America's Best Cities For Young Professionals

These metros offer the best chances for college graduates in a tough economy.

University valedictorians, overachievers and would-be entrepreneurs across the country graduated this month into a bleak economic landscape. Faced with 9.5% national unemployment, even the most ambitious young people are thinking carefully about how to find their best shot at success.Our advice? Consider moving to Houston, Texas, Washington, D.C., or Minneapolis, Minn. These three cities top Forbes' fourth-annual list of best cities for young professionals--places where ambitious college grads can get a strong start on a high-powered career.

These metros boast affordability, good job prospects and larger-than-average incomes. And they're already home to some of the country's biggest companies and alumni from the prestigious schools--a recipe that offers well-educated graduates a best shot at upward mobility.

The Lone Star Shines

There are good prospects for ambitious young professionals across the country, but Texas dominates our list, boasting three of the top 10 spots. Because of its business-friendly environment and abundance of oil money, 14 of the country's largest companies (as measured by market capitalization) are based in our No. 1 city, Houston. Only New York, N.Y., which ranks No. 4 on our list, boasts more big employers. Houston also shines thanks to high average incomes and a concentration of grads from elite colleges--and not just from local Rice University, but from across the country.

No. 6 city Dallas, where the technology and energy sectors boost the local economy, promises a healthy $63,000 median salary for college graduates. Austin, Texas, the seat of state government and a major recipient of government spending, makes the list at number 10. The city's 7% unemployment rate is well below the national average. Texans in these cities have reason to feel more confident about their prospects than in metros that were harder hit by the housing crisis.

"In Austin and Dallas job security concerns are probably less than in other places," says James P. Gaines, research economist at the Real Estate Center at Texas A&M University. "That's mainly because of the belief that the economy in Texas is not as subject to major implosion that maybe some other areas are susceptible to."

Regional Champs

On the East Coast opportunities await in our nation's capital. Thanks to its huge government presence, second-ranked city Washington D.C. is flush with jobs, and boasts the lowest unemployment rate of the cities we ranked, at just 5.9%. D.C.'s high cost of living is largely offset by generous paychecks--the city boasts the third-best average income for college graduates.

In the Northeast big cities benefit from access to so many great colleges and high-paying jobs. But high barriers to entry make it tougher for those young people to succeed: Fourth-ranked New York City and fifth-ranked Boston, Mass., were hurt in the rankings by their high costs of living.

The Twin Cities offer best career prospects in the Midwest. Our third best-ranked metro for young professionals, Minneapolis-St. Paul has a low unemployment rate, a cost of living just below the national average, and a robust business environment. Local employers include heavyweights like Travelers Co., US Bancorp ( USB - News ) and Medtronic ( MDT - News ).

Economically diverse Atlanta, Ga., is a hungry young professional's best bet in the South, where beverage giant Coca Cola Co. ( KO - News ) buoys local jobs. "Hotlanta" came in at No. 9 on our list.

 
1. Houston, Texas
(Metropolitan Statistical Area: Houston-Sugar Land-Baytown, Texas)

Catherine Yeulet/Istock

Cost of Living rank: 27

Large Companies rank: 2

Elite Graduates rank: 6

Average Income rank: 7

Unemployment rank: 18

 

 
2. Washington, D.C.
(Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.Va.)

Istock

Cost of Living rank: 43

Large Companies rank: 12

Elite Graduates rank: 2

Average Income rank: 3

Unemployment rank: 1

 

 
3. Minneapolis, Minn. / St. Paul, Wis.
(Minneapolis-St. Paul-Bloomington, Mn.-Wi.)

Istock

Cost of Living rank: 17

Large Companies rank: 6

Elite Graduates rank: 20

Average Income rank: 20

Unemployment rank: 3

 

 
4. New York, N.Y.
(New York-Northern New Jersey-Long Island, NY-NJ-Pa.)

Istock

Cost of Living rank:46

Large Companies rank: 1

Elite Graduates rank: 1

Average Income rank: 4

Unemployment rank: 22


 

 
5. Boston
(Boston-Cambridge-Quincy, Ma.-N.H.)

Istock

Cost of Living rank: 41

Large Companies rank: 7

Elite Graduates rank: 3

Average Income rank: 8

Unemployment rank:15