While pros­per­ity by­passes many ar­eas, small towns out West find their foot­ing

The Buffalo News - - FRONT PAGE - By David J. Lynch WASH­ING­TON POST

HAMIL­TON, Mont. – As small towns else­where saw pros­per­ity pass them by in fa­vor of the big cities, some­thing un­usual hap­pened to this ru­ral ham­let tucked in the Bit­ter­root Val­ley: It flour­ished.

Two lo­cal boys came home from col­lege and launched a mi­cro­brew­ery that takes in more than $1 mil­lion in an­nual sales. Re­tirees ar­rived in droves, drawn by af­ford­able land and re­cre­ation op­por­tu­ni­ties in the area’s snow-frosted moun­tains and trout­filled streams. And the fed­eral gov­ern­ment’s Rocky Moun­tain Lab­o­ra­to­ries opened a state-of-the-art biosafety fa­cil­ity to in­ves­ti­gate the dead­li­est vi­ral dis­eases, in­clud­ing Ebola.

As U.S. eco­nomic growth in the past decade as­sumed an in­creas­ingly ur­ban char­ac­ter, that di­verse set of strengths en­abled this town to defy a per­va­sive nar­ra­tive of ru­ral de­cline. Hamil­ton’s pop­u­la­tion of 4,728 is up more than 10 per­cent since 2010, re­flect­ing a Western re­nais­sance that con­trasts with the ex­pe­ri­ence of small towns in other re­gions.

“It’s a pretty sweet spot to be in,” said econ­o­mist Ray Rasker, of Head­wa­ters Eco­nomics in Boze­man, Mont. “You can have the same job you’d have in Seat­tle and go fly fish­ing in the af­ter­noon. … It’s the qual­ity of life. It at­tracts tal­ent. Pretty soon, tal­ent builds on it­self, and word gets out.”

Hamil­ton has par­layed dis­tinc­tive at­tributes into pop­u­la­tion growth, in­clud­ing prox­im­ity to the state’s sec­ond­largest city, ma­jes­tic sur­round­ings, a good sup­ply of col­lege grad­u­ates and a depend­able base of fed­eral gov­ern­ment em­ploy­ment.

All of that makes Hamil­ton rep­re­sen­ta­tive of a lit­tle-no­ticed trend. Western towns with fewer than 5,000 res­i­dents grew by an av­er­age of nearly 8 per­cent from 2010 to 2017, ac­cord­ing to the Cen­sus Bureau, while sim­i­lar­sized com­mu­ni­ties in the North­east and Mid­west shrank. Those in the South grew barely 1 per­cent.

“It is striking,” said Mark Muro, se­nior fel­low at the Brook­ings In­sti­tu­tion. “Ru­ral towns are do­ing bet­ter in the West. Smaller towns are do­ing bet­ter in the West.”

Yet Hamil­ton of­fers no ob­vi­ous for­mula for suc­cess that could be trans­planted to the half-empty ru­ral com­mu­ni­ties that have yet to fully re­cover from the Great Re­ces­sion. Other com­mu­ni­ties could em­pha­size ed­u­cat­ing their work­force. But some ad­van­tages, in­clud­ing a largely re­ces­sion-proof fed­eral fa­cil­ity and stun­ning nat­u­ral sur­round­ings, aren’t avail­able ev­ery­where. Hamil­ton’s en­durance only high­lights the chal­lenges con­fronting the na­tion’s en­dan­gered small towns.

“Most places are on the wrong side of huge global and tech­no­log­i­cal trends,” said Muro.

Hamil­ton got its start in the late 19th cen­tury, thanks to Mar­cus Daly, an Ir­ish cop­per baron who sought a sum­mer home for his fam­ily and a re­li­able sup­ply of lum­ber for his busi­ness.

To­day, the big sawmills are mostly gone. The pic­turesque Main Street, brack­eted by moun­tain views, is lined by two-story brick re­tail out­lets. Nearly all the res­i­dents are white and con­ser­va­tive. Al­though some af­flu­ent re­tirees have ar­rived in re­cent years, this is not a wealthy ru­ral en­clave. Hamil­ton’s me­dian house­hold in­come is $30,000 an­nu­ally, well be­low the state’s $50,000 fig­ure.

Among those join­ing the Hamil­ton in­flux were child­hood friends Fenn Nel­son and Jasper Miller, both 31, who re­turned here to open a brew­ery and restaurant af­ter grad­u­at­ing from the Univer­sity of Mon­tana in Mis­soula. With a busi­ness de­gree, Nel­son took charge of the books, while Miller put his mi­cro­bi­ol­ogy diploma to use keep­ing the brew­ery in work­ing or­der.

Em­ploy­ing used equip­ment, they leased a for­mer nat­u­ral foods em­po­rium and con­verted it into Higher­ground Brew­ing. In­side the low-slung build­ing, the decor is spare: a checker­board tile floor, stools and a few ta­bles.

One of two brew­eries in town, Higher­ground posted $1 mil­lion in sales in its sixth year of op­er­a­tions and has been prof­itable for the past “two to three years,” Nel­son said. About 40 per­cent of its out­put is sold else­where in the state.

They had con­sid­ered lo­ca­tions in Idaho and Cal­i­for­nia, but the men said the ad­van­tages of com­ing home were clear. A lo­cal banker, who had known them for years, ap­proved a $162,000 loan that got them started. Miller’s re­cently re­tired fa­ther pitched in on sev­eral projects, pro­vid­ing free la­bor that would not have been avail­able if they had launched else­where. The young men also saved money by liv­ing with their par­ents.

