Acknowledgements

The authors would like to thank William Trolinger for his lead in automating the acquisition and analysis of the data used in this report and Madeline Boss for her data-visualization work. We would also like to thank for sharing their expertise and perspectives with us:

• Tim Lehmberg, executive director of the Gillespie County Economic Development Commission
• Jonas Arjes, executive vice president and chief economic development officer with the Branson/Lakes Area Chamber of Commerce and Convention and Visitors Bureau

Executive Summary

The 2024 Most Dynamic Micropolitans report explores how towns with 10,000 to 50,000 residents and the outlying areas with close economic ties to those communities have fared since the COVID-19 pandemic. And based on data from more than 500 of those communities, micropolitans in the United States (U.S.) are economically strong and well positioned for the future. Los Alamos, New Mexico, held steady as the most dynamic micropolitan region in the U.S.

Many urban areas continue to struggle with office vacancies due to an increase in remote work, more emphasis on quality of life and a resistance to commuting. Those same factors, however, have made micropolitan areas more attractive. Strong tourism, manufacturing and petroleum-related industries contributed to the economic success of the most dynamic micros on this year’s index.

This report intends to identify trends across dynamic micropolitans and to highlight top performers, as well as those that significantly improved from last year. While petroleum-fueled micropolitans that depend on oil-and-gas related industries continue their success of recent years, they remain prone to boom- and-bust cycles due to the volatile market nature of nonrenewable sources. As a result, they do not provide universally applicable trends and insights for other communities.

Therefore, we chose to focus our attention in this report on trends that are replicable, such as those in tourism, manufacturing and cultivating quality places. Communities that heavily depend on mining, refining and pipeline distribution—such as Town of Pecos, Texas; Liberal, Kansas; and Gillette, Wyoming— have been featured in previous reports and benefit from unreplicable resource endowments, limiting the additional lessons to be learned for non-endowed micropolitans.

TOURISM

Tourism was a major economic factor in many of the most dynamic micros. Outdoor recreation drew national and international visitors to the beaches of Key West-Key Largo, Florida (5^th overall), and the ski slopes of Breckenridge, Colorado (9^th overall). Micropolitan regions in the heartland and Mountain West draw visitors to their natural beauty and recreational amenities.

Many dynamic micros are developing additional attractions and building businesses that expand activities for tourists looking to enjoy the outdoors. Sevierville, Tennessee (23^rd overall), is an example of a heartland community investing in its tourism sector through “The 407: Gateway to Adventure.” This 200- acre development is funded by the Eastern Band of Cherokee Indians and will develop dining, shopping and other entertainment options in phase one, with high-end amenities planned in the future to diversify offerings.

Tourism-driven economies can fluctuate widely, as they largely depend on discretionary spending. One community that has seen big increases in tourism is Branson, Missouri, in the Ozark Mountains. It ranks 119th overall this year, up 359 spots from 2022. Attractions include shopping at Branson Landing, Silver Dollar City theme park and outdoor recreation at Table Rock and Taneycomo, such as canoeing, fishing, swimming, water skiing, hiking and birdwatching.

Other dynamic micropolitan regions have also leveraged their proximity to major metros by attracting tourists and new residents with their high quality of life and recreational amenities.

Hybrid and remote work models make living outside the traditional commuter radius of big-city jobs feasible, stimulating growth in places like Heber, Utah (fourth overall), next to Provo and Salt Lake City; Brenham, Texas, between Austin and Houston; and Fredericksburg, Texas, near Austin and San Antonio. These heartland communities near major metros are seeing the combined effects of remote work and high urban housing costs spur in-migration. Development that fits into the local economy helps maintain the local character and appeal; however, growth can impact the availability of affordable housing and employment, creating pressing issues for policymakers. Without local jobs that can pay competitive wages in tighter housing markets, former residents may be forced to commute to their jobs in the micro. For long-term prosperity, heartland micropolitan regions must continue to build on local strengths and diversify their economic base to avoid the volatility of individual industries and to create more local economic opportunities.

