Perhaps you’re a newly minted college grad who walked off the commencement stage with a job lined up and a new city to explore.
Or maybe it’s the other way around: You have to figure out where you’ll live — one option might be to stay right where you are — then find a job wherever you land.
With employers reporting plans to hire 5% more graduates in 2017 than in 2016, it appears the employment outlook for recent graduates is on the upswing. Yet as any English major can tell you: Not every city offers the same opportunities.
» COMPARE: The 10 best cities for recent college grads
NerdWallet analyzed data for the 100 largest U.S. cities and scored each according to the environment offered for recent college graduates who are looking to get a foothold in the working world. Here’s what we looked at — and factors you might want to consider.
Do other young adults live there? We looked at the percentage of the population ages 20 to 29.
Do other residents also have degrees? We examined the percentage of the 25-and-older population with a bachelor’s degree or higher.
How much does it cost to live there? We looked at median annual earnings of those 25 and older with bachelor’s degrees or higher, monthly gross rent (including utilities) and the percentage of monthly income gobbled up by rent.
What kinds of jobs are available? To gauge the career opportunities for college graduates, we incorporated the percentage of workers in the city whose occupations fall into the “management, business, science or arts” category as defined by the U.S. Census Bureau.
How tight is the local labor market? We examined the July 2017 jobless rate. Lower unemployment is generally thought of as favorable for workers in the labor market.
NerdWallet’s analysis examined 2015 U.S. Census Bureau data on job options, the age of the population, rent costs and median earnings, as well as July 2017 unemployment rates from the Bureau of Labor Statistics. To see the full data set, click here.
Cities with high rents can still be a good place to start out. Rent accounts for, on average, 26% of median income for residents 25 years and older with a bachelor’s degree in the top 10 cities, compared with nearly 25% in all 100 places, according to our analysis. It suggests that although high living expenses can be a burden, other factors — such as higher incomes — can make up for it.
Cities with lots of young adults and educated residents are top bets. Cities in the top 10 tend to rank highly for both the percentage of the 25-and-older population with a bachelor’s degree or higher and the percentage of the population ages 20 to 29. For example, the top city, Madison, Wisconsin, ranks eighth in the first metric (31%) and first in the second (26%).
Cities with big state universities are welcoming. Six of the cities in the top 10 are home to a major state university, and a seventh, Boston, has 35 colleges and universities in its borders, according to the city.
Wisconsin’s capital has lots of young educated adults, in part because it’s home to the state’s flagship campus, the University of Wisconsin. Combined with its low unemployment rate and high percentage of workers in management, business, science or arts jobs, Madison vaults to the top. Though its median income for those 25 and older with bachelor’s degrees, $46,275, is average among other cities in the top 10, the median gross rent, $981, is relatively affordable. As a result, rent as a percentage of income, 25%, is among the lowest in the top 10, and about average for all cities in this analysis.
Just over the Potomac River from the nation’s capital, Arlington is part of the densely populated region known as Northern Virginia, or NOVA. Rents are the highest among the top 10 — a median of $1,844 a month — and third-highest in our analysis. That the median income is $75,025 doesn’t quite offset the cost of living: Arlington’s young professionals still pour about 30% of their income into rent. Where it thrives is the percentage of workers in high-paying management, business, science and arts occupations (topping our list at 68%), likely due to the large technology, government contracting and finance employers in the region.
As the hub of the region that counts Amazon, Microsoft, Starbucks and the Boeing Co. among its biggest employers, the largest city in the Pacific Northwest ranks the best in the top 10 for the percentage of residents ages 25 and older with bachelor’s degrees (36%), and third-best for the percentage of folks who work in management, business, science and arts occupations (56%). It’s a pricey city, and not just the coffee: Rent and other essential living expenses will take nearly 27% of a median income for younger residents, which is higher even than the average of 26% for the more-expensive cities in the top 10.
The larger of the Minnesota’s Twin Cities (population 411,000 to St. Paul’s 301,000), Minneapolis ranks by far as the most affordable city in the top 10, with rent gobbling up just 21% of median income. Like the other Midwest city (Madison) on the list, Minneapolis is home to a big state university, the University of Minnesota, which no doubt contributes to the high percentage of the population ages 20 to 29 (21%), which makes it the eighth-most highest population in our analysis and third-highest in the top 10.
Boston has so many colleges that it’s often seen as a big college town. But our analysis suggests it’s good for graduates, too. Case in point: It ranks 13th out of 100 in our analysis for percentage of workers in of management, business, science and arts occupations at 47% (the national average is nearly 38%). That said, gross rent is the seventh-most expensive among the top 100 and third-highest in the top 10 at $1,423 a month, and median income for residents ages 25 and older with bachelor’s degrees ($56,853) doesn’t make Boston as affordable as most other cities.
Though it’s a much bigger city at over 650,000 residents, the nation’s capital looks a whole lot like Arlington in our analysis. Both are urban locales with high rents and high incomes. Washington has the second-highest percentage of workers in management, business, science and arts occupations in the top 10 and third-highest in the top 100 at nearly 61%.
This city ranks well in our analysis in some areas you might expect — what with all the technology workers and entrepreneurs flooding the restaurants. It has a highly educated population, with roughly a third of residents 25 or older holding bachelor’s degrees or higher. That’s good for fifth-highest in the top 100 and third-highest in the top 10. At $1,659, San Francisco also has one of the highest median gross rents in this analysis, but it makes up for it with the third-highest median income of $72,016.
Texas’ capital and a technology hub in its own right, Austin is home to the Lone Star State’s flagship campus, the University of Texas. Not surprisingly, Austin ranks highly in percentage of residents 25 and older with bachelor’s degrees (nearly 31%), which makes it ninth out of the top 100. It’s median gross rent — $1,139 a month — isn’t out the roof, as in some other cities in the top 10, but median annual incomes ($50,379) for residents older than 25 with bachelor’s degrees ranks 38th out of 100. The upshot: Austin is less affordable relative to most other cities in the country and most other cities in the top 10.
Georgia’s largest city and a magnet for people from around the South and beyond, Atlanta scores just behind Minneapolis in median gross rent as a percentage of income at 22%. In addition to affordability, the city is 10th in the top 100 in percentage of workers in management, business, science and arts occupations, in part due to the Georgia Institute of Technology, better known as Georgia Tech.
At the heart of North Carolina’s breakneck growth is Raleigh, the capital, which has grown over 60% since 2000 to upward of 450,000 residents. The city and surrounding suburbs are home to offices of numerous multinational companies in technology, life-sciences and finance. As such, Raleigh ranks highly for percentage of workers in management, business, science and arts jobs, with 46% — making it 15th out of the top 100. It also ranks seventh in our analysis for the percentage of residents 25 and over with a bachelor’s (nearly 32%), which is likely thanks to North Carolina State University.
For resources, see NerdWallet’s Moving and Money: A financial guide for relocating.
We analyzed data for the 100 largest cities in the U.S. by population. The unemployment rates for metropolitan areas are from the Bureau of Labor Statistics for July 2017. This is 20% of the score.
The rest of the score includes the most-recent data (2015) from the U.S. Census Bureau’s American Community Survey.
Percentage of the population 25 and older with a bachelor’s degree or higher is 15% of the score.
Percentage of the population ages 20 to 29 is 30% of the score.
Median earnings of residents 25 years and older with a bachelor’s degree are 10% of the score.
Jobs in management, business, science or arts occupations are 10% of the score.
Rent as percentage of income is 15% of the score.