attract patients and customers from throughout the state. But local economic development officials acknowledge there also must be growth in other areas, including manufacturing.

The Great Falls Development Authority is working to attract primary sector jobs — those that bring new wealth into the community.

What the transformation to a regional center takes is a change in attitude, Assistant City Manager Cheryl Patton said.

"Great Falls had a ‘poor me’ attitude when the smelter closed," Patton said. "I think a lot of people felt that part of Great Falls died when the stack came down, but others thought it was a relic, and they looked to the next phase of the town, which is to continue to expand as a regional center."

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