Job Churning

A score based on the number of new start-ups and business failures within each metro.

Why Is This Important? Steady growth in employment masks the constant churning of job creation and destruction, as less innovative and efficient companies downsize or go out of business and more innovative and efficient companies grow and take their place. For example, a total of 3.5 million private sector jobs were added to the U.S. economy between 1994 and 1995, but that was after new firms had created 5.7 million jobs, failing firms eliminated 4.5 million jobs, expanding firms added 10.5 million jobs, and contracting firms eliminated 8.2 million others. This churning has accelerated over the last three decades as the number of new start-ups and existing business failures per year has grown. While such turbulence increases the economic risk faced by workers, companies, and even regions, it is also a major driver of economic innovation and growth.

The Rankings: Some fast-growing metropolitan areas (like Denver, Atlanta, Las Vegas, and Phoenix) have seen a great deal of churning. In part, this is because fast-growing economies produce more start-ups, especially in locally focused industries (such as restaurants, dry cleaners, or accountants). But a high churn rate also reflects a dynamism that leads to the death of old, outmoded firms and the creation of innovative new companies that sell outside the metro. Many metropolitan areas rooted in the traditional manufacturing sector, such as Rochester, Cincinnati, Detroit, and Pittsburgh, have low levels of both new growth and loss, suggesting economies that are stable, without the kind of "creative destruction" that leads to faster restructuring for the New Economy.

100th-76th Percentile

75th-51st Percentile

50th-26th Percentile

25th-1st Percentile

METRO AREAS BY RANK
Rank	Metro Area	Score
1	Denver	11.7
2	Atlanta	11.2
3	Dallas	11.2
4	Las Vegas	11.1
5	Phoenix	11.0
6	San Diego	10.9
7	Salt Lake City	10.9
8	Houston	10.9
9	Nashville	10.8
10	Miami	10.7
11	Los Angeles	10.7
12	Minneapolis	10.6
13	Austin	10.5
14	Greensboro	10.5
15	Washington	10.3
16	Charlotte	10.2
17	Chicago	10.1
18	Louisville	10.1
19	San Francisco	10.1
20	St. Louis	10.1
21	Jacksonville	10.1
22	Raleigh-Durham	10.1
23	New Orleans	10.1
24	Indianapolis	10.0
25	Dayton	10.0
26	San Antonio	10.0
27	Orlando	10.0
28	Portland	9.9
29	Tampa	9.8
30	Richmond	9.8
31	Kansas City	9.8
32	Boston	9.7
33	Buffalo	9.6
34	Milwaukee	9.6
35	Philadelphia	9.6
36	Columbus	9.6
37	Grand Rapids	9.5
38	West Palm Beach	9.5
39	Seattle	9.4
40	Norfolk	9.4
41	New York	9.4
42	Oklahoma City	9.4
43	Sacramento	9.4
44	Cleveland	9.3
45	Memphis	9.2
46	Pittsburgh	9.2
47	Hartford	9.1
48	Detroit	9.1
49	Cincinnati	8.9
50	Rochester	8.3
	U.S. Average	NA
	Top 50 Metro Average	9.5

ALPHABETICALLY
Metro Area	Rank	Score
Atlanta	2	11.2
Austin	13	10.5
Boston	32	9.7
Buffalo	33	9.6
Charlotte	16	10.2
Chicago	17	10.1
Cincinnati	49	8.9
Cleveland	44	9.3
Columbus	36	9.6
Dallas	3	11.2
Dayton	25	10.0
Denver	1	11.7
Detroit	48	9.1
Grand Rapids	37	9.5
Greensboro	14	10.5
Hartford	47	9.1
Houston	8	10.9
Indianapolis	24	10.0
Jacksonville	21	10.1
Kansas City	31	9.8
Las Vegas	4	11.1
Los Angeles	11	10.7
Louisville	18	10.1
Memphis	45	9.2
Miami	10	10.7
Milwaukee	34	9.6
Minneapolis	12	10.6
Nashville	9	10.8
New Orleans	23	10.1
New York	41	9.4
Norfolk	40	9.4
Oklahoma City	42	9.4
Orlando	27	10.0
Philadelphia	35	9.6
Phoenix	5	11.0
Pittsburgh	46	9.2
Portland	28	9.9
Raleigh-Durham	22	10.1
Richmond	30	9.8
Rochester	50	8.3
Sacramento	43	9.4
Salt Lake City	7	10.9
San Antonio	26	10.0
San Diego	6	10.9
San Francisco	19	10.1
Seattle	39	9.4
St. Louis	20	10.1
Tampa	29	9.8
Washington	15	10.3
West Palm Beach	38	9.5

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The Progressive Policy Institute (PPI)
Technology, Innovation, and New Economy Project
600 Pennsylvania Ave., S.E., Suite 400, Washington DC 20003
Phone: (202) 547-0001
www.ppionline.org

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