Special Report

Best American Cities for Business

10. Phoenix, Ariz.
> GDP: $181.59 billion
> Unemployment: 10.4%
> Median Income: $50,393

From its prerecession peak, Phoenix lost nearly a quarter million jobs, or 12.5% of its job market, the fifth-biggest decline among the largest 100 metropolitan areas in the U.S. Through the end of this year, according to IHS Global Insight, the city will recover less than 30% of those jobs. Between 2005 and 2010, regional GDP contracted by 6.2%, among the largest declines in the country. According to the KPMG study, the city ranks 10th among the 27 largest U.S. metropolitan areas for competitiveness. The Phoenix region is fourth-best in the U.S. for electronics manufacturing and third-best for both clinical trials and product testing for biotechnology.

9. Pittsburgh, Pa.
> GDP: $116.42 billion
> Unemployment: 7.6%
> Median Income: $46,709

Employment in Pittsburgh fell just 3.3% during the recession, one of the smallest declines in the country. The city’s labor market has since fully recovered, and the city is one of the few regions to have more employed citizens than it did at its prerecession peak. Pittsburgh is one of the few cities to have median income actually grow during the recession. Between 2009 and 2010, exports grew 13.2% in the area. According to the KPMG study, the city continues to provide opportunities for new business. It has among the 10 lowest costs in 16 of the 19 business categories, largely because of its low income, property and sales taxes.

8. Cleveland, Ohio
> GDP: $98.02 billion
> Unemployment: 8.1%
> Median Income: $46,240

Over the past few decades, the metropolitan area has been in a state of decline, losing a major share of its businesses and jobs. Between 2009 and 2010, the region added 1,120 export production jobs. Over this period, exports increased 11.9%, with growth in manufacturing contributing to 88.7% of the export growth. Exports contributed to 77% of the region’s GDP growth, as well. The city’s strong chemical industry has been the biggest part of this growth. According to the report, Cleveland’s most competitive industries are agri-foods and precision manufacturing. In these sectors in particular, the region distinguishes itself by having low transportation costs and low taxes.

7. St. Louis, Mo,
> GDP: $125.22 billion
> Unemployment: 8.4%
> Median Income: $50,913

St. Louis’s competitiveness, according to the KPMG report, arises from its low factory lease costs and cheap electricity. Tax Foundation Ranked St. Louis 14th best among 51 cities for taxes conducive to new businesses. According to KPMG, the city has burgeoning aerospace, biotech and telecom industries. In addition, the metropolitan region is among the five cheapest for green energy, auto manufacturing and agri-foods business, with the lowest electricity costs in each of these sectors across all 27 U.S. metropolitan regions.

6. Baltimore, Md.
> GDP: $144.61 billion
> Unemployment: 7.3%
> Median Income: $64,813

Between 2007 and 2010, median income increased 1.7% in the Baltimore metropolitan statistical area to $64,800 per person, making it the ninth-wealthiest major city in the U.S. The KPMG study ranked the region sixth overall, with some of the biggest factors being low property taxes and low office leasing costs. Baltimore’s cost index is benefiting from the lowest suburban office lease costs among large cities and low property-based taxes. According to the Tax Foundation, Baltimore ranked 14th out of 51 cities for low taxes on mature corporate headquarters. The city scored in the top five in the country for product testing, due primarily to having the lowest office lease costs among the 27 U.S. regions in this sector.

Sponsored: Find a Qualified Financial Advisor

Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.