Missoula recently ranked ninth on the Milken Institute’s annual list of the Best-Performing Small US Cities. This places Missoula among notable peers like Bend, Oregon; St. George, Utah; Idaho Falls, Idaho; Jefferson City, Missouri; Coeur d’Alene, Idaho; and Jacksonville, North Carolina. These are smaller metros with populations typically under 275,000, recognized for strong performance across economic, quality-of-life, and resiliency indicators.
The Milken Institute is a nonprofit, nonpartisan think tank focused on advancing economic growth and improving lives through policy research, data analysis, and convening global leaders. Its Best-Performing Cities index evaluates metropolitan areas based on factors such as job creation, wage growth, and high-tech industry presence, highlighting regions that demonstrate strong economic and social resilience.
Economic Growth and Business Appeal
This ranking highlights Missoula’s achievements and potential as a community offering conditions that attract businesses and individuals. While businesses may not directly reference such rankings in their relocation and expansion decisions, they reflect a foundation of economic growth, job creation, and quality living conditions that make Missoula an appealing option.
Strong Job and Wage Growth
One key factor driving this recognition is Missoula’s exceptional job and wage growth, placing the city in the top quarter on these metrics. During the pandemic, the city saw minimal job losses and a swift recovery. Consistent employment growth over the past decade has created a rich, diverse economy. In 2024 the region took a hit as several lumber mills shut down. Despite this, the Missoula metro still added new jobs throughout 2024 that made up for these losses. Notably, one of the shuttered mills was quickly sold to a new company in the entertainment industry.
High-Tech Sector Expansion
Missoula’s high-tech sector also contributes significantly. Between 2018 and 2023, Missoula ranked second in high-tech GDP growth. This growth has created better-paying jobs and attracted new talent to the area. While high-tech expansion has slightly slowed recently, continued investment in areas like the state’s photonics investments promises future growth.
Missoula also scores highly in resiliency, defined by its ability to withstand and recover from challenges like natural disasters. The city benefits from a relatively low risk of catastrophic events compared to coastal areas, which face increasing costs and disruptions due to climate-related disasters. Missoula’s proactive planning, social infrastructure, and low-density development in high-risk areas further enhance its resiliency.
Resilience and Risk Mitigation
Resilience is likely to become a critical factor in business location. Recent natural disasters in coastal areas are community stressors, disrupting and displacing families and businesses. The costs of rebuilding are making insurance either expensive or impossible to acquire. Missoula has minimal exposure to extreme weather events and thoughtful development patterns lessen the risk of major destruction from wildfires.
Housing Affordability Challenges
One major stumbling block for Missoula is housing affordability and availability, ranking the city close to the bottom. The city recognizes these as critical issues, but addressing them is complicated by high construction costs, regulatory hurdles, and economic conditions like rising interest rates. These factors make it difficult to meet the demand for housing, which must remain a priority for maintaining competitiveness.
Investment and Business Opportunities
This strong performance across multiple indicators positions Missoula as an attractive location for businesses and residents alike. Its steady employment growth, burgeoning high-tech sector, and quality of life make it a secure and appealing place to invest. Businesses leaving high-risk areas like the coasts may find Montana’s affordability and stability worth the premium, especially as insurance costs and natural disaster risks rise elsewhere.
For real estate investors, Missoula’s tight vacancy rates in office, industrial, and retail spaces present opportunities. Spaces that sit vacant often need modernization or reconfiguration to meet current market demands. Housing, particularly diverse and affordable options, also remains a critical area for investment, as multifamily vacancies have shifted back into a supply shortage after a brief period of equilibrium.
Strategic Growth for Future Success
Missoula’s future success hinges on strategic growth. By addressing housing shortages, leveraging economic strengths, and maintaining a focus on quality of life, the city is poised to capitalize on new opportunities. For businesses and investors, Missoula represents a resilient, thriving community ready to support sustainable development and expansion.
