Industry News

Economic Metrics of Top Performing Cities

Recently Andrew Rivkin was doing some reading on economic growth when he came across the Milken Institute’s latest study which focuses on the economic metrics of America’s top performing cities. The findings are known as the Best Performing Cities Index, and the annual study has provided very useful economic insight for over a decade.

The Milken Institute is a nonprofit economic research group that seeks to improve the world by discovering solutions that create jobs, spread wealth and improve health. The in-depth, independent economic research is conducted by global leaders involved in business, finance, government, and philanthropy, and from 2012 they gathered valuable metrics that helped pinpoint where work and pay are high and where business is thriving. This allows economists to better understand what it takes to sustain a metropolitan area in the twenty-first century and beyond, as well as the potential for advancement through innovation.

By considering job, wage and technology metrics the institute is able to peer into the working parts of America’s “Best-Performing Cities of 2012” index, which provides a comprehensive measure of economic strength across metropolitan areas. Each year the study reveals which cities are prospering as well as which are struggling. Here are the top five Large Performing Metro Areas of 2012:

  1. San Jose, California, which was the Best Performing Large city in 2001 reclaimed its position at the top after jumping up on the list by fifty spots. San Jose, according to Ross DeVol, the CRO at Milken “continues to have the top regional innovation ecosystem,” and shows that technology know-how continues to expand beyond Silicon Valley.
  2. Austin, Texas ranks number two on the list, even though future rankings are in jeopardy due in part to the slowing of natural gas and oil production.
  3. Raleigh, North Carolina has really been booming over the last decade and we don’t expect this city to drop down the list any time soon.
  4. As with Austin, Houston, Texas tops the list as a prospering city, but with an economy that relies heavily on natural gas and oil production.
  5. The nation’s capital, Washington, D.C. comes in as number five.

These are the Top 5 Small Performing Metros:

  1. Logan, UT
  2. Morgantown, WV
  3. Bismarck, ND
  4. Odessa, TX
  5. Fargo, ND

In 2012, not surprisingly, it was found that communities and industries that embrace technological innovation have a clear advantage, and the survey also highlights that both tech and manufacturing are on the rise. The rise of investments in business equipment in general, and information technology and software in particular, has presumably been one of the key findings that can be attributed to the economic recovery, as businesses resumed updating IT equipment which might have been deferred. It becomes no surprise that these tech embracing cities advanced in 2012 when you recognize the environmentally friendly innovations that run them efficiently for a sustainable future. As these, and other top metropolitan areas around the globe continue to embrace an advancing, eco-friendly world, they will create jobs, increase wages and create an economically sustainable environment that is compatible with the latest technology. A recovery in traditional manufacturing is crucial as well, especially the automotive industry and heavy capital goods such as mining equipment.

Check out the whole study to see all the top performing cities. The knowledge gained from this research can be used by businesses, government, academics, public-policy groups and investors like Andrew Rivkin to assess, understand and learn from each city’s performance in relation to one another. The study doesn’t just give us a list of the top performing cities; it also provides data that can help improve a region’s performance as well as understand economic opportunities as we recover from the financial crisis of our generation’s recession.