Money is undoubtedly a priority for working professionals. Half of Americans said they would even accept a job with no paid time off, if they received more money in return. However, Indeed’s State of the Labor Market report found that salaries can only go so far in certain locations for every industry except tech.
SEE: Interview tips: How to land your next tech job (free PDF) (TechRepublic)
While big cities are known as hubs for innovation and opportunity, that doesn’t mean they are necessarily the most advantageous locations for professionals. While big cities may offer high salaries, once they are adjusted for cost of living, employees will find that the pay isn’t as impressive as they thought, the report found.
The report, released on Tuesday, analyzed Indeed salary data from all job postings that included annual salaries from April 2018 to April 2019; local cost of living data was sourced from the US Bureau of Economic Analysis regional price parities of 2017. While big cities do run the economy, according to the report, a small-city advantage exists when considering salary.
What is the small-city advantage?
After accounting for the cost of living in smaller cities, salaries end up being higher than those adjusted for big cities, the report found. This result creates a small city advantage for employees in those areas.
Before adjusting for cost of living, for example, the US states with the highest salaries included San Jose, San Francisco, and other California metros. However, these locations also have some of the highest costs of living, the report found.
When adjusted for cost of living, the results for metros with the highest salaries were completely different: Brownsville-Harlingen, TX; Fort Smith, AR-OK; and Huntington-Ashland, WV-KY-OH came out on top. All ten of the metros with the highest pay ended up being small- to mid-sized markets—none of which have more than a million residents—according to the report.
Unadjusted salaries were 7% higher in metros with at least two million people than in areas with fewer than 250,000; however, the salaries after adjusting for cost of living were 9% lower in big metros, according to the report.
Tech industry has no small city advantage
While the small city advantage is loud and proud for most industries, the same can’t be said for tech, the report found: Tech salaries are 27% higher in metros with two million or more residents than metros with fewer than 250,000 people. Even after the salaries are adjusted, the pay is still 5% higher in larger metros than in smaller cities. Boston and Washington, DC were the cities with the highest tech salaries.
The report identified the following 10 metros as the locations with the highest adjusted tech salaries:
This data revealed that occupations that pay more nationally, as many tech jobs do, will most likely pay even more in metro areas. Those looking to excel in the tech industry should look to big cities, according to the report, both for more opportunity and money.
For more, check out the 10 highest-paying tech jobs for new grads on TechRepublic.
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