MANUFACTURING

The manufacturing sector is a major driver of the U.S. economy, contributing more than $2 trillion in 2023. Micropolitan regions across the heartland are home to well-paying manufacturing firms. Advancements in manufacturing technologies, favorable trade policies and recollections of the supply-chain disruptions during the COVID-19 pandemic all contribute to this trend.

Blytheville, Arkansas (54^th overall), benefits from its proximity to Watco’s Blytheville Marine Terminal, a barge-and-rail terminal on the Mississippi River specializing in the transport of bulk fertilizer, liquids and steel. Blytheville also is home to steel-recycling giant Nucor Steel and has seen additional major steel-related investments. The presence of Arkansas Northeastern College in the micro helps attract these investments, as firms can partner with the college to develop workforce-training programs that consistently produce local, highly skilled workers.

A strong manufacturing presence in Magnolia, Arkansas, has helped raise average annual pay by 19% and real GDP by 13.3% over a five-year period. In our rankings, this micro rose from 267^th to 243^rd overall. The processing of various heavy metals found locally has stimulated interest and investment in Magnolia. In addition to the expansion of bromine-processing facilities recently announced by the Albemarle Corporation, new techniques for lithium extraction for electric-vehicle batteries led ExxonMobil to acquire land in the region with plans of building a lithium production facility.

The 325 micropolitan communities in the heartland of America delivered mixed results this year. More than half (111) of our top 200 most dynamic micros are in the heartland, and roughly half (49) of the top 100. Its important to note the Texas economy is fueling many of the micros in the top tier; of the 17 that are in the top 50, nine are in Texas. The strategies for success in our heartland micros centered around manufacturing or outdoor recreation and tourism. Micropolitans with petroleum-related activity have done well but remain prone to the boom-and-bust volatility of the industry.

Some of the micros are within driving distance of thriving metro areas, allowing local businesses to logistically support the nearby metros while also drawing people to potentially settle in the micro. The heartland manufacturing sector’s continuous support for the American economy is no small feat. As technological innovation and advanced manufacturing techniques drive up demand for products like electric vehicles and their battery components, the demand for highly skilled labor has also increased across the heartland. The key to continued steady growth might still rest with these sectors.

ES 1 – TOP 25 MICROPOLITAN AREAS

1. Los Alamos, New Mexico
2. Jefferson, Georgia
3. Jackson, Wyoming – Idaho
4. Heber, Utah
5. Key West-Key Largo, Florida
6. Cedar City, Utah
7. Town of Pecos, Texas
8. Monticello, New York
9. Breckenridge, Colorado
10. Hailey, Idaho
11. Rifle, Colorado
12. Edwards, Colorado
13. Hobbs, New Mexico
14. Fredericksburg, Texas
15. Spearfish, South Dakota
16. Steamboat Springs, Colorado
17. Durant, Oklahoma
18. Brenham, Texas
19. Sandpoint, Idaho
20. Kalispell, Montana
21. Rexburg, Idaho
22. Seaford, Delaware
23. Sevierville, Tennessee
24. Granbury, Texas
25. Nantucket, Massachusetts

Introduction

The 2022 edition of the Most Dynamic Micropolitans told how micropolitan statistical areas (or micros) navigated the challenges imposed by COVID-19. This unforeseen threat significantly slowed economic growth across the globe, but this edition shares how these regions have begun a new chapter of recovery and regrowth.

This 2024 edition of Most Dynamic Micropolitans highlights the vital role of three more factors that are shaping economic growth in the top micro areas: tourism, manufacturing and location.

By definition, micros are typically a county with a core city whose population is 10,000 to 50,000, and they are not part of a larger metropolitan statistical area (a group of counties, where each has an economic relationship with a central city of more than 50,000 residents). Micro areas face unique economic- development opportunities, such that diversification and multi-industry strategies used in metro areas often do not work in these smaller regions. But, our analysis shows that micro areas can capitalize on their strengths through specialization.

Los Alamos, New Mexico, maintains its status as the most dynamic micropolitan region in the United States (U.S.), reclaiming its top ranking of 2022. Unusual factors continue contributing to its performance on our index. For instance, in 2018, the $2.5 billion contract for management of the national lab operations was awarded to Triad National Security by the U.S. Department of Energy (DoE). This increased the area’s performance on our young-firm employment share (72.1%) and knowledge intensity (37.3%) metrics. This advantage will fade once Triad is no longer categorized a young firm, given the concentration of employment at this one employer.

