Study: Best Cities for Young Professionals
If you're a young professional, chances are your career is one of the most important parts of your life, and you need a place to develop it. One way to decide where to get your start is to find a city that has a mix of opportunities for career advancement, high quality of life, and, of course, a decent beginners' salary.
Study Methodology
A number of statistics that would matter to a young professional choosing a city to live in were considered, but the three deemed most important were:
- Career opportunities (measured by the number of large companies)
- Compensation (measured by average starting/entry level salary)
- Cost of living (measured by the U.S. Census Cost of Living Index)
To rank the top 10 cities for young professionals, we began by looking at the number of Fortune 500 companies that call a city home, which indicates the status of an area’s business environment and career opportunities. We also considered entry-level salary averages, since the figures indicate how long someone will have to work to live comfortably and start to earn some disposable income. Cost of living is a good measure of this as well. A lower cost of living means less of your paycheck goes to necessities like food and rent, and that means you can afford a higher quality of life.
Also considered in the rankings were unemployment rate and the average age of the city’s population. Young professionals generally like to spend time with people their own age, so a high percentage of the population in the 45+ age bracket is less than ideal. A high unemployment rate can signal a tough job market and other economic issues, so cities with lower rates of unemployment were given preference in the rankings.
1. Houston, TX
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| Houston, Texas |
- Number of Fortune 500 Companies: 22
- Average Entry Level Salary: $38,000
- Cost of Living Index: 92.2
Houston tops the list because it combines opportunity with affordable living. Twenty-two Fortune 500 companies call the city home – the second largest number located in any one city – and the cost of living is comfortably below the national level. Unemployment is fairly low at 6%, which is well under the U.S. average and one of the lower rates on this list. For a city located outside the west and northeast regions, the average starting salary of $38,000 isn’t too low – though it is about 30% less than the highest on the list (San Francisco).
2. Dallas, TX
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| Dallas, Texas |
- Number of Fortune 500 Companies: 10
- Average Entry Level Salary: $37,000
- Cost of Living Index: 91.9
Texas may not be the first state that comes to mind when you think of choice locations for young professionals, but two Texas cities top this list! Dallas ranks just behind Houston because the 10 Fortune 500 companies located there are good enough to give the city the third most Fortune 500 headquarters, but are still less than half of Houston’s total of 22. In most of the other statistics examined, the cities are essentially equal. Also interesting to note: both Dallas and Houston are near the top of the list in percentage of population in the 18-44 age range, at around 39%. For young professionals looking to socialize with people their own age, this is a major positive.
3. Atlanta, GA
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| Atlanta, Georgia |
- Number of Fortune 500 Companies: 10
- Average Entry Level Salary: $43,000
- Cost of Living Index: 95.6
Atlanta is home to 10 Fortune 500 companies, which means it ties Dallas for the third highest total. It boasts an entry level salary of $43,000 – also the third highest on this list behind only New York and San Francisco. But with a cost of living about 4% below the national average, that salary will go a lot further in Atlanta than it would in those two notoriously costly cities. As the city with the highest percentage of people in the 18-44 age range, young professionals living there don’t lack for the company of people their own age. Atlanta’s major drawback is its unemployment rate, which at 8.4% is higher than the national average.
4. New York, NY
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| New York, New York |
- Number of Fortune 500 Companies: 45
- Average Entry Level Salary: $48,000
- Cost of Living Index: 216.7
New York is home to an amazing 45 Fortune 500 companies – twice as many as Houston, which houses the second highest total. That number and a high average entry level salary of $48,000 is the reason for the high placement on this list, but nation’s largest city has plenty of drawbacks as well. The unemployment rate is high both relative to the other cities on this list and the national average, and the cost of living is a staggering +116% (more than double!) compared to the national average. For young professionals, that makes a large difference in quality of life.
5. San Francisco, CA
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| San Francisco, California |
- Number of Fortune 500 Companies: 8
- Average Entry Level Salary: $49,000
- Cost of Living Index: 164
San Francisco has the highest average starting salary on this list at $49,000. Unfortunately, it has the second highest cost of living as well – 64% above the national average. It’s not nearly as expensive as New York, so the money you make will go much farther, but the 8 Fortune 500 companies that call San Francisco home pale in comparison the number New York offers.
6. St. Louis, MO
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| St Louis, Missouri |
- Number of Fortune 500 Companies: 8
- Average Entry Level Salary: $37,000
- Cost of Living Index: 90.4
In stark contrast to New York and San Francisco, St. Louis has the cheapest cost of living of any city on this list, at about 10% below the national average. It also has the smallest percentage – 35% – of people in the 18-44 age bracket. Most of the other cities are close to 40%, so the more extroverted young professionals may find the social scene to be lacking.
7. Minneapolis, MN
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| Minneapolis, Minnesota |
- Number of Fortune 500 Companies: 9
- Average Entry Level Salary: $34,000
- Cost of Living Index: 111
The fact that 9 Fortune 500 companies call Minneapolis home is quite impressive considering the city is only the 48th largest in the U.S. Also impressive is the unemployment rate, which at 5.1% is the lowest on this list. The cost of living in Minneapolis is a bit high for a Midwestern city, though, at 11% above the national average.
8. Columbus, OH
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| Columbus, Ohio |
- Number of Fortune 500 Companies: 5
- Average Entry Level Salary: $33,000
- Cost of Living Index: 92
Columbus has the fewest Fortune 500 companies and the lowest starting salary on this list, but it makes up for it in other areas. At 5.4%, the unemployment rate is a full 2% below the national average. The cost of living is a full 8% below the national average. Quite a few young professionals already call Columbus home – more than 39% of the population is in the 18-44 age range, which is one of the higher percentages on this list.
9. Chicago, IL
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| Chicago, Illinois |
- Number of Fortune 500 Companies: 8
- Average Entry Level Salary: $40,000
- Cost of Living Index: 116.9
If you’re a young professional looking for a highly urban environment but don’t want every dollar you make to go toward covering your expenses, Chicago is a great option. It’s home to 8 Fortune 500 companies, which may not stand out relative to the other cities on this list but is certainly impressive when compared to most urban areas in this country. Starting salaries are decent at $40,000, and the cost of living is only 17% above the national average – much lower than most big cities.
10. Charlotte, NC
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| Charlotte, North Carolina |
- Number of Fortune 500 Companies: 7
- Average Entry Level Salary: $38,000
- Cost of Living Index: 93.2
Charlotte is another city with an attractive mix of opportunity and affordability. Seven Fortune 500 companies call it home, which is a lot considering it’s one of the smaller cities on the list. The cost of living is about 7% below the US average, but the $38,000 average entry level salary isn’t much less than the low $40,000s offered in more expensive cities. The one major downside: a 9.4% unemployment rate, which is well above the national average and easily the highest of any city on this list.
To be sure, our study didn’t take into account careers in academics or the sciences, for instance, and we did not consider lifestyles. But the list should act as a starting point for young professionals who are on the fence about where to live after college, or where to relocate if they’ve been working for a few years and are looking for a change. Of course, the single most important element that any city needs to be a perfect fit for a young professional - a job offer - can’t be measured or ranked through statistics.
Don’t be afraid to explore all the career opportunities that come your way, even if they’re not located in your choice city.
Sources used to compile this study:
Leah Norris is a research analyst at CreditDonkey, a credit card comparison and reviews website. Write to Leah Norris at leah@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.
