Despite a broadly slowing labor market, certain U.S. cities are bucking the trend, with competition for workers heating up.
According to payroll services firm ADP research, some unexpected regions are showing impressive pay growth and hiring rates, underscoring how the job market can vary dramatically across the country.
Denver topped the list as the hottest hiring market, with 5.8% annual pay growth, $19 per hour for new hires, and a monthly hiring rate of 4.5%. Other top cities with significant pay growth included Oklahoma City, Las Vegas, Seattle, and Portland, each posting annual pay increases of over 5.4%. These cities are thriving in the current economic climate, offering opportunities for job seekers with rising wages and consistent hiring, the Business Journals reported.
However, not all markets are experiencing this boom.
Cities like Providence, Rhode Island, Tampa, Florida, and Baltimore saw lower pay raises and hiring rates. Liv Wang, lead data scientist at ADP Research Institute, explained that these regions haven’t seen the same recent growth, but that doesn’t mean they are struggling. Factors like affordability and internal migration can shift labor markets, helping to ease labor shortages in some areas, even without wage increases.
Cities with higher living costs tend to offer the largest starting salaries. For instance, San Jose, California, tops the list with new hires earning an average of $25 per hour, followed by San Francisco at $21 per hour.
In contrast, cities like New Orleans and San Antonio had the lowest starting wages at $15 per hour. These disparities reflect the influence of local living costs on wages and job opportunities.
The job market is also showing sector-specific trends.
Manufacturing jobs in Austin, Texas, saw a remarkable 11% increase in pay, while Richmond, Virginia, experienced a 10.6% pay growth in the natural resources and mining sectors.
Conversely, Tulsa, Oklahoma, saw a decline in pay for natural-resources jobs, with a 1.7% drop over the past year. These fluctuations highlight how specific industries are thriving while others are lagging.
According to ADP’s findings, San Jose had the highest-paid new hires, with workers in the information industry earning an impressive $65.90 per hour. Given the area’s heavy focus on technology and Silicon Valley’s tech giants, this is no surprise, as tech companies continue to offer some of the highest salaries in the country.
This research is part of a broader picture of a slowing job market.
The U.S. Labor Department recently revised its new job reports downward by about 818,000, signaling a potential dip in overall employment growth. Despite this, workers are still seeking traditional employment opportunities rather than turning to side hustles or freelance work, according to Alex Cook, a small-business expert at H&R Block.
Small-business owners, in particular, are feeling the pinch.
With larger companies able to offer better wages and benefits, attracting top talent has become increasingly difficult for smaller businesses. Bill Dunkelberg, Chief Economist at the National Federation of Independent Business, stated that small-business owners are facing tough months ahead, with labor and cost pressures continuing to affect their bottom lines.
This article was written with the assistance of artificial intelligence.