You know the problem — the places in the U.S. that are the most affordable to live in don’t usually have the kind of job opportunities that would make you want to live there.
So, what kind of places are we talking about?
A new report from Indeed Hiring Lab chief economist Jed Kolko makes that clear, because Kolko adjusts average salaries in local markets for their cost of living. He not only breaks out the most affordable places to live, but also which metro areas will give you the most bang for your buck and a better job/hiring environment as well.
However, he opens with this insight into where the best overall (non-adjusted) salaries are, just in case you haven’t been paying close attention:
“Before adjusting for cost of living, America’s highest salaries are in metro San Jose, the heart of Silicon Valley. To see this, we calculated the average salary for all Indeed job postings between July 2017 and June 2018 that included information on annual salaries, accounting for differences in the local job mix. For the same occupations, salaries are on average 19 percent higher in San Francisco than in San Antonio and 18 percent higher in Boston than in Cleveland.
But San Antonio and Cleveland are cheaper than San Francisco and Boston. Housing costs less, as do other goods and services. Adjusted for living costs, salaries are actually 11 percent higher in San Antonio than in San Francisco and 5 percent higher in Cleveland than in Boston.”
Top 10 Metro Areas With Highest Adjusted Salaries
Jed Kolko’s point in this report is pretty clear: It’s not all about where you can make the most money, but rather, where you can maximize your salary and also have a moderate cost of living. That’s why he “adjusts” overall salaries with cost of living to come up with his lists.
For example, here are the top 10 U.S. metros where adjusted salaries are the highest, although the places on this list are typically smaller (none have more than 1 million people), and tend to have higher unemployment and projected slower job growth.
- Harlingen-Brownsville, Texas — $80,880;
- Kingsport-Bristol-Bristol, Tennessee-Virginia — $80,061;
- Huntington-Ashland, West Virginia-Kentucky-Ohio — $79,028;
- Merced, California — $78,983;
- Spartanburg, South Carolina — $78,121;
- Hickory-Lenoir-Morganton, North Carolina — $76,833;
- Gulfport-Biloxi-Pascagoula, Mississippi — $76,386;
- Toledo, Ohio — $76,375;
- Birmingham-Hoover, Alabama — $76,142;
- South Bend-Mishawaka, Indiana-Michigan — $75,942
I’m sure all of these areas have some wonderful qualities, but there are a lot of reasons why they might not be the best places for someone to live and work, despite the fact that adjusted salaries are pretty high there. Jed Kolko makes this very point in his analysis of the data when he writes:
“Before you reserve that one-way U-Haul to take you to Kingsport, know this: places where adjusted salaries are higher often serve up other challenges. They tend to have higher unemployment today and are projected to have slower job growth. If you want it all — high adjusted salaries, low unemployment today, and good future prospects — look instead at Duluth, Minnesota, Wilmington, North Carolina, and Lubbock, Texas.
And let’s be realistic. You might not want to trek across the country, far from family, friends, or weather you love, to a place where jobs in your field are scarce. That’s fine. You can probably move somewhere not too far away with a similar mix of jobs and boost your standard of living at the same time — for example, by relocating from Tampa to Birmingham or from San Diego to Sacramento. Most places have relatively close-by sister cities where adjusted salaries are at least a bit higher.”
Top 10 Areas With Good Salaries and Job Possibilities
Want more on these areas with decent pay and better employment possibilities? Here is the Jed Kolko’s Indeed list of the Top 10 metros with adjusted salaries, better-than-average unemployment, and future growth possibilities:
- Duluth (pictured) — $75,910;
- Wilmington — $72,392;
- Lubbock — $72,340;
- San Antonio-New Braunfels — $72,022;
- St. Louis — $71,681
- Sacramento-Roseville-Arden-Arcade — $71,553
- Little Rock-North Little Rock-Conway, Arkansas — $70,786;
- Salem, Oregon — $70,589;
- Kalamazoo-Portage, Michigan — $70,243;
- Gainesville, Florida — $69,993.
Here’s my take: Although many job candidates simply take the job with the best compensation regardless of where it is, for the greater majority of candidates, the process is a lot more nuanced. Salary, benefits, cost of living, and quality of life are generally the factors that most job seekers focus on when they’re looking to make a change.
This is especially true for millennials and younger workers.
For example, I currently live in the greater Los Angeles area, and I have also lived and worked in San Francisco, San Diego, and Honolulu — all metro areas with a high cost of living where salaries simply don’t go as far. But even for me — someone you might think has some financial tolerance for expensive places — cost of living and quality of life are still huge issues if I were considering a new position in, say, Boston or Washington, D.C.
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That’s why the Indeed survey also has a list that compares the biggest adjusted salary gaps between pairs of nearby metro areas.
In Job Hunting, Nothing Is Ever Equal
It’s too much to detail that list here — and you really should go and get the full report on Indeed if you’re interested — but it shows the top markets that candidates might want to consider if they live nearby — with “nearby” meaning within 5o0 miles. These are metro areas (with populations of 250,000 or more) that are less than 500 miles apart and have more than a 75 percent overlap in occupational list of job postings.
For example, these are paired markets such as Cape Coral-Fort Myers, Florida and Miami-Fort Lauderdale-Palm Beach, Cincinnati, Ohio-Kentucky-Indiana and Philadelphia-Camden-Wilmington, Pennsylvania-New Jersey-Delaware, and Birmingham-Hoover, and Jacksonville, Florida.
As Jed Kolko’s analysis point out:
“These are moves that get you a higher standard of living and similar job opportunities — all just a short flight or day’s drive away. Those adjusted-salary differences might sound small relative to the gap between extremes: Brownsville’s adjusted salaries are 51 percent higher than Honolulu’s, and Kingsport’s are 37 percent higher than those in Santa Cruz. But you’d need to move a long distance to a very different labor market — and hope to find a job that fits you — in order to claim that higher standard of living.
All else equal, a higher adjusted salary is better than a lower one. But in job hunting — like so many other things — all else is never equal.”
Amen to that. Nothing in job hunting is equal, it seems, and this Indeed analysis of the top metro job markets by adjusted salaries and job opportunities makes that perfectly clear.
It’s worth taking a look at, and you can find the full Indeed survey report by Jed Kolko here.
Salary data are from all job postings with annual salaries on Indeed between July 2017 and June 2018. Unadjusted average salaries are based on weighted median deviations across occupations, which accounts for the different mix of job titles across metros in order to make an apples-to-apples comparison of unadjusted salaries.
Local cost-of-living data are from the U.S. Bureau of Economic Analysis regional price parities for 2016, released in May 2018. These cost-of-living data reflect local differences in the price of housing, other services and physical goods. Unemployment data are from the U.S. Bureau of Labor Statistics and are not seasonally adjusted, unlike the published headline rate. Projected job growth is from Indeed’s analysis of Bureau of Labor Statistics projections. All 185 U.S. metropolitan areas with at least 250,000 people are included in the rankings.