Published May 23, 2023 by Hailea Schultz
Houston has emerged as the ultimate destination for new graduates, offering a compelling combination of low living costs, consistent growth, and a robust economy, according to a new analysis.
Gusto, a payroll software company, discovered that Houston's new graduates enjoy the highest adjusted salaries among nine major cities across the country, with an average of $65,648 once cost-of-living adjustments are factored in. New York places at the bottom of the list, despite having a high starting salary of $72,000. With a cost of living that surpasses the national average by 127%, New York graduates face an average adjusted salary of $31,000.
Houston’s living costs are 8% below the national average and 34.1% below the average among the most populous U.S. metro areas, according to the C2ER Cost of Living Index 2022 Annual Average.
“Houston is one of those areas where there’s both a lot of growth, there’s really solid pay, and – when you combine that with the low cost of living – turns out to be the city where new graduates can get the biggest value for their paychecks coming right out of college,” Luke Pardue, Gusto economist who conducted the research, told by the Houston Chronicle.
Additionally, the analysis ranked Houston as the second highest metro with the top hiring of college graduates.
The greater Houston region is home to more than 20 universities and colleges, which graduate more than 56,000 students annually. These education systems work tirelessly to bolster the city’s talent pipeline, with the support of its business community. The region has a multitude of robust programs that help students gain the critical skills needed in key industries of the region. With the efforts of the Houston community and endless young talent, 33% of Houston's population 25 years and older is a college graduate.
With a slowing economy, the overall new grad hiring rate is expected to fall by 25% nationwide compared to last year, according to Gusto's analysis.
Houston has experienced some job layoffs but remains resilient, as stated by the Partnership’s Chief Economist Patrick Jankowski in his latest podcast episode of Bayou Business Download. The latest data from the Texas Workforce Commission shows the unemployment rate for metro Houston improved in April to 4% from 4.4% in March. Since the beginning of the year, Houston has created over 34,000 jobs. There is no cause for alarm despite a slight uptick in initial claims filed for unemployment benefits in the metro area due to Houston’s ever-growing key industries, strong economy and talented workforce.
Learn more about living and working in Houston.