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Best Places for New College Grads – 2023 Study

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Written by Patrick Villanova, CEPF®
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A silhouette with wearing a graduation cap looks into the horizon.

College graduates are under immense pressure to land a job right out of college, especially during economic downturns, when the job market may be less stable. However, it’s not just the job itself graduates have to think about. Figuring out where to live often goes hand-in-hand with starting a career, developing a network and maybe even laying down roots.

With this in mind, SmartAsset analyzed data for 187 metro areas across the country to identify the best places for recent college graduates. We compared the job environment, cost of living and entertainment factors in each to determine which are best for people with a bachelor’s degree.

Key Findings

  • Midwestern metros dominate the top 10. Seven of the top 10 best places for college graduates are located in Midwestern states, predominantly due to the combination of a fruitful job market, reasonable cost of living and social factors. These areas – like Bloomington, Kalamazoo and Eau Claire – tend to be established college towns.
  • The Kennewick-Richland metro area has the best job market, with college graduates earning $70,000 and only a 1% unemployment rate. Regionally, the midwest – particularly Wisconsin metro areas like Racine, Appleton and Madison – ranked highly for job markets.
  • San Jose had the highest median wages for college graduates at $102,000. This is just about double the cost of living in San Jose. The second highest wages trailed behind that at $80,000 in the D.C. metro area. Bridgeport ($80k), Seattle ($79k) and Boston ($75k) areas placed third, fourth and fifth, respectively. St. George, Utah had the lowest wages for college graduates at $40,000.
  • Ten metro areas had an unemployment rate of less than 1% for college graduates. The Sioux City metro area’s unemployment was as low as 0.1%. Other southern and midwestern areas that made the cutoff include the Jackson, TN, Champaign, IL, Athens, GA, Victoria, TX, and Boise, ID metro areas.
  • The cities with the lowest cost of living offer median earnings around $50,000. El Paso, TX, Canton, OH, Youngstown, OH and Jackson, TN offer the lowest premiums on necessities like housing, food, medical care and transportation. The cost of living in these areas is estimated at about $30,000.

Best Cities Overall for Recent College Graduates

The cities were ranked based on their scores among three subcategories: Jobs, Affordability and Fun. Each subcategory includes several variables listed below in Data and Methodology.

  1. Lubbock, TX Metro Area
    Lubbock scores consistently across Jobs (25th), Affordability (27th) and Fun (26th), giving it overall the best combination of traits for college graduates. Grads earn a median $57,574 in annual wages, while the cost of living is a fraction of that at nearly $32,000. The unemployment rate for college grads is 1.7%.
  2. Bloomington, IL Metro Area
    The Bloomington metro area ranks so highly in part to the balance between a particularly high Fun rating and one of the highest median incomes for college graduates. People 25 and older with a bachelor’s degree typically earn $72,333 per year – seventh most across our study. State Farm Insurance, whose headquarters are in Bloomington, is the area’s largest employer with over 14,000 employees1.
  3. Kalamazoo-Portage, MI Metro Area
    Home to Western Michigan University, the Kalamazoo-Portage metro area ranks second overall thanks to its high percentage of young people and high number of restaurants. While Kalamazoo-Portgage has the sixth-most restaurants per capita across our study, nearly 19% of its residents are in their 20s (15th highest). Meanwhile, the area is also in the top 25% for entertainment establishments per capita.
  4. Eau Claire, WI Metro Area
    If you’re looking for a solid bar scene, Eau Claire’s got the most bars per capita of all. And while this area is just a fraction of the size of other metros with about 170,000 residents, its cost of living for a single adult with no children is relatively low at $31,817 annually.
  5. Oshkosh-Neenah, WI Metro Area
    Following Eau Claire, Oshkosh-Neenah ranks second for most bars per capita. However, the cost of living is higher at $33,017 annually. The median salary for college graduates is $56,123, and the corresponding unemployment rate is just 1.4%.
  6. Fargo, ND-MN Metro Area
    Nearly 18% of Fargo’s population is between the ages of 20 and 29. Home of North Dakota State University, the area ranks 11th for cost of living at $51,181. There are plenty of bars and entertainment venues in this 270,000 person metro.
  7. Waco, TX Metro Area
    Waco’s cost of living helps bring it to the top 10, with $31,995 needed for an adult to get by for a year. Graduates in Texas can enjoy the perk of no state income tax, helping stretch the value of their dollars relative to other places. While the unemployment rate for grads is 3%, their median annual wages are $55,695.
  8. Iowa City, IA Metro Area
    Iowa City has a lot of young people: It ranks fourth for population aged 20-29, with just about 22% of the roughly 177,000 population in this demographic. The median wage for college graduates is $57,237.
  9. Amarillo, TX Metro Area
    Located in the panhandle of North Texas, the Amarillo metro area is home to over 270,000 people. The area has the eighth-lowest cost of living – a single person with no children needs just $31,228 in pre-tax income to support themselves. Meanwhile, people 25 and older with bachelor’s degrees in Amarillo earn a median income of $57,212, which is higher than more than half of the metro areas in our study.
  10. Fort Wayne, IN Metro Area
    The unemployment rate in Fort Wayne is just 1% for college graduates. A person would need $31,959 to get the basics here annually, while earning a median $52,281. Overall, it ranks 28th for Affordability.

