Houston, Philadelphia, and Austin, Texas, could be good places for college graduates to land their first post-graduation job or for young job seekers in general if they're worried about cost of living or their earnings amid elevated yet cooling inflation.
Gusto, a payroll and HR platform for small and mid-sized businesses, analyzed city-level data to see which places may have good opportunities for these new job seekers.
"These new graduates are entering the labor market at a time when the economy's undergoing a profound shift," Luke Pardue, an economist at Gusto, told Insider. "By some measures, it's never been easier to find a job with record low unemployment rates and high levels of job openings, but they're entering the labor market at a time when companies are also pulling back on hiring amid a lot of economic uncertainty."
"This isn't the labor market of the 2008 recession, but it's also not the labor market of last year, two years ago when employers were incredibly eager to scoop up new workers," Pardue said.
So, according to Pardue, they might have to think about industries or locations that they might not have been considering after earning their degree.
"We took a look this year at some of the areas where these new graduates could get the biggest bang for their buck because there's been so much conversation around inflation and how that's eaten into people's budgets," Pardue said. "Especially when these workers are young, it's really important to keep an eye on their finances because this is the time they have to save money and to save for the future."
To do this, Gusto looked at the 50 largest metro areas and what full-time hiring rates look like for young workers, including both college grads and non-grads. Gusto then sorted the 10 locations with the highest share of new hires getting full-time jobs by the average salaries that were adjusted by cost-of living indexes to see where these job seekers can get the biggest value.
While Houston ranked No. 1, New York City ranked No. 10 on Gusto's salary list. Gusto's new analysis stated that "after taking the cost of living into account, new graduates in Houston make an average of $65,648, compared to just over $31,000 in New York City." The salaries used in the analysis are based on data from Gusto's platform and were adjusted using cost-of-living indexes from C2ER.
The new report noted San Jose, California, as the city with the highest average full-time hiring rate between early 2022 and early 2023 for 20-24 year olds among major metros. For Houston, this rate is 8.5%, but 9.6% in San Jose.
The following are large cities with high full-time hiring rates for young workers where the class of 2023 and young job seekers can get the biggest bang for their buck, per Gusto's analysis.