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The Agurban

#677 – Where Small Town America is Thriving – Part One

Mar 13, 2018

We are starting a three-part series that features the research of Joel Kotkin, whom we have featured in the past. Mr. Kotkin is a Professor of Urban Studies at Chapman University in California, Executive Director of the Center for Opportunity Urbanism, and the executive director of newgeography.com. In addition, he is an internationally-recognized authority on global, economic, political and social trends. Part One of Mr. Kotkin’s recent report, Where Small Town America is Thriving, includes his top small-town picks in the energy sector. Other sector picks will be shared in Parts Two and Three.

Where Small Town America is Thriving – Part One

…America’s smaller communities are far more diverse — and have far greater potential — than is commonly believed. The resurgence of manufacturing and energy development has helped many smaller towns (these sectors tend to be more critical to smaller economies). Recent demographic data show a movement away from expensive coastal cities, including millennials, who tend to look for affordable single-family homes. The number of rural home mortgages has increased for five straight years, though the increase trails the rate in urban areas, and nearly twice as many millennials, according to the National Association of Realtors, bought home in small cities or rural areas last year than in denser urban areas.

Energizing Small City Growth

Many small cities present a promise of safety, quality education and work-life balance. The prospect of economic decentralization is a chance to leverage these qualities. However, success will not be evenly distributed. Only those small cities able to assemble the right mix of talent, market focus, and civic cooperation will succeed. Many small and rural places will not.

We have identified the stellar small places — metropolitan areas with populations between 12,800 and 300,000 – based on wages, and wage growth and job creation from 2007 to 2017. Even as most smaller towns have seen rather tepid job growth, these cities at the top of our list are outperforming not only their same-size counterparts, but some major urban competitors as well.

Surprisingly, our list of the best small areas for jobs does not include many of the scenic small communities that tend to attract affluent emigrés from large cities. Instead most of our leading areas from the last 10 years tend to be those driven by the energy industry, led by No. 1 Williston, North Dakota. With 36,000 people, Williston has been at the center of the shale oil boom in the state, growing its job count 121% since 2007. Wages have soared 47% to over $68,000, well above the national median income of $52,000.

Two other hot spots in North Dakota’s Bakken shale boom: No. 3 Dickinson and No. 6 Minot.

Texas oil towns also figure prominently: No. 2 Midland and No. 4 Andrews.

In addition to our overall ranking, we looked for the small cities with the strongest growth in particular sectors. Newton, Iowa, which ranks second on our list of energy cities, pivoted after the economic disaster of a shuttered Maytag plant to become a hub for wind power manufacturing.

Next week we will continue with Mr. Kotkin’s report, revealing his top picks for manufacturing cities and business and professional service hubs.