A new ranking by Magnify Money has Austin at the top of the list of boom towns in America. It’s no surprise, considering the financial services website’s definition of a boom town and the accomplishments that have put Austin on almost every “best cities” list in for the past few years. Although other Texas cities performed well in the ranking, Austin was by far the leader in Texas and throughout the country.
According to the report released with the ranking, Magnify Money wanted to see where “Americans are gathering now to take advantage of growing prosperity and improved lifestyles to achieve the American dream.” These cities represent the story of people “migrating to different cities and towns to build new lives through new opportunities.” It shows where people see the best opportunities for themselves and their families.
In order to find out which of America’s metros are booming, analysts looked at how much each metro has changed between 2011 and 2016 (the most recent year for which all data is available at the metro level). Their observations were broken down into three different categories, which were then scored independently before combining the results to reach a metro’s final score.
Austin’s Scores in the Analysis
- Austin scored a total of 93 out of 100 points for business growth
- For workforce earnings, Austin got a 73 out of a total of 100 points
- In the area of population and housing, Austin got a 100
Austin scored very highly across all three categories, which include business growth, workforce and earnings and population and housing. In business growth, analysts were not only looking at the number of new businesses present, but also at how those businesses are performing, as measured by their increase in hiring and how much revenue has increased. For the workforce and housing category, analysts looked at how the workforce has changed, along with improvements to the unemployment rate and the increase in earnings. Finally, the population and housing score was determined by looking at the Census Bureau’s American Community Survey (ACS) to measure changes in total population and the number of housing units.
Austin’s final overall score was an impressive 87.8 points. The next closest contender was Provo, Utah, which scored 75.7 overall.
The Austin Advantage
Magnify Money explained that Austin had a lead on the competition mainly because it showed the greatest five-year growth in population and housing of all metros reviewed, earning the Texas capital a perfect Population & Housing score of 100. The robust growth has proven to be a real challenge for developers to keep up with. In Austin, housing inventory has been below the level considered to be a balanced market by the Real Estate Center at Texas A&M University for years now. Low inventory and sustained housing demand have pushed up home values in the Austin area, but housing in the metro is still much lower than large cities that have typically been more popular for job seekers in the past.
Magnify Money also pointed out that the Austin population growth of almost 16% over a five-year period have made huge gains in the workforce, but the jobs market in the area is still strong. That, combined with a 23% drop in unemployment and an almost 9% increase in median wages, gave Austin the highest Workforce & Earnings score of 70.3 points on the list. While the metro comes in second for Business Growth, it’s with an A score of 93, thanks to a 21% increase in the number of businesses and a 24% increase in the number of employees those firms hired.
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