10 US Cities That Are Running Out of Jobs and Cheap Housing

While overall unemployment in the U.S. is still a relatively low 3.8%, as of August, it did rise from 3.5% in July. Higher interest rates and the burdens of inflation are having an impact, albeit small, on some parts of the country, driving up the costs of housing and pushing unemployment numbers up. In order to identify cities in the U.S. that are running out of jobs and cheap housing, GOBankingRates gathered information on the top 200 biggest housing markets in the U.S., according to Zillow.

GOBankingRates gathered data on July typical home value, July 2023 typical monthly rent, metro statistical area unemployment rate, as well as labor force participation rate and median household income. The labor force participation rate refers to the rate of the working-age population (over age 16) that is either working or actively looking for work, according to the Bureau of Labor Statistics. This measure gives a good representation of the labor resources available for producing goods and services.

The study found that nine of the top 10 cities starting to feel the pinch are in the usually thriving state of California, and only one in the state of New York. 

• July 2023 unemployment rate: 3.7%
• July rent: $3,485
• Labor force participation rate: 68.6%
• Median income: $147,176

• July 2023 unemployment rate: 5.0%
• July rent: $2,819
• Labor force participation rate: 65.5%
• Median income: $76,170

• July 2023 unemployment rate: 5.0%
• July rent: $2,759
• Labor force participation rate: 65%
• Median income: $87,478

• July 2023 unemployment rate: 5.0%
• July rent: $2,906
• Labor force participation rate: 67%
• Median income: $119,672

• July 2023 unemployment rate: 6.1%
• July rent: $2,131
• Labor force participation rate: 60.8%
• Median income: $69,824

• July 2023 unemployment rate: 4.6%
• July rent: $3,693
• Labor force participation rate: 62.5
• Median income: $80,220

• July 2023 unemployment rate: 5.0%
• July rent: $2,925
• Labor force participation rate: 66%
• Median income: $79,950

• July 2023 unemployment rate: 5.0%
• July rent: $2,951
• Labor force participation rate: 62.3%
• Median income: $86,222

• July 2023 unemployment rate: 5.0%
• July rent: $3,162
• Labor force participation rate: 66.1%
• Median income: $123,667

• July 2023 unemployment rate: ​​5.0%
• July rent: $3,339
• Labor force participation rate: 67.7%
• Median income: $140,546

Methodology: In order to identify cities in the U.S. that are running out of jobs and cheap housing, GOBankingRates gathered information on the top 200 biggest housing markets in the U.S., according to Zillow. To be considered for ranking, each city had to have data available on: (1) its July 2023 typical home value, according to Zillow, (2) its July 2023 typical monthly rent, according to Zillow and (3) its Metro Statistical Area unemployment rate, according to the July 2023 Bureau of Labor Statistics data. The 39 cities in the final ranking have values higher than the U.S. national average in all 3 of the above factors. The highlighted cities were then scored on all three factors and ranked against each other, with factors (1) and (2) carrying half as much weight as factor (3). Supplemental information was also provided on the final thirty nine cities including: labor force participation rate (for the population 16+) and median household income from the 2021 American Community Survey. All data was collected on and up to date as of September 6, 2023.