The top-performing cities are not necessarily where you would think they are. According to the 2024 Milken Institute’s Best-Performing Cities Index, Austin, Texas, has taken over the top spot on the list from Provo-Orem, Utah.
Among small cities, Idaho Falls, Idaho maintained the first position this year after earning the same spot in last year’s rankings. These cities’ rankings were fostered by strong job and wage growth and a robust high-tech presence.
The index, which has been published annually since 1999, takes into account new data this year, tracking the importance of sustainable growth, community resilience, income inequality, labor market performance, high-tech sector’s impact on the area, ability to respond to economic and natural disasters, and resident’s access to economic opportunities.
While this report is comprehensive, there is a lag in the data: the 2024 index and rankings are mainly based on data from 2022. During that year, the US labor market added more than 6 million jobs, 90.7% of which were in metropolitan areas, proving the importance of cities to the nation’s growth.
“The labor market displayed remarkable resilience in 2022. By the end of the year, total US employment exceeded its pre-pandemic level, though the national statistics mask important differences across metropolitan areas. Many low-tier large and small cities continued to struggle, with employment numbers that remained below their 2019 levels. This signals that the pandemic has had long-lasting impacts on the economy of several metropolitan areas,” said Maggie Switek, PhD, senior director of the Milken Institute’s Research Department.
This year’s top-performing cities had several common themes: a vigorous and growing high-tech sector, rebounding leisure and hospitality sectors, and community resilience. Simultaneously, housing supply and affordability was a concern among most top-performing cities. While remarking on the strong performance of top-ranked cities, this year’s BPC report also noted that cities that offer higher wages and lower costs of living remain attractive to younger generations of workers.
Having become an established hub for an extensive number of high-tech industries, Austin received the top ranking with the highest levels of employment growth and wage growth over the last five years. This is the sixth consecutive year that the Austin–Round Rock area has ranked in the top five best-performing cities.
“Austin has always been a town where new and different ideas are welcomed. That embrace of creativity and imagination has helped us stay a great city and evolve into a focal point in the global economy. This is a truly exceptional place in which to live and work, and talented folks from all over have been drawn to Austin by the natural beauty, live music, and, yeah, it’s great barbecue. I’m very proud the Milken Institute has recognized Austin as the nation’s Best-Performing City,” said Austin Mayor Kirk Watson.
Idaho Falls, Idaho tops the list of small cities for the second year. The metro’s top position is due to its strong performance across all components of the index, signaling that growth has been sustainable and inclusive.
Click here for an interactive map that combines all the data into an easily accessible format.
