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College Towns: Beating the Recession Odds with Low Unemployment Rates

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It normally seems as if the activities and events occurring on large university campuses are never-ending, but there are other benefits to living in a college town—benefits besides the school itself and the entertainment factor it provides for students and local residents.

The majority of American cities recently went through a few years of quick economic growth followed by a devastating landslide into recession that includes high unemployment rates, but current Census analysis is showing that college towns seem to have made it through the recession and subsequent housing market decline unscathed.

College Town, USA

A college town is just what the name implies— it’s a community that’s dominated by its university population. The college town might have one large university or even a cluster of several smaller schools located in one general area, but college towns are given that nickname because the presence of the school (or schools) strongly affects the community.

The student population in college towns often outnumbers the actual year-round residents, and in most cases the majority of the town’s residents work for the university in one way or another. The university is often the largest employer in the area, and local businesses such as restaurants, coffee shops and bars typically cater to the university as well because students are their biggest customers.

College towns exist throughout the United States: the East coast, the West coast, and everywhere in between. They’re often small or medium-sized towns, and sometimes they’re even districts of a city. In some cases, college towns are the capitals of states, such as Tallahassee, Florida which is home to Florida State University.

College Towns and State Capitals Satisfactory Despite Recession

USA Today has reported that college towns and state capitals are doing okay in the recession. College towns and state capitals “are a refuge from the boom and bust of the private market,” said Robert Lang, urban sociologist at the University of Nevada Las Vegas. “State capitals are where the action is because they developed a white-collar service economy around government.”

Just as grocery stores and electronics supercenters act as anchor tenants in shopping plazas, universities and governments act as anchor institutions in smaller cities, often shielding them from the recession that is hitting the rest of the nation and “providing a buffer against economic whiplash.”

One major reason that college towns aren’t affected by unemployment the same way those “normal” towns are? State governments and universities involved in federally funded research benefitted from the recent stimulus program. “That translates into jobs, which translates into households and people,” explained James Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University.

The majority of jobs lost during times of recession come from the private sector. For example, from December 2007 to December 2009, 8.5 million private-sector jobs disappeared but 90,000 government jobs were created. Hughes explained that “the private sector bore the brunt."

College Towns Have Low Unemployment Rates

On June 28th KBTX.com reported that college towns actually fare well during a recession because university students pump dollars into the local community. Economists have found that towns dominated by a large population of college students fare better during a recession than those without. “We are feast or famine based on Texas A&M University,” said Costa Dellis, owner of Café Eccell and several other restaurants in the area around the school. His advice? "If you are not catering to A&M, then you are not thinking about reality.”

Texas A&M University is located in the appropriately named town of College Station, Texas and economics professor Dr. Thomas Saving provided KBTX with some additional information: he said that during a recession, people who lose jobs or can’t find work often head back to school. “More students come to town, students spend money, said Dr. Saving.”This is a billion dollar operation. This has a gigantic effect on this city.”

The Wall Street Journal reported that Morgantown, West Virginia—home to West Virginia University—has one of the lowest unemployment rates in the U.S. (just 3.9% ) and the university itself has about 260 job openings, from nurses to professors to programmers.

Find a Job in a College Town

Of the six metropolitan areas with unemployment below 4% as of January 2010, three of them are considered college towns. One is Morgantown, and the other two are Logan, Utah— home of Utah State University— and Ames, Iowa which is home of Iowa State University. Both college towns have just 3.8% unemployment. These percentages are based on Labor Department figures that are not seasonally adjusted, and to realize the contrast consider that the unadjusted national unemployment rate is a staggering 8.5%.

Experts are wondering if college towns can continue to thrive as endowments and funding are cut, but for now job seekers who are willing to relocate seem to have a good shot at finding work in a college town.

If you are currently job-hunting, be sure to visit the State University job board which specializes in internships, temporary positions, student jobs, and positions for recent graduates. You can post your resume and learn about opportunities in your area and beyond.


Melissa Rhone+

Melissa Rhone earned her Bachelor of Music in Education from the University of Tampa. She resides in the Tampa Bay area and enjoys writing about college, pop culture, and epilepsy awareness.

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