While there is a lot of debate on whether the U.S. will enter a recession – or if it's already in one – some models have projected a likelihood as high as 99.3%1. While no one can predict the future, we can look at the past and present to understand which places are most poised to withstand the economic repercussions of a recession.
To do this, SmartAsset analyzed data for 529 cities to find the best places to ride out a recession. We considered nine different metrics across four overarching categories: employment, housing, social assistance and economic stability.
- Western cities dominate. Eight of the top 10 cities were in Colorado, California, Utah and Washington. Castle Rock and Highlands Ranch, Colorado, took the number one and two spots.
- California is a double-edged sword. Cities like Sunnyvale, Santa Clara, Mountain View, Milpitas and Palo Alto ranked among the fastest growing economies with 7.5% annual growth. But other parts of California are home to the highest unemployment rates, with more than 11% of residents without work in areas like Visalia, Tulare and Merced.
- Florida cities would likely fare poorly in a recession. Despite Floridian cities being popular for retirees, they don't crack the top 50 best places to ride out a recession. Residents in Fort Lauderdale (158th), West Palm Beach (214th), Miami Beach (339th), Fort Myers (343rd) and Daytona Beach (350th) tend to be more house poor and have lower rates of health insurance coverage than other cities.
- Nearly one in three Americans in these places are already living below the poverty level. San Marcos, TX and Jackson, MS fare poorly for residents being able to afford necessities. Meanwhile, the cost of living for a single adult in these areas is estimated to be more than double the poverty income limit. Highlands Ranch, CO and Lakeville, MN had the lowest percentage of residents in poverty at 1.4% and 1.7%, respectively.
- Castle Rock, CO
Castle Rock takes the No. 1 spot as the best city to ride out a recession. Located roughly 45 minutes away by car from the state's capital, Castle Rock ranked highest in the social assistance category (third-best), and is top 10 in both the housing and employment categories, as well. Less than 1% of households rely on social assistance and nearly 96% of residents have health insurance coverage.
- Highlands Ranch, CO
Highlands Ranch is just 30 minutes north by car from the No. 1 ranking city. This suburb of Denver has the lowest percentage of residents living below the poverty line (1.4%) and the 24th-lowest percentage of households relying on social assistance (1.27%). Additionally, roughly 4% of residents do not have health insurance coverage.
- Overland Park, KS
Overland Park scores well in the housing, social assistance and economic stability categories. Specifically, the city ranks 32nd with a high labor force participation rate (72.6%) and a low percentage of residents below the poverty level (5.8%). Less than 2% of households rely on social assistance.
- Kirkland, WA
This Seattle suburb ranked second highest in the economic stability category. Roughly 7% of the population live below the poverty line and the county in which Kirkland, Washington is located has the 16th-highest three-year GDP growth rate (5.80%). At a state level, just 7.6% of Washington residents reported food insufficiency, which refers to households where there was not always enough to eat.
- San Mateo, CA
In San Mateo, 6% of residents live below the poverty level and roughly 2% of households rely on social assistance. With a low mortgage delinquency rate (0.23) and a high three-year GDP growth (5.60%) in the county where San Mateo is located, this city scores well in the economic stability category and takes the No. 5 spot overall.
- Mountain View, CA
Mountain View, California has the highest percentage of residents with health insurance in the top 10 cities – 98% are covered. Additionally, this Silicon Valley city has a labor force participation rate of 72.1%. Mountain View is located in Santa Clara county, which ranks No. 1 study-wide for its high three-year GDP growth (7.52%) and No. 2 for its low mortgage delinquency rate (0.23).
- Sandy, UT
Roughly 5.5% of the population in Sandy, Utah are living below the poverty line (28th-lowest). The county in which Sandy is located (Salt Lake County) has a low unemployment rate of 2.5%. When it comes to social assistance, just 1.7% of Sandy households are receiving public assistance. Sandy is the seventh-largest city in Utah – a state where less than 8% of residents report either food insufficiency or housing insecurity.
- Olathe, KS
Roughly 1.52% of households rely on social assistance in Olathe, Kansas, which ranks 38th-lowest out of 429 cities for this metric. Nearly 72% of the population is in the labor force and Johnson county (in which Olathe is located) has both a low unemployment rate (2.70%) and a low mortgage delinquency rate (0.55).
- Bellevue, WA
Bellevue is about 15 minutes away from the No. 4 ranking Kirkland and scores well in both the economic stability and housing categories. Less than 8% of residents are below the poverty level, which ranks in the top fifth studywide, and just over 65% are in the labor force. King County, where Bellevue is located, also has the 14th-lowest mortgage delinquency rate (0.29) and the 16th-highest three-year GDP growth rate (5.80%).
- Layton, UT
With Utah's single largest employer located within its boundaries, Layton, Utah rounds out the top 10. Nearly 73% of the Layton population is in the labor force and less than 8% of the population lives in poverty. Layton also has the second-lowest percentage of households that rely on social assistance study-wide (0.57%) and roughly 90% of the population has health insurance coverage.
- Camden, NJ
- Augusta, GA
- Pasadena, TX
- Reading, PA
- Rockford, IL
- Brownsville, TX
- Hammond, IN
- Mission, TX
- Gulfport, MS
- Cicero, IL
To find the best cities to ride out a recession, we analyzed 529 places including cities, towns and census-designated places. We then compared them across four categories and a total of nine individual metrics:
- Employment. For the employment category, we considered the March 2023 unemployment rate and labor force participation rate (LFPR). Unemployment data comes from the Bureau of Labor Statistics (BLS)'s Local Area Unemployment Statistics (LAUS) and is at the county-level. LFPR data comes from the Census Bureau's 2021 1-year American Community Survey.
- Housing. For the housing category, we looked at the recent housing insecurity and the mortgage delinquency rate for households 30 to 89 days delinquent. Data comes from the Census Bureau's Household Pulse Survey and the Consumer Financial Protection Bureau (CFPB).
- Social assistance. For the social assistance category, we looked at the percentage of the population relying on public assistance and the percentage of residents with health insurance coverage. Data comes from the Census Bureau's 2021 1-year American Community Survey.
- Economic stability. For the economic stability category, we examined recent food insufficiency, the annualized three-year GDP growth rate and the percentage of residents below the poverty level. Data comes from the Census Bureau's Household Pulse Survey, Bureau of Economic Analysis and the Census Bureau's 2021 1-year American Community Survey.
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