The expansion of Los Alamos National Laboratory, however, has contributed to the region registering the highest overall employment growth on our economic momentum measure, which tracks jobs added between September 2022 and September 2023 (12.3%). The combination of this job growth and high per capita personal income ($99,183) has the potential to fuel additional local economic activity. You can learn more about Los Alamos by reading our feature in the 2022 Most Dynamic Micropolitans report.

Meanwhile, the oil-and-gas industry continues to fuel the economies of the same communities in both metropolitan and micropolitan areas. Places like The Town of Pecos, Texas (formerly just Pecos), is located in the Permian Basin, which is the top-producing oilfield in the nation—placed seventh and was the only heartland micro in the top 10. Rifle, Colorado (11^th overall), straddles the foot of Roan Plateau, whichcontains some of the world’s largest deposits of natural gas and oil shale. Hobbs, New Mexico (13^th overall), is the largest city in Lea County and also one of the top oil-producing counties in the U.S. We explored the influence the oil-and-gas industry had on micro regions in more detail in our 2022 edition of the Most Dynamic  Micropolitans report.

The rebound in the manufacturing specialized communities aided economic development in general. Jefferson, Georgia, secured its 2^nd overall ranking through a long-term investment made in 2018 with the South Korean firm SK Innovation to develop lithium battery manufacturing plants in Jackson County. In the heartland, especially in the state of Arkansas, a shining example is Blytheville, which ranks an impressive 54^th overall, due mostly to its steel-manufacturing concentration; and Magnolia, with a tremendous amount of investments and support by firms and state government to expand operational capacities in terms of battery components to support the electric-vehicle industry.

As for the top 25 micros overall, tourism is the dominant theme—it has been a primary determinant of economic growth in the post-COVID-19 era across the U.S., both in metro and micro areas. This trend is evident, as seven of our top 10 micros specialize in tourism. Jackson, Wyoming-Idaho (3^rd); Heber and Cedar City, Utah (4^th and 6^th); Key West-Key-Largo, Florida (5^th); Monticello, New York (8^th); Breckenridge, Colorado (9^th); and Hailey, Idaho (10^th), have all benefited from a strong tourism sector, with frequent travelers seeking leisure time in the mountains or at ski resorts, beaches or historic museums.

Beyond the top 10, tourism communities are following the same path as most of the elite micros by offering plenty of activities in places like Edwards, Colorado (12^th); Fredericksburg, Texas (14^th); Spearfish, South Dakota (15^th); Steamboat Springs, Colorado (16^th); Standpoint, Idaho (19^th); Kalispell, Montana (20^th); Rexburg, Idaho (21^st); and Nantucket, Massachusetts (25^th). Heartland micros such as Durant, Oklahoma (17^th); Brenham, Texas (18^th); and Granbury, Texas (24^th) also have a strong presence in tourism. Durant is the capital of the Choctaw Nation, famous for its casino resorts and other tourist attractions; Brenham is known for its annual Maifest, a celebration of the German heritage that was first held in 1881, making it one of the oldest festivals in Texas; and Granbury prides itself on being named USA Today’s Best Historic Small Town in America three years in a row, starting in 2019. It was also designated the Celebration Capital of Texas in 2023.

TOURISM

Micropolitan communities specializing in tourism have leveraged their geographic advantages to post relatively strong performances in this year’s rankings.

As we found in the micropolitan report in 2022, people sought comfort and tranquility after the COVID-19 pandemic, particularly in metro and micro areas across the heartland and Mountain West states. These regions have provided excellent escapes because they offer sanctuaries where people can decompress and restore their sense of equilibrium. Some communities have invested in major attractions to pull in visitors, while others have relied on their tranquility and proximity to major population centers to draw local visitors alongside new residents willing to take on a longer commute in exchange for life in a scenic community.plied to adjust income and wage figures to compare prices of local goods and services prices against the national average. Additionally, we crunched numbers from the Bureau of Labor Statistics (BLS), BEA and Census Bureau to arrive at a standardized z-score for each MSA, indicating its economic performance relative to the mean, measured in standard deviation units. MSAs are then ranked based on their average z-scores across all evaluated metrics.

