The economy’s back on track, jobs are being created, and things are generally looking up for most Americans. It’s been a long struggle over the past several years since the recession officially ended, but things are finally starting to smooth out. Of course, that is true in some places more than others.
Every year, economic non-profit think tank the Milken Institute takes an in-depth look at the economic factors shaping our cities and towns, in an effort to find out what makes some areas more successful than others. When all is said and done, the organization releases its annual report, and as it says, “delivers a fact-based, comprehensive evaluation system across metropolitan areas that relies upon job, wage, and technology trends shaping current and
Called the Best-Performing Cities report, the Milken Institute is able to close in on what major U.S. cities, as well as smaller metro areas, are performing at the highest economic levels. This can include an areas ability to create and sustain jobs, friendliness toward entrepreneurs and businesses, and the types of innovation and technology are being produced in a given area.
The 2014 report was just released, and overall, the economic outlook for the country as a whole is positive. The economy nationwide averaged 4.2% growth in the second and third quarters of 2014, with signs pointing toward more business investment, lower housing prices, and continuously-falling oil prices headed into 2015. All in all, America’s short-term economic future is bright.
But what about specific cities? Naturally, the 2014 Best-Performing Cities report produced some expected results, and maybe a couple of surprises. Read on to see what cities the Milken Institute has declared to be 2014 top economic performers.
10. San Antonio, Texas
Jumping up two spots from last year, San Antonio was able to leapfrog cities like Seattle and Boulder to crack this year’s top ten. This southern Texas city has seen impressive job growth over the past eight years in particular, ranking eighth nationwide in that regard.
While the health care industry and military has a strong presence, providing a solid job base for thousands, many new positions have opened up recently thanks to the energy industry investing heavily in shale exploration and oil production. There has also been an uptick in insurance industry jobs, with more than 6,000 created in the past five years.
9. Dallas, Texas
The Dallas metropolitan area has also shown some strong economic resilience over the past several years. Though the Dallas-Plano-Irving complex actually descended down the list this year, losing two spots.
What has kept Dallas among America’s thriving economic cities is the area’s generous business climate, and ability to create short-term jobs. The city has a strong high-tech presence, and the professional and scientific sectors added more than 4,000 positions last year alone. One thing that is starting to hamper Dallas’ growth, however, is a skyrocketing cost of living — a problem we’ve seen in many other cities across the country.
8. Fort Worth, Texas
If there’s one thing clear from the Milken Institute’s findings so far, it’s that Texas is a great place to be. Dallas may have had another strong year, but its close neighbor Fort Worth actually outperformed it in 2014. In fact, Fort Worth jumped a whopping eight spots this year, as one of the country’s biggest gainers.
Fort Worth ranked highly for job growth between 2008 and 2013, as well as short-term job growth, in which the city ranked 21st nationally. One big thing Fort Worth has working in its favor is considerably lower costs of doing business compared to cities like Dallas or Austin, making it a hot spot for the logistics and transportation industries. Thousands of trucking and railroad jobs have been created over the past few years, in addition to automotive manufacturing jobs.
7. Houston, Texas
Again, we stay in Texas. Houston, the state’s largest city, continues to be an economic hub, actually climbing the rankings by one spot this year. The Houston-Sugar Land-Baytown metro area ranked very highly for both job and wage growth over the past five or six years, as well as high-tech GDP growth.
One of Houston’s major economic drivers continues to be the energy sector, as well as a friendly business climate that is attractive to large corporations looking to expand or find a new home base. But it can’t be understated how great Houston’s wage growth has been; the Milken Institute says that the city has outperformed the national average by 22%, making it a very attractive place for professionals looking to boost their earnings.
6. Salt Lake City, Utah
At long last, a city that isn’t in Texas! The sixth-spot in this year’s rankings goes to Salt Lake City, which dropped one spot from last year. The area has performed fairly well in terms of both job and wage growth, and has benefited enormously from the high-tech industry’s expansion there.
One of the city’s major strengths is its core population of young, highly-educated professionals. Salt Lake City has established itself as a lower-cost alternative to many of the nation’s other major cities, yet has still become a financial and technology hub. In fact, Goldman Sachs now employs more people in Salt Lake City than anywhere else in the U.S., except for New York City.
5. Raleigh, N.C.
The Raleigh-Cary metro area in North Carolina made tremendous strides over the past year, gaining eight spots in the Milken Institute’s rankings, thanks to very strong numbers in short-term job growth and increasing interest from the high-tech industry. Friendly government and tax policies, along with a strong influx of young talent from nearby universities have also helped keep Raleigh among America’s top economic hot spots.
Raleigh has been one of the top cities in the country for job creation, with employment rising 4.2% between August 2013 and August 2014. The professional, technical and scientific industries added more than 3,000 jobs during 2013, for a growth rate of 7.2%. There have also been several expansions announced by numerous IT companies, bringing in thousands more positions in the next few years.
4. San Jose, Calif.
Out west, San Jose has been able to capitalize off of the high-tech industry located in nearby Silicon Valley and San Francisco. The city has ranked extremely high in job growth over the past year or two, and was the top city in the nation for high-tech GDP concentration in 2013. It also ranks third in the nation for the number of high-tech industries.
With numerous startups, venture capital firms, highly-ranked universities and large tech companies, San Jose is in a prime position to be an economic hub for years to come. Technology companies employ a whopping 270,000 people in the area, which is a higher percentage than even San Francisco. With companies like Facebook, Apple, Google, and numerous others right down the road, it’s not hard to see why.
3. Provo, Utah
A short trip from Salt Lake City, the small city of Provo is proving that a town doesn’t need to be near Silicon Valley or the oil fields of Texas to be an economic powerhouse. Provo ranked first nationally for job growth over the past year, and third in job growth over the past five years. Wage growth has also been particularly strong, and the high-tech industry has had a lot to do with it.
For a city with a population of not much more than 100,000, Provo is incredibly dense with IT companies, manufacturing plants, and even life-science firms. Software and data processing is a fast-growing sector that is propelling Provo further, and high-tech companies are being readily supplied with new troops graduating from BYU, the University of Utah, and other nearby schools.
2. Austin, Texas
Leading the nation in job growth over the past several years, and coming close in wage growth, the Austin area continues to be a hotbed of opportunity. Austin has become one of a few quintessential technology and startup hubs around the country, rivaling even New York City and Silicon Valley. What gives the city a leg up in many respects over those others is a lower cost of living.
The professional, scientific, and technical industry has added 16,500 jobs over the past five years, for a growth rate of 8.9%. Not only are tech startups doling out jobs, but the space exploration industry is also set to make an impact, creating even more jobs. Austin also has the highest rate of in-migration in the country, with 31,000 more residents having moved to the city than having left it. Austin did slip one spot this year, handing over the crown to a new economic champion.
1. San Francisco, Calif.
It’s hard to beat the Bay Area, with San Francisco, San Mateo, and Redwood City all having become one cohesive economic monster over the past few decades. San Francisco outranks every other city in America in terms of wage growth, and ranks very highly in job growth and high-tech concentration.
Though the area does have issues with gentrification and insane costs of living, there’s nowhere else in the country — or world, for that matter — that has a higher concentration of tech talent, startups, and innovators. The workforce is incredibly well-educated, and students from nearby Stanford and the University of California keep new and incumbent companies stocked with young, fresh talent. The Bay Area is this year’s top economic boomtown, and while others are on its heels, it’ll probably remain at or near the top of the list for some time.