Lo­cated an hour south of Mis­soula, a city of roughly 75,000 with an in­ter­na­tional air­port, a ma­jor state univer­sity and a Wal­mart, Hamil­ton “is in a great Goldilocks zone,” Miller said. “It’s re­ally ac­ces­si­ble.”

Hamil­ton’s rel­a­tive out­per­for­mance – and that of Western towns, in gen­eral – comes amid the ur­ban­iza­tion of Amer­i­can eco­nomic growth. Glob­al­iza­tion and tech­nol­ogy deeply eroded small towns’ tra­di­tional man­u­fac­tur­ing role while plac­ing a pre­mium on the skills of the ed­u­cated di­gerati in the na­tion’s largest cities.

The West has nav­i­gated these shift­ing eco­nomic tides bet­ter than other parts of the coun­try. Since 2010, it has been by far the fastest-growing re­gion in the coun­try, ac­cord­ing to the Cen­sus Bureau, ex­pand­ing out­put two-thirds faster than the Mid­west and more than twice as fast as the North­east.

Based on mea­sures of new-busi­ness for­ma­tion, mi­gra­tion and job churn, Western states are sig­nif­i­cantly more dy­namic than those in the East, said John Let­tieri, pres­i­dent and CEO of the Eco­nomic In­no­va­tion Group, a Wash­ing­ton con­sult­ing firm.

“These are newer economies. They have fewer con­crete cin­der blocks to drag around be­hind them as they’re try­ing to grow,” he said. “There’s an un­mis­tak­able East-West di­vide.”

In much of the coun­try, small towns were poorly equipped to cap­i­tal­ize on the new econ­omy of glob­al­ized sup­ply chains and high-tech­nol­ogy ser­vices jobs. But Western towns such as Hamil­ton were never heav­ily de­pen­dent upon man­u­fac­tur­ing. Lack­ing big fac­to­ries that could be hol­lowed out by com­pe­ti­tion from China or au­to­ma­tion, they es­caped the big job losses that went with them.

Hamil­ton is home to a Glax­o­SmithK­line plant that pro­duces a vac­cine in­gre­di­ent, but the town’s man­u­fac­tur­ing work­force as a share of to­tal em­ploy­ment is one-third smaller than the na­tional av­er­age, ac­cord­ing to the Cen­sus Bureau.

In man­u­fac­tur­ing-de­pen­dent com­mu­ni­ties, many work­ers aban­doned school be­fore get­ting a col­lege de­gree, since good-pay­ing jobs were avail­able with­out one on the fac­tory floor. Hamil­ton’s fed­eral lab, which em­ploys about 450 work­ers and at­tracts skilled per­son­nel from as far away as In­dia, is a con­tin­u­ing re­minder of the value of ed­u­ca­tion.

The lab’s 36-acre site has its roots in the late 19th cen­tury, when lum­ber­jacks re­turned from the nearby woods with an un­usual ill­ness known as “the black measles.” State of­fi­cials es­tab­lished a mod­est out­post, which the fed­eral gov­ern­ment pur­chased in 1932, to in­ves­ti­gate what was later iden­ti­fied as Rocky Moun­tain spot­ted fever.

In­side to­day’s fa­cil­ity, some of the world’s top sci­en­tists in­ves­ti­gate na­ture’s tough­est chal­lenges, scru­ti­niz­ing tis­sue sam­ples with so­phis­ti­cated elec­tron mi­cro­scopes and con­duct­ing Ebola ex­per­i­ments while wear­ing full body biosafety suits. Re­search con­ducted here led to the first vac­cine for Ebola, which was de­ployed in the West African out­break sev­eral years ago.

Peo­ple have re­marked on the Bit­ter­root’s nat­u­ral beauty since 1805, when ex­plor­ers Lewis and Clark passed through on their way to the Pa­cific Ocean. Hamil­ton abuts one of the largest wilder­ness ar­eas in the coun­try, home to hik­ing, ski­ing and fly fish­ing, and en­joys a mild cli­mate that has earned the val­ley the so­bri­quet “Mon­tana’s ba­nana belt.” The out­doors is more than a scenic back­drop. It’s a pil­lar of the lo­cal econ­omy.

Chuck Strana­han, a vet­eran fish­ing guide who put him­self through col­lege ty­ing flies for a re­tailer, owns a fish­ing shop near Main Street. The for­mer Cal­i­for­nia school ad­min­is­tra­tor sells hand-tied flies and charges $500 a day to guide an­glers along the Bit­ter­root River or one of 13 nearby creeks.

Mar­shall Bloom, as­so­ciate di­rec­tor of the fed­eral lab, says Hamil­ton’s sur­round­ings make re­cruit­ing top tal­ent easy. Na­tion­wide, peo­ple have been more likely to move to coun­ties with op­por­tu­ni­ties for out­door ac­tiv­i­ties than those with­out them, ac­cord­ing to a study by Head­wa­ters Eco­nomics. “Re­cre­ation may make the dif­fer­ence be­tween gain­ing or los­ing pop­u­la­tion, par­tic­u­larly in ru­ral coun­ties,” it said.

Wash­ing­ton Post

The pop­u­la­tion of Hamil­ton, Mont., is 4,728, up more than 10 per­cent since 2010. Re­tail out­lets fill Main Street, which is brack­eted by moun­tain views. Peo­ple have re­marked on the Bit­ter­root Val­ley’s nat­u­ral beauty since 1805, when ex­plor­ers Lewis and Clark passed through.

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