TOURISM: INVESTING IN MAJOR ATTRACTIONS

As the nation’s economy began to regroup, these tourism-strong communities continued to attract visitors seeking to maintain the work-life balance they found during the pandemic. The heartland’s micro areas, specifically, are no strangers to this phenomenon and, thus, continue to thrive.

Sevierville, Tennessee (23^rd overall), located about 30 miles southeast of metropolitan Knoxville, has invested in tourism in a big way over the past few years.

One of its most ambitious economic development projects—The 407: Gateway to Adventure—is a 200-acre development at exit 407 off Interstate 40. Leaders envision the project as the crown jewel of entertainment destinations in Sevierville, aiming to transform the region’s profile by adding top-tier amenities.

This $75 million project¹ is funded by the Eastern Band of Cherokee Indians through its business-development firm, Kituwah, LLC. Work began in April 2023 on the first phase of the project called The Smokey Gap, which will feature dining, shopping and other entertainment. It is expected to open in 2025. The site will also welcome businesses like Buc-ee’s and the French theme park franchise Puy du Fou, which will open its first North American location. The diverse project is also looking to include a world-class golf course, luxury hotels, an indoor go-kart facility and a distillery.

Mayor Robbie Fox of Sevierville, Tennessee, and the Chief and Chief Richard Sneed of the Eastern Band of Cherokee Indians both expressed unwavering support for this initiative, praising it as a necessity for economic development.²

Exit 407 serves as a strategic location on Interstate 40. In 2021, for instance, more than 40,000 vehicles a day took this exit, according to the Tennessee Department of Transportation.³ Project 407 will bring in more traffic as the development nears the finish line and for years to come.

Sevierville’s medium-term (2017-22) growth rates in employment (9.3%), average annual pay (33%) and real GDP (22.1%) together have produced a top 30 ranking this year. The cooperation of local government and private entities solidifies the city’s goals to foster its economic growth and enhance its quality of life. The positive growth in employment, average annual pay and real GDP over the five-year period exemplifies its competitive position in comparison to other micros around the country. Once Project 407 is built and opens to the public, the Sevierville micro is poised to further increase its attractiveness to tourists and investors and to maintain its economic specialty.

Branson, Missouri, also stood out this year. The Ozark Mountain getaway is 119th overall, up a whopping 359 spots from 2022. Its tourism industry is mainly fueled by attractions like the established theme park Silver Dollar City; the Thunder Ridge Nature Arena, an amphitheater in Ridgedale, Missouri; and various other outdoor recreational activities involving the areas lakes and mountains.

Branson’s short-term employment growth (2.4% for 2021-22), along with short-term employment momentum (1.9% for September 2022-September 2023), are important indicators of the Branson micro’s ability to ensure its supply of workers meets the increasing demand of tourists in these post-pandemic times. Their 2017-22 and 2021-22 real GDP growth (11% and 4.6%, respectively) also testifies to their economic specialty in the tourism sector.

Branson’s location in the rolling Ozark Mountains provides tremendous outdoor recreational activities. The Branson lakes area is perfect for enthusiasts who enjoy just about any outdoor activity, including simply wandering through the hills. Branson also has world- class golf courses such as the Ozark National Golf Course near Ridgedale, that provide opportunities for the novice and the experienced player alike.

The ever-increasing stream of travelers flowing to Branson is beneficial to its economy and sets an example of showcasing geographic advantages to attract visitors from far and wide.

Naturally, tourism fluctuates just like every other sector of the economy. Jonas Arjes, executive vice president and chief economic development officer with the Branson Lakes Area Chamber of Commerce & Convention and Visitors Bureau (CVB), described some challenges his community faces.

“Even though Branson has a robust tourism industry, it is still seasonal,” he said. “There’s not a steady 12-month tourism economy. During the offseason [January-late March), we have some businesses that close. People and businesses must figure out how to adapt, and they do. The seasonality has a pattern, allowing some people to work secondary jobs, and most businesses learn how to schedule based on those historic fluctuations throughout the season.”

