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Where the Educated Millennials Congregate

Justin Fox
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Where the Educated Millennials Congregate

(Bloomberg Opinion) -- Longtime San Francisco residents complain that their city has been overrun by young, well-educated software engineers, data scientists and the like who drive up housing prices, ride around on electric scooters and just generally ruin everything.

Census Bureau data offer some support for this complaint, at least the part about there being lots of well-educated young folks in town. One in 5 San Francisco residents in 2017 was a college graduate aged 25 to 34. That’s really high! Among the 100 largest(1) American cities and city-like entities (Arlington, Virginia, across the Potomac River from Washington, is technically a county, but Virginia does things a little different from other states), though, it’s not quite the highest:

Nationwide, 25-to-34-year-old college graduates make up 6.4% of the population. In the 100 biggest cities, their (unweighted) average share is 9.3%. So the above chart is a useful if not exactly definitive snapshot of where the young and educated have congregated. It does miss the borough of Manhattan, which if counted by itself would come in fifth place, at 19.5% (for New York City as a whole, the percentage is 11.5%).(2) It’s also misleadingly exact: These numbers are derived from the Census Bureau’s annual American Community Survey, which comes with margins of error that grow as the cities get smaller.

The rolling five-year ACS estimates allow one to dig a bit deeper into the ranks of cities (the chart below includes those with populations of around 40,000 and up)(6), with interesting results:

These lists are fun, right? They combine familiar millennial-magnets(5) such as San Francisco, Seattle, Austin, Portland and Somerville-Cambridge with some that are perhaps still a bit under the radar. I mean, I knew lots of young professionals lived in Hoboken and Jersey City, both just across the Hudson River from lower Manhattan, but I had no idea the extent to which young college graduates had taken over in the two cities. In California, Fremont, Mountain View and Irvine don’t exactly top any lists of cool places for millennials to congregate, but they are cities with lots of apartment buildings in regions (Silicon Valley and Orange County) with lots of good jobs. In North Carolina, Durham has pulled ahead of its bigger Research Triangle rival Raleigh. And hey, props to Atlanta, Minneapolis, Pittsburgh and Richmond!

Among the larger cities, Pittsburgh and Jersey City also stand out for how much their population mix has shifted in the young-and-educated direction in recent years. Pittsburgh’s share of 25-to-34-year-olds with college degrees has almost doubled since the first American Community Survey was conducted in 2005.

I should note that among the Northeastern and Midwestern cities on this list, only Boston is actually experiencing significant (10.9% since 2010) overall population growth, so it’s not so much that young college graduates are flocking to those places in massive numbers as that this group is growing somewhat while the rest of the population holds steady or shrinks. Still, it’s a good group to have around: Concentrations of young, skilled workers help struggling cities pay their bills now (by generating tax revenue while not placing big demands on city services) and can be a harbinger of economic growth to come. They’re also a harbinger of lots of other things, as San Franciscans can attest. Being a magnet for the young and educated is not an uncomplicated blessing, but it’s better than not being a magnet for them.

Detroit makes for an interesting illustration of this. The revival of the city’s downtown has brought hope but also concerns that its affluent young residents will displace poorer long-timers and skew the city’s priorities. As of 2017, though, college graduates aged 25 to 34 still made up only an estimated 3.5% of Detroit’s population. That’s up 1.3 percentage points from 2005, but it still puts Detroit in third-to-last place (behind Hialeah, Florida, and North Las Vegas, Nevada) in the city rankings. Meanwhile, the Detroit-Warren-Dearborn metropolitan area isn’t far off the national average, with 6% of its population consisting of college graduates aged 25 to 34. In contrast to the situation in San Francisco and Seattle, the area’s suburbs (such as Royal Oak, with a 21% young-graduate share) remain a bigger draw for young college graduates than the city. In other words, it seems like Detroit has a long ways to go before its ranks of young college grads can be considered either a major economic force or a problem.

Overall, the metropolitan-area leader board has fewer surprises than the city lists do. It’s filled with the usual-suspect big metros (Silicon Valley, San Francisco, Boston, Washington), not-all-that-big college towns (which may get a boost from the 25-to-34-year-olds still in graduate school) and … Fargo.

North Dakota’s biggest city has been an under-the-radar boomtown for a while now. It’s home to North Dakota State University, but it isn’t exactly a college town.(3) It’s in a state that’s been experiencing an oil boom but is hundreds of miles from the oilfields. It’s got Microsoft Business Solutions (formerly Great Plains Software) and a bunch of other white-collar employers, and it’s pretty affordable. I also haven’t heard of anybody there complaining about how young, well-educated people are ruining the place. Have you?

(Corrects Pittsburgh’s share of 25-to-34-year-olds with college degrees in sixth paragraph of article published May 22.)

(1) I identified the top 100 using the population totals from the American Community Survey, which don't quite match the numbers produced by the Census Bureau's population estimates program but seemed close enough for this purpose.

(2) The other boroughs' percentages are Brooklyn, 12.6%; Queens, 9%; Staten Island, 7.3%; and the Bronx, 5%.

(3) I actually used the margin of error as my cutoff, excluding cities and census-defined places with an overall population estimate error of more than 1% (the error margins for the individual educational categories were all higher than that). Among those that would have made the list but for missing the cutoff were Consohocken, Pennsylvania; Richmond Heights, Missouri; Falcon Heights, Minnesota; and Watertown, Massachusetts.

(4) The 25-34 age cohort and the millennial generation aren't a perfect match, but they're in the same ballpark, with the millennials (as delineated by Pew Research Center) currently ranging from 22 to 38.

(5) That is, NDSU has 13,796 students, while Fargo's metro-area population is 245,471. By contrast, Iowa State University has 34,992 students in a metropolitan area (Ames) of just 98,105.

To contact the author of this story: Justin Fox at justinfox@bloomberg.net

To contact the editor responsible for this story: Brooke Sample at bsample1@bloomberg.net

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Justin Fox is a Bloomberg Opinion columnist covering business. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of “The Myth of the Rational Market.”

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