Top Economic Metro Area Findings – source data included

[Ryan Daigle]

I've been doing some research and number crunching on the economic strength of the various MSAs as I look for favorable rental markets. While I acknowledge that economic strength is just one facet of a good rental market, it is a major factor and I wanted to share what I've found (the details of my methodology and raw data can be found after the various rankings):

Top 10 best economies

1. Provo-Orem, UT
2. Salt Lake City, UT
3. Charlotte-Concord-Gastonia, NC-SC
4. Chicago-Naperville-Elgin, IL-IN-WI
5. Dallas-Fort Worth-Arlington, TX
6. Kansas City, MO-KS
7. Longview, TX
8. Louisville/Jefferson County, KY-IN
9. San Francisco-Oakland-Hayward, CA
10. Birmingham-Hoover, AL

There were two main factors to overall economic strength that I looked at – how diverse/broad the economy is and how many economic drivers (i.e. strength) the area has. The rankings for each of these individually is:

Top 10 broadest economies

1. San Diego-Carlsbad, CA
2. Bellingham, WA
3. Santa Rosa, CA
4. El Campo, TX
5. Boise City, ID
6. Reno, NV
7. Pampa, TX
8. Burley, ID
9. Missoula, MT
10. Naples-Immokalee-Marco Island, FL

Top 10 strongest economies

1. Duncan, OK
2. Boston-Cambridge-Newton, MA-NH
3. Frankfort, KY
4. Indiana, PA
5. Madison, WI
6. Provo-Orem, UT
7. Salt Lake City, UT
8. San Francisco-Oakland-Hayward, CA
9. Barre, VT
10. Birmingham-Hoover, AL

Data

You can find all the data and calculations in this shared spreadsheet: https://docs.google.com/spreadsheets/d/1ty2bMCNyQF...

Feel free to copy it to your account if you want to tweak the numbers or dig in yourself.

Methodology

These rankings were all compiled from the 2015 SUSB Annual Data Tables: https://www.census.gov/data/tables/2015/econ/susb/... (I do acknowledge this is almost 4 years out of date now but it's the best I could find).

"Economic breadth" is measured on two axes – how much any single industry dominates the economy and how much any single size of company dominates the economy. The more variety there is to the number of major industries and types of companies in a market, the better their economic breadth is considered to be.

"Economic strength" is measured as the number of employment driving industries, e.g., Finance, Manufacturing, Information, Mining, Oil & Gas, etc..., that are major factors in the local economy. The more of these industries that are present in a meaningful way, the stronger the economy is considered to be.

"Best economy" is calculated as an equal weighting of both economic breadth and economic strength.

*For further details, you can find specific calculations in the source of the spreadsheet shared above.

Inquiries

I am compiling additional data to continue my research on favorable rental markets including wage information, job growth, home prices, rental prices, etc... If you have any questions, or have interest in getting access to this additional data, please feel free to get in touch.