Seasonality will always impact communities that rely on tourism. Nonetheless, the foundation of economic resilience comes down to people and how well they navigate and adapt to economic uncertainties.

Every community’s survival relies on its people, and every tourism community’s ability to survive relies on the service industry. Hospitality draws travelers around the country to come back to visit these tourism towns. Tourists travel to make fond memories and to tell stories to their friends and family when they return home. It’s vital for tourism-dependent micro areas to maintain a high degree of hospitality and to ensure that growing numbers of people are willing to travel hundreds of miles just to visit their communities.

“Our [Branson’s] customer-service culture is Ozark Mountain hospitality,” Arjes said. “It isn’t a marketing ploy or strategy; it’s just our way of life. One of the things that this community has done a really good job of over the decades is the ability to secure repeat business. Once the visitors come here for the first time, there is a high probability that they are going to come back the next year, or the year after. That is a testament to the hardworking and genuine people in Branson.”

TOURISM: LEVERAGING LOCATION AND QUALITY OF PLACE

Several micropolitan regions, and especially those near major metro areas, have successfully leveraged their location to anchor their local economies. The combination of rising housing costs and the options for remote work have made living outside the traditional commuter shed—the area within which one might reasonably commute daily to work—more attractive. Coming out of the COVID-19 pandemic, there has also been a shift in the perceived value of quality-of-life factors relative to proximity to the office.

Micropolitan areas strong in local tourism and easy access to the outdoors rated among the most dynamic on our list. Those that continue to build on local strengths and support a more economically diverse industry base will be more likely to sustain this dynamism.

A strong state economy drawing people and businesses has helped micropolitan areas outside the major urban centers in Texas make their presence known on our most dynamic micros index, with nine in the top 50.

Shooting up the rankings from 192 to 18 this year, the Brenham micropolitan statistical area covers Washington County and sits between Houston and Austin. The region has experienced steady population growth in recent years and ranked 4^th in 12-month job growth at 6.9%.

Rising oil prices have helped Houston prosper, and nearby Brenham’s tourism has benefited with an increase of visitors to events such as Maifest, the annual German heritage festival.⁴ It has established businesses like Blue Bell Creameries, which has made ice cream in the Brenham micro since 1907 and now serves a multistate market.⁵ And Brenham’s strong highway and rail connections to Houston and Austin make it attractive to new businesses.

Outside the heartland, three of Utah’s four micros rank in the top 50, paced by Heber (ranked 4^th overall). Located next to the growing Salt Lake City and Provo-Orem metros and enjoying a high quality of life, Heber has seen rapid in-migration. It offers outdoor recreation in the mountains, state parks and national forests, along with easy access to jobs in Provo and Salt Lake City.⁶ The region had the second-highest per capita income in 2022 ($171,191), but affordable housing has become a concern, as competition for housing has increased and the local workforce increasingly has to drive from outside the micro (up to 75 percent of workers by some estimates for Summit County).⁷

Fredericksburg, in central Texas, moves up seven places to 14^th overall this year. The region markets itself as the Texas Hill Country and offers residents a mix of access to nature and a greater variety of amenities than the local population could support, thanks to drive-in tourism from nearby San Antonio and Austin. Since the Austin-Round Rock-Georgetown metro continues to outperform its peers—it has the best five-year record among large metros on Heartland Forward’s Most Dynamic Metros index—proximity to this consistent economic engine presents many opportunities to nearby communities to attract some discretionary spending. Entrepreneurs are seizing the opportunity, which led to the region being ranked 3^rd for share of local employment in young firms (20.6%).

Weekend visitors to Fredericksburg can enjoy activities year-round, reducing the seasonality factor that can limit tourism in more specialized micros. Options include hiking and climbing in the Enchanted Rock State Natural Area or viewing fields of colorful wildflowers in the spring.⁸ Agritourism is a major year-round draw, with a growing number of wineries, vineyards and tasting rooms attracting new types of visitors to the region. With its mom-and-pop stores in the historic core protected by restrictions on chain businesses, Fredericksburg works to keep its distinct local character.

