What Do We Know about Mega Metros?

Not only does BLS produce nationwide economic indicators, but we also have a treasure trove of data for metropolitan areas across the country.

According to the U.S. Census Bureau, 62.9 percent of our country’s 325.7 million people live in incorporated places. To celebrate our metro areas, we looked at the data for our six largest ones. We started with five but expanded to six, and you’ll soon see why.

Just a little history

You can track our march west as a nation, and, later, to the Sun Belt, in this list of the six most populous U.S. cities:

1. New York City: Since the first census in 1790, New York has been our most populous city. Its population of 8.6 million makes it more than twice as large as the next largest city, Los Angeles.
2. Los Angeles City: With a population of about 4 million, Los Angeles first showed up on the top-five list with the 1930 Census.
3. Chicago City: Even with little population growth over the last several years, Chicago remains the third-largest city, with a population of 2.7 million. Chicago first showed up on the top-five city list in 1870.
4. Houston City: And now we get to the Sun Belt, which seems to expand every year. Houston, with a population of 2.3 million, was a top-five city starting in 1980.
5. Phoenix City: In 2016, Phoenix beat out Philadelphia for the number five spot on the most populous city list. In July 2017, its population was 1.6 million.
6. Philadelphia City: Since Philadelphia was the second most populous city in 1790 and remained within the top five until Phoenix nudged it out in 2016, we kept it on our list. Philadelphia’s population is almost 1.6 million.

What makes a metro area great?

That’s easy—its people! So what’s happening with the people in each metro area? Are they working? Where do they work? What type of work? What are their earnings? How do they spend their money?

For the rest of this blog, we will use the Office of Management and Budget’s Metropolitan Statistical Areas to define our mega metros:

• New York-Newark-Jersey City, NY-NJ-PA Metropolitan Statistical Area
• Los Angeles-Long Beach-Anaheim, CA Metropolitan Statistical Area
• Chicago- Naperville-Elgin, IL-IN-WI Metropolitan Statistical Area
• Houston-The Woodlands-Sugar Land, TX Metropolitan Statistical Area
• Phoenix-Mesa-Scottsdale, AZ Metropolitan Statistical Area
• Philadelphia-Camden-Wilmington, PA-NJ-DE-MD Metropolitan Statistical Area

We won’t use these long titles, but we will compare the areas listed above.

What’s the unemployment rate?

In November 2018, the national unemployment rate was 3.5 percent. Los Angeles had the highest rate (4.2 percent) among these six areas. Phoenix (3.9 percent), Houston (3.8 percent), Chicago (3.8 percent), Philadelphia (3.6 percent) and New York (3.3 percent) round out our list. New York had the largest over-the-year decrease in their unemployment rate among these six areas from November 2017 to November 2018 (-0.9 percentage point). Los Angeles was the only one of the six metro areas that had an over-the-year increase (+0.2 percentage point) in the unemployment rate.

How about the number of jobs? Has that been going up?

As we walk around our metro areas, we will see more folks going to work than a year ago. Nonfarm payroll employment increased for all of these areas from November 2017 to November 2018. Two showed growth rates above the national average—4.2 percent in Phoenix and 3.7 percent in Houston. The other four areas showed growth rates of 1.5 percent or lower. The national growth rate was 1.6 percent.

Where are people employed? What industries?

What industries employ the most workers? Trade, transportation, and utilities is the biggest industry, with 28.5 million workers nationwide. Education and health services (24.1 million workers) comes in second.

As we walk around each of these metro areas, what industries will we see employing our workers? Basically the same as the nation! In four of the six areas (all but New York and Philadelphia), trade, transportation, and utilities is the biggest industry. For both New York and Philadelphia, the biggest industry is education and health services.

What kind of occupations do people have?

What occupations do these folks have? This might sound like what we just covered, but occupation and industry are different. For example, I’m an economist (occupation) who works in government (public administration industry), but I could be an economist who works in a bank (financial activities industry).

I must admit I was surprised that, for all of our metro areas and the nation, these are the three largest occupational groups for our workers: office and administrative support occupations, sales and related occupations, and food preparation and serving related occupations. So as you walk around these metro areas, you will see people hurrying to work on a computer, sell an item, or cook a meal!

What about earnings? Do they vary much by metro area?

Nationwide, average hourly earnings in November 2018 for all employees were $27.28. Phoenix had the lowest average hourly earnings among these six areas, at $27.22. The highest average hourly earnings were in New York, $32.83. That’s a difference of $5.61 per hour between the highest and lowest averages among these six metro areas.

Where do folks spend their money?

Because of small sample sizes for metro areas, we’ll use an average of 2016–17 data on consumer spending for metro areas and the United States. Consumers in the three largest areas—New York, Los Angeles, and Chicago—all allocate a larger share of their total spending to housing than the national average. The U.S. housing average is 33 percent, while New Yorkers spend about 39 percent on housing. The percentage of households that own their homes also varies in our areas: Philadelphia has the highest homeownership percentage (70 percent), while New York has the lowest (49 percent). But New York residents spend less on transportation, 12 percent, compared to Houston residents, who spend 18 percent.

Want more metro area data?

You might not know about our Economic Summaries, which gather data from many programs. We have information for hundreds of metro areas in all 50 states, plus a couple of territories. We also have geographic definitions for each subject. We update the summaries each month to keep them fresh.

You can use these Economic Summaries to see how your area is doing. If you have questions about this information, feel free to contact one of our BLS Regional Information Offices. We provide these gold-standard data to help you make smart decisions, such as, do you want to stay in your metro area? Or does another catch your eye?!

*A note to our readers that the above data are not seasonally adjusted and some may be subject to revision. Area definitions may differ by subject. For more area summaries and geographic definitions, please see our Economic Summaries.