With recession far behind in the rearview mirror, the American economy is now in its full swing again, and we bring you a list of 12 US cities doing the best economically right now. Nevertheless, the pace of the economic recovery is not the same in all American cities. Some cities like Detroit, for instance, will need much more time than the likes of Bismarck whose fortunes were turned thanks to Bakken shale oil. In short, things have changed quite a lot since the late 2008 shock, and a map of wealthiest US cities has been shaken up in return. But with oil reserves being at their highest level ever, oil boomer cities and their express economic growth are becoming jeopardized. Furthermore, low oil prices don’t really go in their favor as well, and things are projected to deteriorate even further. Future of most American cities is uncertain, to say the least, and we can only concentrate on the current situation.
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It comes without saying that economically sound cities exhibit their share of fast growth, and here’s the list of 10 fastest growing cities in America in 2015. Of course, fast growth of respective city’s population and economy don’t necessarily have to be related, though they usually are. So, what are the categories that define respective city’s economic progress and overall level of well-being? These have to be average income per capita, unemployment rates and low poverty ratings. This criteria trio might not be able to offer completely accurate picture on what the best economies among US cities currently are, but they’ll bring us as close as possible.
Average GDP per capita by metropolitan area can be obtained from the US Bureau of Economic Analysis. At the same time, unemployment rates have been pulled from the Bureau of Labor Statistics, and poverty rates can be found in this Federation of American Scientists report (look in the appendix). As you can see from the sources, latest data are still unavailable, so you’ll have to forgive us if something has changed dramatically in the last few months. While unemployment rates are as fresh as they can be (November, 2015), poverty ratings have been published during January of the same year. Finally, per capita real GDP has been calculated as average for 2013 and 2014, which are the last two of available years.
After getting the data, the only thing remaining is to interpret it and develop a viable ranking system. We have rated more than 120 metropolitan areas across America that we figured had a chance to get on the list. All of them have been rated in all three categories, and the composite score has determined which of them found its place on our list of 12 US cities doing the best economically right now. But how have we compiled the composite scores? For all three categories, we have taken the minimum and maximum appeared value. We have decided to assign points from 5 to 10 which means that there are six grades in total. The difference between the minimum and maximum value has thus been divided by six, and the grades have been applied. Of course, with three criteria and six grades, there’s bound to be a tie here and there. Cities and metropolitan areas with higher GDP per capita have been given an advantage as overall salaries showcase respective city’s economy strength the best, by our assessment.
12. Bismarck, ND
Composite score: 25
Bakken shale oil has had a large impact on Bismarck’s booming development in recent years, as we have already mentioned above. Per capita average GDP in North Dakota’s capital amounts to $42,100 and has a tendency to rise slowly. What’s more important, however, are very low unemployment and poverty rates of only 2.2% and 8.3% respectively. For comparison, lowest unemployment rates in the US are exhibited by Ames, Indiana, and Fargo, North Dakota – Minneapolis, and amount to 1.9%. At the same time percentage of people living below the poverty line is lowest (6.4%) in California – Lexington Park, Maryland. Even though Bismarck’s economy seems to be showcasing a steady rise, historically low oil prices have had their toll, and will certainly impact Bismarck’s growth in the future. In fact, we have witnessed reports of North Dakota’s extremely low crude oil worth in the last few days. Shale oil in North Dakota is so cheap due to its very low quality that in fact, it’s worth almost nothing at this point. It seems that Bismarck’s smooth sailing is coming to an abrupt end.
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11. Burlington – South Burlington, VT
Composite score: 25
Most of northeastern states are highly developed, and so is Vermont. Burlington – South Burlington metropolitan area has had a median real GDP per capita income of $54,454 for the last two available years. Unemployment rate as of November 2015 amounts to only 2.7%, and 10.5% of people live under the poverty line. This might seem like much, but considering that American average for poverty is 15.8%, while that for the state of Vermont is 12.3% – Burlington is still doing well.
10. Minneapolis – St. Paul – Bloomington, MN-WI
Composite score: 25
While large parts of the country still have their trouble in creating jobs, Twin Cities and their metro area are doing rather well for themselves. They feature the lowest unemployment rate of 2.7% among large metropolitan areas in the country; add to that poverty rate of 10.3% and GDP per capita of $61,767 with a tendency to rise, and you’ll figure out why that’s true. But why is that the case? Well, Twin Cities are doing a good job in many areas including healthcare and start-up businesses. Even North Dakota’s shale oil production has had a positive effect on neighboring Minnesota, and with oil prices plummeting, consumers will have even more to cheer about.