Best Places for Jobs

These metro areas have combinations of the lowest rates of unemployment and highest median incomes for bachelor’s degree holders aged 25 and older.

  1. Kennewick-Richland, WA
  2. Des Moines-West Des Moines, IA
  3. Racine, WI
  4. Appleton, WI
  5. Salt Lake City, UT
  6. Madison, WI
  7. Rochester, MN
  8. Beaumont-Port Arthur, TX
  9. St. Joseph, MO-KS
  10. Ogden-Clearfield, UT

Best Places for Affordability

The affordability metric includes costs for a variety of necessities, including housing, food, transportation, medical care and miscellaneous costs for a single adult with no children within a metro area.

  1. El Paso, TX
  2. Canton-Massillon, OH
  3. Youngstown-Warren-Boardman, OH-PA
  4. Jackson, TN
  5. Brownsville-Harlingen, TX
  6. Toledo, OH
  7. Jonesboro, AR
  8. Amarillo, TX
  9. Fort Smith, AR-OK
  10. Johnson City, TN

Best Cities for Fun

The population of residents aged 20-29 is included in the Fun metric, as are restaurants, bars and entertainment venues per capita.

  1. Missoula, MT
  2. Champaign-Urbana, IL
  3. Iowa City, IA
  4. Fort Collins, CO
  5. Flagstaff, AZ
  6. Madison, WI
  7. Bloomington, IL
  8. San Antonio-New Braunfels, TX
  9. Bellingham, WA
  10. Kalamazoo-Portage, MI

Data and Methodology

To evaluate overall rankings, we broke our metrics down into three subcategories: Jobs, Affordability and Fun.

Jobs defines the career opportunities and stability within a local economy, and consists of:

  • Unemployment: Unemployment data is for people aged 25-64 that hold a bachelor’s degree or higher. Data is sourced from the U.S. Census Bureau 2021 1-Year American Community Survey.
  • Income: This is the median earnings of bachelor’s degree holders aged 25 or older. Data is sourced from the U.S. Census Bureau 2021 1-Year American Community Survey.

Affordability evaluates the costs of living in a particular metro area. This data comes from MIT’s Living Wage Calculator for 2022 and incorporates the costs of housing, food, medical care, transportation and other miscellaneous necessities.

Fun measures local demographic and business metrics to evaluate general social potential and includes:

  • Population aged 20-29: This measures the percentage of the population that falls between age 20 and 29. Data comes from the U.S. Census Bureau 2021 1-Year American Community Survey.
  • Restaurants: This is the number of restaurants per capita. Restaurant data comes from the County Business Patterns 2020 Survey from the U.S. Census Bureau.
  • Bars: The number of bars per capita. Data comes from the County Business Patterns 2020 Survey from the U.S. Census Bureau.
  • Entertainment venues: The number of entertainment venues per capita, sourced from the County Business Patterns 2020 Survey form the U.S. Census Bureau.

Footnotes

1Annual Comprehensive Financial Report of the City of Bloomington, Illinois. April 30, 2022
2City of Toledo 2021 Annual Comprehensive Financial Report
3City of Greenville Annual Comprehensive Financial Report. June 30, 2022

Financial Tips for College Graduates

  • Start saving for retirement. It may not be exciting advice, but saving for retirement early in your career is one of the best financial moves you can make. Be sure to contribute to your workplace retirement plan, at least enough to qualify for your company match, if your employer offers one. Keep in mind that for every dollar you save at age 25, you could have $4.80 by age 65, even after accounting for inflation, according to Vanguard.
  • Focus on paying off debt. If you have credit card or college loan debt to pay off, concentrate on getting rid of it as quickly as possible. Monthly debt payments sap your ability to save and invest your money for the future.
  • Consider working with a financial advisor. Financial advisors aren’t solely for retirees or the ultra wealthy. An advisor can help you set financial goals and put your money to work for you in an investment portfolio. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.

Questions about our study? Contact us at press@smartasset.com

Photo credit: ©iStock.com/nirat

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