The 10 Best Cities for Educated Workers

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Brigham Young UniversityThe job market has remained relatively stagnant since 2009. To make matters worse, the educational requirements of the average U.S. employer have increased consistently from 2005 to 2009, recently outpacing the growth of educated labor, a new report shows. This means that the average job now requires a higher level of education than the average worker possesses -- a bad sign for much of America's labor force.

However, there are a number of metropolitan areas in the country that have exceptionally small education gaps, or "shortages of educated workers relative to employer demand," according to the report "Education, Demand, and Unemployment in Metropolitan America" by the Brookings Institution. These areas tend to have a large number of highly educated workers available to meet rising demand.

As a result, these cities often have lower unemployment rates than the national average, which was 9.1 percent as of July 2011. "Highly educated metropolitan areas like Salt Lake City, Raleigh, Indianapolis and Knoxville have avoided very high unemployment rates despite having high concentrations of jobs in industries that were hit hard during the recession," Jonathan Rothwell, one of the report's authors, told 24/7 Wall St. "The reason, in large part, is that the average worker in those areas has enough education to meet the needs of the average job." In cities such as Boston and Madison, which are major educational hubs, a cycle is formed. They produce lots of educated people and provide lots of jobs for educated people.

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The 10 Best Cities for Educated Workers
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The 10 Best Cities for Educated Workers

> Unemployment rate: 10.4%
> Change in unemployment from pre-recession low: +5.8%
> Median household income: $85,020


See homes for sale in San Jose, Calif.


Although San Jose has an exceptionally small education gap, it has an above-average unemployment rate. This is because the city’s manufacturing sector took a major hit during the recession. The city’s population is highly educated due in large part to the technology industry. Cisco Systems is headquartered in the city, which has been nicknamed the “Capital of Silicon Valley,” and other large tech companies, such as IBM, employ many people there.

> Unemployment rate: 7.5%
> Change in unemployment from pre-recession low: +3.7%
> Median household income: $65,101


See homes for sale in Minneapolis, Minn.


Minneapolis’s education gap is kept small by the University of Minnesota, which is located in the metropolitan area, and by a number of successful local companies that continue to hire. Six different Fortune 500 corporations are headquartered in the city, including Target, U.S. Bancorp and Ameriprise Financial. Unemployment increased 3.7% since the pre-recession low — a small amount relative to most of the country’s metropolitan areas.

> Unemployment rate: 7.1%
> Change in unemployment from pre-recession low: +3%
> Median household income: $69,907


See homes for sale in Boston, Mass.


The Boston metropolitan area is home to some of the top schools in the world, including Harvard, Tufts and the Massachusetts Institute of Technology. These schools support the area’s demand for a highly educated workforce. Boston has highly developed health care and education industries. Both fields have been among the most resilient during the recession, according to Brookings.

> Unemployment rate: 9.1%
> Change in unemployment from pre-recession low: +5%
> Median household income: $64,219


See homes for sale in Seattle, Wash.


Seattle is considered one of the most literate cities in the U.S. There are nearly 20 colleges and universities within the city limits. It is also home to several large companies, including Starbucks, Amazon.com and Microsoft, which is the second-biggest employer in the city. Boeing relocated its corporate headquarters to Chicago some years ago, but still remains Seattle’s biggest employer, which is why the city is often called “Jet City.”

> Unemployment rate: 10.1%
> Change in unemployment from pre-recession low: +5.8%
> Median household income: $74,876


See homes for sale in San Francisco, Calif.


San Francisco is a major biotechnology and biomedical center. The city’s technology industry, which is closely tied to neighboring San Jose, has drawn thousands of highly educated, skilled workers to the area in recent years, according to the San Francisco Chronicle. Despite this, the metropolitan area has an above-average unemployment rate. This is primarily the result of “the difficulty of being in California during the recession,” says Brookings’s Jonathan Rothwell. The state was badly hurt by the collapse of the housing bubble.

> Unemployment rate: 8.4%
> Change in unemployment from pre-recession low: +4.8%
> Median household income: $60,110


See homes for sale in Raleigh, N.C.


Raleigh, Chapel Hill and Durham make up what is commonly referred to as the “research triangle” or, simply, “the triangle.” The region is home to three major universities: UNC Chapel Hill, North Carolina State University and Duke. Raleigh’s biggest employers are either institutes of education, hospitals, or biotech research centers.

> Unemployment rate: 8.5%
> Change in unemployment from pre-recession low: +4.5%
> Median household income: $81,114


See homes for sale in Stamford, Conn.


The Bridgeport-Stamford-Norwalk metropolitan area is home to a number of large corporations, due in large part to the area’s proximity to Manhattan. The metropolitan area is known primarily as a financial hub. It is home to Bridgewater Associates, which is the world’s largest hedge fund, Aladdin Capital, and SAC Capital Advisors. Many of the area’s largest employers are also in the field of health care services.

> Unemployment rate: 8.0%
> Change in unemployment from pre-recession low: +5.5%
> Median household income: $56,510


See homes for sale in Provo, Utah


The Provo-Orem Metropolitan Statistical Area is home to Brigham Young University. The 30,000-student institution serves as the intellectual engine for the region, and many of those students end up at the large software and tech companies in the area. Symantec (NASDAQ: SYMC), Corel and Novell are headquartered here, as are several biotech companies. In general, the region has a very diverse economy, with jobs available across most major industries.

> Unemployment rate: 6.0%
> Change in unemployment from pre-recession low: +3%
> Median household income: $56,519


See homes for sale in Washington, D.C.


Washington D.C. has both resilient industries and an extremely low education gap. The metropolitan area is helped immensely by being the country’s capital. As of 2008, about one-third of the jobs in Washington D.C. were with the federal government, according to the Department of Employment Services. The metro area is also home to many educational institutions, such as Georgetown University and George Washington University.

> Unemployment rate: 5.5%
> Change in unemployment from pre-recession low: +1.7%
> Median household income: $58,775


See homes for sale in Madison, Wis.


Madison’s unemployment rate of 5.5% is the 20th lowest across all U.S. metropolitan statistical areas. The city is the home of the University of Wisconsin-Madison, which is the one of the largest employers in the region, second only to the state government. The university’s hospital is one of the biggest training hospitals in the country, and there are several other major hospitals in the region. Madison is also home to a variety of other businesses, including several insurance firms and a group of biotech companies. Nearly half of the city’s population holds a bachelor’s degree.

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There are still some cities with small education gaps that do not have exceptionally low unemployment rates. This is the result of unavoidable economic forces. San Francisco, for instance, was badly damaged when the housing bubble burst -- the same crash that has hurt so much of California. San Jose's unemployment rate remains high because its manufacturing base was hit especially hard during the recession.

24/7 Wall St. has analyzed the 10 metropolitan areas in the Brookings report with the smallest education gaps. We looked at what causes these areas to have highly educated residents and how their education levels are affecting the areas' unemployment rates. We then looked at numbers for median household income from the Census Bureau, all of which were higher than the national average of $51,425.

Click through the gallery to view the cities where people are most qualified to work.

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