9. Cedar Rapids, IA
Composite score: 25
Iowa’s second largest city is not as dependent on agriculture as people would like to think of. While it’s corn processing plants do employ a large chunk of metro area’s population, employers like Transamerica and Rockwell Collins are doing something entirely different. GDP per capita has reached $62,261 for 2013 and 2014, and exhibits a tendency to rise. The unemployment rate of 3.3% and a poverty rate of 9.2% are playing a major role in Cedar Rapids’ ninth position on this list of 12 US cities doing the best economically right now.
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8. Washington – Arlington – Alexandria, DC-VA-MD-WV
Composite score: 25
It’s a no-brainer, but nation’s capital simply has to make a list of most successful cities economically. Here it is with real GDP per capita of $72,603, the unemployment rate of 4.1% and poverty rating of only 8.5%. It has to be noted that unemployment rate has plummeted from 4.9% in June to current level in November 2015. Apart from thriving tertiary sector accustomed to state capitals, Washington – Arlington – Alexandria features a high proportion of high-paying tech and STEM jobs which have certainly influenced the overall score.
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7. Trenton, NJ
Composite score: 25
Trenton is doing a fine job in developing its economy which can be seen from a number of companies that have decided to take their talents there. Among those relocating to the city are Trenton Steel Corporation and LMT Mercer Group, for instance. Apart from adding to tax budget, most of Trenton’s employers are paying fine salaries. Average GDP per capita for last two available years amounts to $73,951, but showcases tendency of decline. At the same time, unemployment is at 4.2%, and 11.8% of people live below the poverty line.
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6. Boston – Cambridge – Newton, MA-NH
Composite score: 25
A large part of Boston greater area’s economy goes on education and health services, but that’s still only a part of this metro area’s total economy. Professional and business services are coming in second, while trade, transportation, and utilities round up the top three. Median GDP per capita showcases a rising tendency and currently amounts to $74,172. The unemployment rate is rather good for a metropolis, coming to 4.1%, while 10.4% of people here live below the poverty line.
5. San Francisco – Oakland – Hayward, CA
Composite score: 25
The entire Bay Area has become a thriving ground for high-tech engineering companies, and it’s no wonder why professional and business services amount to almost quarter of San Francisco metro area’s total economy. Only 3.9% of people are unemployed in Bay Area, which is a solid score for such a large metropolis. 11.5% of people, however, live below the poverty line, but overall GDP per capita amounts to $79,328 with soaring tendency – mostly thanks to already mentioned industry.
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4. Sioux Falls, SD
Composite score: 26
Unlike the North Dakota’s oil boom, southern neighbors are progressing thanks to manufacturing, healthcare and financial services mostly. Sioux Falls takes most plaudits for this economic growth – being South Dakota’s largest city. Median GDP per capita in Sioux Falls is steady at $65,679, but the unemployment rate of 2.2% and the poverty rate of 9% are what’s propelling Sioux Falls as high as number four spot on our list of 12 US cities doing the best economically right now.
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3. Bridgeport – Stamford – Norwalk, CT
Composite score: 26
Like most of the east coast cities, greater Bridgeport metro area showcases steady economy growth with median real GDP per capita amounting to $94,230. The unemployment rate is slightly higher at 4.7%, but only 9% of people in Bridgeport – Stamford – Norwalk live below the poverty line. Connecticut’s biggest city and nearby boroughs are the home to many companies including UBS. Hence, it comes as no surprise that metro area does quite well economically at the moment.
2. San Jose – Sunnyvale – Santa Clara, CA
Composite score: 26
San Jose, together with its neighborhoods, has grown quite a lot over the recent years, and its economy followed. Being part of the Bay Area, it’s no wonder why this is happening. San Jose features a number of prolific high-tech engineering companies, and the city is among the best in the country by job creation. The capital of Silicon Valley features average GDP per capita of $103,014 with the strong growing tendency and an unemployment rate of 3.9%. At the same time, however, 10.5% of metropolis’ inhabitants are finding it tough to survive.
1. Midland, TX
Composite score: 28
Pretty much any report on city economies will tell you that oil-rich Midland, Texas leads the nation in highest median salaries. Average GDP per capita amounts to $148,860, and the tendency of growth is simply staggering. The unemployment rate is currently at 3.5%, while poverty rating stands at 9.3%. It’s no secret that Midland’s economy and extraordinary growth are based on oil extraction and exploration. However, unlike Bismarck’s shale oil, Midland’s Permian Basin crude oil is of much better quality, so economy crackdown here is out of the question. This concludes our list of 12 US cities doing the best economically right now.
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