The top 3 cities for new grads: 'I can afford the house I want and the life I want'
This college graduation season, the class of 2023 is on the move.
Nearly half of 2023 college grads say they'd be willing to relocate to a new city for a job or to further their education, according to a survey of more than 2,000 graduating seniors from ZipRecruiter, the online jobs site. Early signs indicate that, in response to pandemic shifts in daily work and life, including the rise of remote work, the youngest members of the workforce could be more open to living in smaller rising cities than ever.
Today's college graduates are confronting an uncertain economy. Some 83% of students surveyed by ZipRecruiter say inflation and living costs are making them re-think their post-graduation plans — 1 in 3 say they're looking to move to a cheaper city after school.
To figure out where today's youngest professionals may have the best time getting settled based on those concerns, personal finance site SmartAsset analyzed the U.S. Census and MIT data to find the top metro areas for the class of 2023.
Researchers ranked metro areas based on three factors:
- Jobs, measured by median earnings and the unemployment rate for college grads
- Affordability, measured by MIT's living wage calculator that considers essential costs for one adult with no children
- Fun, measured by the percentage of the population between 20 to 29 years old, and the number of bars, restaurants and entertainment venues per capita
In many cases, metros that stand out in one area score poorly in the other two. To find the most well-rounded areas to enjoy a high quality of life relative to their earning power, new grads might want to look to Sun Belt and Midwestern college towns.
Based on the data, the No. 1 best metro area for new grads in 2023 is the area surrounding Lubbock, Texas. Bloomington, Ill., comes in second, while Kalamazoo, Mich., rounds out the top three.
Overall, college towns in the Sun Belt and Midwest tend be good places for new grads to settle because those areas cater to a younger demographic in terms of affordability and entertainment, says Jaclyn DeJohn, managing editor of economic analysis at SmartAsset. Industries generally center themselves where educated populations reside, and companies partner with universities to hire young talent.
Data is one thing, but what is it actually like to be a young person living in these areas? CNBC Make It spoke with 20-somethings living in each city at the center of the top metro areas for new grads for a look into what it's like to live, work and play there.
Big-city attractions with a college-town price tag in Lubbock
With a population of 326,546, Lubbock is the biggest metro area that ranks well for new grads. Roughly 1 in 5 residents is in their 20s, which makes it a good place for new grads to find friends and build a social circle, DeJohn says.
It ranks highly across the board for jobs, affordability and fun, landing in the top 27 out of 188 for each subranking. "Other cities did great in one or two areas max, but Lubbock offers the whole package," DeJohn says. Its high placements across the board is "the best combination" and "unheard of compared to the rest of the places."
Even those who leave find reasons to return.
Ryan Lewis, 23, grew up in Lubbock and moved to study public relations at the University of Oklahoma. She graduated in 2020 and spent a few years in Dallas, but soon realized the bigger city wasn't for her.
She prefers a slower pace where it's easier to connect with others, and the affordability of a smaller town can't be beat: "The cost of living in places like Dallas is so crazy high for people in their 20s just out of college and starting their careers."
She returned to Lubbock in early 2023 where her dollar goes much farther. She used to pay $1,500 to split an apartment with two roommates in Dallas but now pays about $1,000 to share a house with a backyard with one person. Her new roommate is another childhood friend making her return after moving away to Florida for school.
Lewis now works for the Lubbock Economic Development Alliance and Visit Lubbock, the city's conventions and visitors bureau, which gives her a behind-the-scenes look at major downtown revitalization efforts and a sprawling business community.
Through her work and social life, she gets a front-row seat to new restaurants, bars, entertainment spaces and hotels opening up around town. Roughly 41,000 students attend Texas Tech every year, and as a result, "a lot of business owners and realtors are catering their assets towards people in their 20s," Lewis says.
Lewis says the biggest misconception people have about her hometown, and where she's returned to plant roots, is that there's nothing to do, though she cites local wineries, museums, music venues, historical sites and community events that draw people around her age together.
"People think Lubbock is a boring city with dirt blowing everywhere, but there's so much to do here as long as you put in the time and effort to find something you enjoy," she says.
'The perfect middle ground': Affordable homes, big-name employers in Bloomington
Bloomington, home to Illinois State University, stands out for its strong job market. Residents have pretty high earning power relative to the rest of the U.S.: A college-educated worker in Bloomington earns a median of $72,333 per year, compared with the national median earnings of $59,717.
Landmark employers like State Farm Insurance, which is headquartered in Bloomington, as well as Rivian, the electric vehicle maker, help to bring in new and young career-oriented residents, too.
The university brought Melissa Douglas, 24, from the Chicago area to Bloomington in 2019. By her senior year of college, she knew she wanted to put down roots in the city and decided to stay after graduating in December 2022.
Though she grew up near a big city, she prefers the small-town feel of Bloomington. The housing market is relatively affordable and growing, which is why Douglas got her real estate license while in school and began practicing in January 2023.
Bloomington was named the No. 2 emerging housing market for the spring of 2023, with a median home listing price of $339,000 in March, according to an index from The Wall Street Journal and Realtor.com. Nationwide, the median home listing price was $424,000.
Many of the clients Douglas works with are young homebuyers around her age and just out of college or grad school. Douglas currently lives with her boyfriend and his family while he finishes his undergraduate degree, and she feels confident they'll be able to buy a starter home in the area after he graduates in December. ("He works in construction management and will have no problem getting a job here," she says.)
Douglas feels it's "pretty common throughout my generation" to not strive for big-city living. "I could live a comfortable lifestyle like I did growing up without having to make as much money," she says.
"Here, I know I can afford the house I want and the life I want," she adds. "This is the perfect middle ground."
A burgeoning food scene in Kalamazoo entices young entrepreneurs
Kalamazoo, another college town with plenty of jobs, affordable living and 20-somethings, ranks highly for "fun," thanks to a big restaurant scene especially appealing to young people — and young entrepreneurs.
The food scene helped Derick Waters, 28, see a future for himself in Kalamazoo. He grew up in nearby Battle Creek, Mich., but moved away to Arizona after high school to work as a personal trainer. He returned to Battle Creek in 2018 to pursue a dietetics degree until Covid waylaid him.
He took a semester off in 2020 and channeled his energy into a YouTube channel for vegan cooking. While researching commercial kitchen spaces to rent out to film his videos, Waters came across what's now called Can-Do Kalamazoo, a business incubation program. After a 16-week course, Waters secured a kitchen space, got a license to sell food and launched Dirty Vegan, a plant-based comfort food stand.
Waters runs Dirty Vegan with his girlfriend, Nina Martinez, and they're now gearing up for their second season selling at farmers markets and other community events. In the off-season, they hope to join another emerging scene in micro-brewing.
"The restaurant business and brewing world is a booming industry in Michigan," Waters says, which presents both entertainment and business opportunities.
Martinez, 27, hopes to one day open her own art and clothing boutique. She moved from Lake Odessa, Mich., to Kalamazoo for college nine years ago and was surprised by how tight-knit the community is. "People know the mayor on a personal level," she says.
Kalamazoo's thriving small-business community, particularly for restaurants, is almost counterintuitive to how well it caters to a younger crowd. "In general, I find restaurants tend to be correlated with an older population that has higher disposable income," DeJohn says, "so it's interesting to see Kalamazoo have a high propensity for restaurants despite a young population."
Waters' long-term goal is to build his business — he's looking into getting a food truck — and become a new staple of the Kalamazoo community.
"There's a ton of new people moving in and out all the time," he says. "There's a ton to do, and the environment is always changing."
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