Denver climbed seven spots in an annual ranking of the country’s best-performing cities, according to a report released Wednesday.
Citing Denver’s wage growth, strong tech industry and highly educated workforce, the Milken Institute ranked the city as the 11th best-performing large city in its 2021 annual ranking.
The Santa Monica-based nonprofit, which historically bases rankings on cities’ job and wage growth and strength in high-tech sectors, added broadband access and housing affordability for this year’s ranking in an effort to highlight how much infrastructure improvements and other metrics reflect the inclusiveness of local economies.
A total of 92.5% of Denver households have access to broadband, the 11th-highest among large cities, according to the nonpartisan think tank, giving the city a boost in the ranking. But Denver’s housing affordability ranks 141 out of the 200 metro areas with populations greater than 250,000 the institute ranked, dragging down the city’s rank. Helping the city's ranking this year was its stellar wage growth – personal income, which includes many different forms of compensation, like salaries and returns on investments, grew 4% in the Denver-Aurora-Lakewood area between 2018 and 2019, the second-highest out of any metro area with more than 2 million residents, according to figures from the Bureau of Economic Analysis.
“Traditionally, Denver had a cost advantage over the coastal tech clusters, but the increasing cost of living – especially housing – may be eroding this advantage,” the Milken Institute report said in its profile of the city.
City planners and the city’s Department of Housing Stability are working to incentivize the construction of more affordable and mixed-use housing, particularly near public transportation. The city’s committee has been studying how other municipalities tackle housing affordability.
Denver ended 2020 with a median closing price for a detached, single-family home of $507,000.
In 2020, the city of Denver saw vast drops across multiple revenue streams, like sales and use tax. Though 2021 will likely see a bump in tax revenue, which can fund initiatives like affordable housing programs, total returns likely won’t be near pre-pandemic levels.
Another large Front Range city, Fort Collins, saw a big boost in this year’s ranking, climbing nine ranks to number 12. The city, which also boasts high access to broadband and is the home of Colorado State University, climbed nine spots in the ranking compared to last year’s report. The region’s strong tech sector factored into Fort Collins’ ranking, but like Denver, it also lost points for its relatively high housing costs.
Among smaller cities the institute tracked, Boulder ranked 44th, a drop of 16 places from 2020. Like Denver, Boulder scored well for high-tech concentration and broadband access, but lagged in terms of housing affordability, job growth and wage increase. Colorado Springs ranked 17th, a jump of 19 spots. The Milken Institute cited the city’s solid wage growth and broadband access.
Many other top performers in this year’s ranking were cities in the Mountain West, like Salt Lake City and Boise. The report noted that compared to previous years, the center of tech industry in the country has shifted from areas like Massachusetts and California to the Mountain West. A number of tech companies have relocated their headquarters to the Denver area in recent months, including Palantir.
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