In stormy times, these 15 U.S. cities make jobs happen

What does it take for a city to become a jobs magnet? 

A new study by LinkedIn's Economic Graph team looks at labor-market conditions in 182 U.S. metro areas for 2020 -- and highlights 15 standouts in the face of a chaotic economy. The analysis focuses on two key measures, adjusted for demographic size.  

The first measure is the average volume of job postings on LinkedIn; the second is the quantity of people in each area getting hired, as tracked by updates to their LinkedIn profiles. 

As the table below shows, the top 15 cities span the breadth of the country. They include well-known coastal leaders such as Seattle, San Francisco, Boston and Washington, D.C., as well as a flurry of often-overlooked achievers in the middle of the country. The latter group includes Austin, Nashville, Tenn., Madison, Wis., and Provo, Utah. 

 Success in 2020 didn’t come easy -- and this week’s unfolding events represent a whole new dimension of turmoil. The robust economy of a year ago (just 3.5% unemployment in February) collapsed in the spring as COVID-19 related economic restrictions pushed millions of people out of work. April’s jobless rate of 14.7% was the worst in many decades. 

 Since then, an unusual city-to-city “revolving door of talent” has taken hold. A highly visible group of people have left high-cost cities such as San Francisco and New York in favor of more affordable, less disrupted smaller locales, as this September 2020 edition of Workforce Report documents.

 Yet at the same time, some of these big cities haven’t lost their ability to keep making jobs happen, tapping into either the optimism of new arrivals or the willingness of existing residents to switch jobs. It’s all part of the gritty, uneven national recovery in the later part of 2020, which reduced the jobless rate to 6.7% in November.  

 To see how the top-15 cities have secured their edge, it helps to examine three distinct strategies -- and the ways each city pursued the one best-suited to their region. A few made the most of what could be called “the tech sector lift.” Others benefited by attracting out-of-area employers to set up regional operations or even move their headquarters.

 In the most common strategy, cities have benefited from modest advances across the board. That’s the pattern in cities leveraging economic diversity, where upticks in a wide range of industries add up to overall success. Often, strong nearby universities and a highly educated workforce helps these overlapping clusters of success thrive.

 Here’s a closer look at how these factors have played out.

 For top-ranked Seattle, being Amazon’s home town means a nonstop flow of additional jobs, many of them in tech. While the COVID-19 pandemic jolted most of the economy, it also led to a huge surge in demand for Amazon’s e-commerce services. Amazon added 427,000 employees worldwide in the first 10 months of 2020.

 Even though many of those hires were scattered throughout the U.S. (and the world), Amazon’s headquarters hiring boom was big enough to turn the company into Washington state’s largest corporate employer, overtaking long-time leader Boeing. Currently, Amazon has more than 9,000 Seattle-area jobs listed on LinkedIn, with 6,900 of them classified as being in tech.

 The Seattle area also gets a lift from the presence of other tech companies, including Microsoft (which owns LinkedIn), Expedia, Salesforce’s Tableau unit and sizable outposts for Google, Facebook and other tech leaders.

  The fourth-ranked San Francisco Bay Area has seen its tech sector thrive -- and expand -- too, as the rise of remote work creates more demand for digital tools that can keep us all (semi)-connected no matter what. Companies such as Apple and Facebook each have more than more than 1,000 job openings listed on LinkedIn that are at or near their Bay Area headquarters.

 Second-ranked Austin is taking a different tack, becoming a prime destination for out-of-area companies wanting to build up their regional presence or move their entire headquarters. In the most prominent example, Oracle in December announced that it is leaving the San Francisco Bay Area in favor of new headquarters in Austin.

 Meanwhile, smaller-scale expansions and relocations are being announced so rapidly that the Austin Chamber of Commerce counts more than 100 of them in 2020. Examples include financial-services company Pimco (200 jobs), British aerospace company BAE Systems (700 jobs) and logistics company Flex Health (600 jobs).  

What works constantly for Austin can be seen more intermittently in other cities, such as eighth-ranked Nashville. It stands to gain 100 jobs from the arrival of Yoshi, a former Silicon Valley company that brings field techs to people’s cars for on-the-spot servicing. Company founder Brian Frist didn’t need to be told twice about Nashville’s allure; his father is former Tennessee senator Bill Frist. 

 Gradual growth among many existing employers sounds less exciting, but it’s been a winning strategy for the majority of the cities on the top-15 list. An especially rich illustration of industrial diversity comes from 10th-ranked Madison, Wis., where “We’re Hiring” announcements lately have come from the likes of grocery stores, trailer makers and cutting-edge developers of tests for COVID-19. 

 It’s a similar story in fifth-ranked Raleigh-Durham, N.C., or sixth-ranked Denver. In both those locations, regional economists are calling out industries as diverse as education, professional services, transportation, leisure and hospitality as ones that can contribute to an economic upturn this year. 

Methodology

U.S cities with the most opportunity are identified by analyzing the sum of members hired in a given year and the average number of open jobs in a given year. Both of those city-specific metrics are divided by each location’s average member count in that year. The metrics are combined by calculating a z-score for both hiring and jobs -- and then ranking the added z-scores. Data scientist Brian Xu contributed to this report, and data scientist Yi Su produced the broader economic overview below.

Recovery Tracker

It's long been said that business recoveries involve "climbing a wall of worry." If so, the U.S. economy has wiggled a little higher in recent weeks.

That's the picture that emerges from the latest edition of the LinkedIn Recovery Tracker, which focuses on the eight factors shown below. In particular, both the worker confidence index and the LinkedIn Labor Stress Index improved in December. The hiring rate in the U.S. has climbed slightly, too, after many months in negative territory. It's now flat on a year-over-year basis, similar to its pre-pandemic level.