Top U.S. Cities: Salt Lake City is Back! Who's Next? We Hear Phoenix Coming
It took more than a year – 14 months to be exact – but the nation’s first major metro has recovered all of the jobs lost during the recession spurred by the COVID pandemic: Salt Lake City. Fueling that job return are shifts in migration. Uneven impacts on industries rippled through certain areas more than others as well. If we look closely, we can identify other locations primed to recover early as the economy’s momentum continues.
This isn’t without challenges. Immediate risks include inflation and a shortage of workers that will put businesses in some industries at risk of delayed recovery, such as:
- Restaurants and Bars
- Transportation and Warehousing
Talent acquisition professionals who can pinpoint the best locations to target recruitment efforts and source talent will have an advantage. With job openings at record highs, luring workers in with competitive wages and overcoming the skills mismatch is critical to the labor market’s recovery.
Key Hiring Statistics
Click on the dots in the map to see key hiring stats for the 50 largest labor markets in the U.S. Below the map, find out which labor markets topped LaborIQ’s lists for these metrics in June 2021. All figures used are seasonally adjusted.
ThinkWhy’s talent intelligence software, LaborIQ®, assesses the health of job markets based on the:
- Number of new jobs added
- Percentage of growth in jobs from the prior period
- Current employment level compared to the pre-pandemic level
Most New Jobs Added
The highest volumes of new jobs are influenced by a location’s population. Los Angeles had held the top spot since February but, in June Phoenix and Atlanta’s big gains took the top two spots.
By sheer volume, larger markets will continue to lead in job gain even though the pandemic had a unique impact on the workforce in these locations. A significant number of jobs is expected to be added in these locations over the next few years, driving strong demand for talent acquisition professionals.
Best Month-to-Month Improvement
June metro-level employment data, combined with LaborIQ’s analysis of the nation’s top 50 most populous metro areas, show the following cities leading in job growth.
The locations growing the fastest on a relative basis tend to be a strong indicator of how quickly the available talent supply is shrinking. For Phoenix and Atlanta to be at the top of the two lists is an indicator of the strong local economic rebound. Phoenix has also recouped nearly all of the jobs lost during the pandemic, which leads us to our final metric.
Pre-pandemic Employment Levels Comparison
Another indicator that sheds light on the availability of talent is how the current employment level compares to that of February 2020, just prior to the pandemic economic fallout. This metric may not shift drastically month-to-month, but it is worth keeping an eye on these metros because their talent supply is tightening.
In fact, in June Salt Lake City became the first of what LaborIQ® expects to be a handful of metros to recover all jobs lost in 2021. Businesses in these cities will likely search for workers in other metros to relocate or work remotely to keep up with demand. Salt Lake City is a prime example of how migration and remote work have impacted the labor market.
Another noteworthy mention is Phoenix. The only metro to place in the top five on both lists and with significant improvement in June, it jumped to second place and is less than 1% shy of recovering all jobs. Not only did Arizona end federal unemployment benefits on July 10 but also offered bonuses to return to work at the expiration of that income.
LaborIQ lists the following five cities as being closest to their pre-pandemic employment levels.
While the lists above focus on the top five markets, refer to the map above to find opportunities for your business. Locations underperforming in these categories, particularly related to pre-pandemic employment levels, may have a desirable talent pool or customer base for your business.
Many metro areas experienced improved job gains in June compared to the underwhelming job gains in May but face challenges posed by labor shortages and increasing costs for material and labor. But market demand for labor is increasing.
To combat what some see as blockades to the labor supply resurgence, June and July saw supplemental federal unemployment benefits end in nearly half the states. Many of the top metros listed above are located in these states. For example, Arizona and Georgia ended additional benefits early and experienced strong gains in two of each state’s largest metros. It remains to be seen if this change will fuel meaningful growth in all such states, and upcoming data will reveal the impact.
Additional factors affecting the labor market’s health and recovery include record quits (voluntary departures) and worker confidence in obtaining higher wages or desired workplace flexibility. Faced with reversals of remote work by some companies, employees are opting to find businesses in support of remote or hybrid options.
In all, demand for hiring has never been stronger, but supply challenges will persist for at least the next few months. Additional job gains are expected in the near term, adding to the job market’s strong June outcomes.
LaborIQ by ThinkWhy continuously forecasts and reports labor data at all levels, measuring impact to cities, industries, occupations and businesses across the U.S.