Utah’s economy is distinguished as the best in the nation for its strong business environment and job creation growth. The Best-Performing Cities 2024 report by the Milken Institute focuses on sustainable growth and resilience in U.S. metropolitan areas, and showcased Utah once again. The 403 cities surveyed in the report were placed in their rankings regarding opportunities for job growth, wages and high-tech industry growth.
Utah stood out in the report for making two out of the top five spots in this year's rankings for large city growth and fourth in the small cities growth category.
Top 5 large cities:
- Austin-Round Rock, Texas.
- Raleigh, North Carolina.
- Boise City, Idaho.
- Salt Lake City, Utah.
- Provo-Orem, Utah.
Top 5 small cities:
- Idaho Falls, Idaho.
- Coeur d’Alene, Idaho.
- Gainesville, Georgia.
- St. George, Utah.
- Twin Falls, Idaho.
Salt Lake City’s jump in the ranks
Utah’s capital has seen remarkable growth, particularly in high-tech GDP and wages over the past five years, which propelled the city up in the rankings, surpassing Provo for the first time since 2012.
Salt Lake City’s low economic inequality has allowed it to thrive during and after the COVID-19 pandemic, giving it the bolster it needs to combat future economic shocks.
However, “A slowdown in job growth during the later part of 2022 and early 2023, partially caused by tech layoffs, is cause for concern for the Salt Lake City economy, which in the past has been bolstered by strong growth of the high-tech sector,” the report found.
Provo-Orem loses No. 1 ranking
The popular college area lost its three-year reign as the top-performing large metropolitan area, dropping to fifth place.
Although Provo boasted one of the country’s most rapidly expanding employment sectors, securing the second spot in job growth and the third in wage increases over a five-year period, other factors caused the Provo-Orem area to lose its lead.
“This year’s drop in Provo’s position on the BPC ranking is due to notable falls in its one-year job and wage growth,” according to the report. “The slowdown in Provo’s labor market performance has extended into mid-2023 as signaled by its relatively low (compared to last year) performance in short-term job growth, which accounts for employment growth from August 2022 to August 2023.”
Provo-Orem still maintains a prosperous tech sector with a significant presence of tech giants like Qualtrics and Vivint. The area has faced challenges from tech layoffs and tightening in the high-tech sector, similar to Salt Lake City, impacting its labor market performance.
St. George, a robust small city
The southern Utah city went down one ranking from 2023 to 2024 but continues to show strong labor market performance, ranking second among small cities in five-year job and wage growth.
Despite its small high-tech sector, the city has seen rapid growth in high-tech GDP, mainly attributable to its computer systems design and architectural/engineering sectors.
That being said, the city is not without its challenges. “Its housing supply has struggled to keep pace with demand, with the city ranking 125th among small cities in housing affordability. St. George also faces an uncertain water future,” the report said.
The report added, “The city relies on the Virgin River (a tributary of the Colorado River) for the predominant share of its water supply. Recent droughts, combined with the area’s high growth, have put an excessive burden on the Virgin River’s capacity, leading city officials to warn that water shortages could limit the city’s future growth.”