Raleigh tops Milken Institute ranking of top cities
Business NC 1/15/25
Raleigh’s relative affordable housing is a big factor in its jump to the No. 1 spot on the Milken Institute’s rankings of the country’s best-performing cities.
Raleigh ranked second in 2023, surging to the top after last year’s top-ranked city, Austin, Texas, slid to sixth. The Raleigh ranking reflects the metropolitan statistical area including Wake, Johnston and Franklin counties, which has a combined population of 1.5 million.
The adjoining Durham-Chapel Hill MSA came in 16th, up from 36th a year earlier. That includes Durham, Chatham, Orange and Person counties. It has a population of about 609,000.
Among other N.C. cities, Milken ranked Wilmington 13th (up from 21st), Durham/Chapel Hill 16th (up from 36), and Charlotte/Concord/Gastonia 24th (down from 10th). Slower job growth dented the Queen City’s ratings.
Milken bases the ratings on 13 metrics focused on three key topics: labor market performance, high-tech impact, and access to economic opportunities. It is a highly regarded rating among civic officials nationally.
Asheville dropped to 89th (from 61st) and Fayetteville rose to 98th (from 180th). The report said Fayetteville’s showing is partly a function of having seen strong growth in “high-tech industries over the past several years.”
The news wasn’t as good in the Triad or the foothills. The Hickory area ranked 175th (down from 115th), while Winston-Salem and Greensboro dropped to 179th and 187th (from 86th and 164th, respectively).
Winston-Salem had one of the biggest declines in the Milken rankings, Officials cited a “relatively large share of employment in the manufacturing sector, which has experienced low job growth in recent years.”
Among small cities, Jacksonville is a standout, coming in at No. 8. It has been getting more high-tech jobs in sectors like management, consulting and computer systems design, the report said.
Still, the city in Onslow County has an affordability problem that clouds its prospects, “with only 69.2% of households spending less than a third of their income on housing costs,” the report said.
Burlington clocked in at 17th in the small-city ranking (up from 75th) while Greenville held steady at 63rd. New Bern moved to 90th from 158th, Goldsboro was 160th versus 193rd, year and Rocky Mount was 179th versus 185th.
Austin’s job growth from 2023 to 2024 slowed to 1.4%, versus 2.8% in Raleigh. While the Texas capital’s housing affordability is declining, Raleigh through 2023 had “preserved its own” compared to many large-city peers, the Milken report says.
The report says 73.7% of Raleigh-area households can get by paying no more than 30% of their income for housing. That compares with 66.1% for Austin.
The report cautioned that in Raleigh, “housing prices have still risen sharply … since the onset of the pandemic,” in keeping with a national trend.
New housing construction there was projected to slow in 2024, so “maintaining its balance of growth and affordability will be key if Raleigh is to remain at or near the top of future rankings,” Milken’s analysts said.