Cincinnati earns an overall grade of B+ with a composite score ranking it at the 60.0th percentile among 50 US metros. The city's economic character is most defined by its exceptionally high wage growth, with hourly earnings rising 8.92% year-over-year, and its relatively low unemployment rate of 3.60%, which ranks in the 74th percentile. These metrics suggest a city with a strong labor market, but also one that may pose challenges for businesses looking to hire and retain talent.

Labor Demand

Cincinnati's employment growth rate is 0.43% year-over-year, while weekly hours are deviating -0.149% from the city's own 12-month baseline. This combination signals a labor demand environment that is not particularly robust, with hours worked not increasing significantly despite some job growth, indicating a potential survivor squeeze where remaining workers may be absorbing the load of eliminated roles.

Unemployment

The city's unemployment rate of 3.60% indicates a relatively tight labor market, ranking in the 74th percentile. This means that businesses may face challenges in finding and hiring qualified candidates, and may need to offer competitive wages to attract top talent.

Wage Growth

With a year-over-year wage growth rate of 8.92%, Cincinnati is experiencing rapid increases in labor costs, which may be a challenge for employers. However, this also means that workers have strong purchasing power, which can be beneficial for businesses that rely on local consumer demand.

Cost of Living

Cincinnati's cost of living is relatively affordable, with a percentile rank of 92, driven by a PSF of $189/sqft that is decreasing by 0.5% year-over-year, and an average hourly wage of $36.19. This makes the city an attractive location for talent, as workers can afford a high quality of life without requiring significant wage premiums.

Labor Force Growth

The city's labor force is contracting at a rate of -1.16% year-over-year, indicating a shrinking labor pool. This poses a structural headwind for hiring, as businesses may struggle to find qualified candidates to fill open positions.

Building Permits

The number of building permits in Cincinnati is decreasing by 20.21% year-over-year, indicating a tightening of the housing supply. This signals potential future affordability challenges and may make it more difficult for workers to relocate to the city, which could impact businesses' ability to attract and retain talent.

Days on Market

Homes in Cincinnati are currently sitting on the market for 44 days, with a year-over-year increase of 15.8%. This suggests a slower market, which can be beneficial for workers relocating to the city, as they may have more time to find a suitable home.

Office Economy

Cincinnati's professional talent pool is relatively shallow, ranking in the 36th percentile. The city is best suited for businesses that do not require a deep pool of specialized office workers, such as industrial or logistics companies, and may not be the best fit for tech, finance, or consulting firms that rely on a strong knowledge economy.

In conclusion, Cincinnati offers businesses a unique combination of high wage growth and relatively low unemployment, making it an attractive location for companies that can navigate its tight labor market. However, the city's shrinking labor force and tightening housing supply pose significant risks that decision-makers should carefully consider when evaluating Cincinnati as a potential location.