Some visitors are tempted to take up residence and enjoy a higher quality of life and sense of community. Like many rural micros, the median age of the local population (49.7 years) is significantly higher than the Texas average (35.6 years), and attracting new residents could help the area’s long-term sustainability. The region has experienced moderate population growth in recent years. Too distant to serve as a bedroom community, housing prices have not risen as fast as some rural micros near booming cities that have seen rapid in-migration. However, housing is still a concern.

Strong medium-term (2017-22) employment growth (14.1%) and the 11^th-highest per capita personal income ($94,701) have helped build the local tax base in recent years. The lack of affordable housing and competition for labor keeps local wages higher than might be expected in a community of its size, and like in Heber, Utah, many service workers have to drive into town for work.

Fredericksburg is pursuing an economic-development strategy that builds on its strengths. Thanks to the robust Texas economy and businesses relocating there, the micro gets its share of interest. Fredericksburg is judicious about encouraging the opportunities that best fit the local resources, community and character. This means choosing not to pursue some great firms and instead directing them to partners in other communities that might be a better fit.

Employment is concentrated in leisure and hospitality, retail and wholesale, health care and administrative services; however, there is a desire to expand into new areas, thus building a more diversified economic base. Although rural access to health care is a critical challenge in other micros, Fredericksburg has the advantage of being home to a regional hospital. In the medium term, more high-wage jobs are needed to round out the city’s economic profile, though the expertise and financial resources of new residents could yield startups in new fields.

Micropolitan areas near major metros can benefit from local tourism and draw those seeking access to the outdoors and a slower pace of life. Proximity to major economic hubs can push high earners from the cities out to bedroom communities, pricing out locals who then must drive in to work in service jobs. The challenges for bedroom communities extend beyond concerns about affordability of housing for locals. They can lead to a lack of local economic diversity, a dearth of local high-wage jobs and limited opportunities for those wishing to work locally. Finding a balance, or using policy and investments to steward the character of local places, can help micros build on their strengths and maintain quality of life-driven communities that continue to evolve and attract new residents.

Manufacturing

The manufacturing sector serves as an important indicator for the health of the entire U.S. economy, adding about $2.89 trillion in value to the national economy in 2023, according to the National Association of Manufacturers.⁹ And the industry is deeply connected to the heartland.

This reality is magnified in Arkansas, where manufacturing jobs in 2022 accounted for more than 10% of all nonfarm jobs. Moreover, Arkansas recorded $24.1 billion in value added to the economy from manufacturing, which comprised 14.5% of the state’s GDP in 2022. The fruits of this labor yield the $5.2 billion worth of goods exported from the state to countries including Canada, Mexico, the United Kingdom, China and the Netherlands.¹⁰ Manufacturing strongholds in Arkansas towns like Blytheville and Magnolia employ thousands of highly skilled workers, paying them competitive wages that help fuel the state’s economy.

The Blytheville micro (54^th overall) is in Mississippi County, about 70 miles northwest of Memphis. Its strong transportation infrastructure includes Interstate 55, and the region benefits from its proximity to the Mississippi River that houses the Watco Terminals, a barge and rail terminal that specializes in handling bulk fertilizer, liquids and steel.

The Arkansas Aeroplex, meanwhile, is one of the largest industrial complexes in the state, with 1.5 million square feet of space. This multifunctional complex comprises a variety of facilities, such as commercial, recreational and warehousing spaces. The Arkansas International Airport at this complex has the state’s longest runway available for public use, measuring about 11,600 feet (more than two miles).¹¹

The Blytheville micro also prides itself for its steel- manufacturing sector, which has seen a constant inflow of multimillion-dollar investments. Blytheville is home to Nucor Steel, the world’s largest steel recycler. The firm owns several mills, led by Nucor-Yamato and Nucor Steel Arkansas.

Zekelman Industries, North America’s largest steel pipe and tube manufacturer, recently announced a planned investment up to $120 million to improve manufacturing capabilities and product range through its Mississippi County subsidiary, Atlas Tube. The expansion is projected to double Zekelman’s workforce to more than 300 employees. More importantly, the announcement includes a commitment to collaborate with Arkansas Northeastern College on a workforce training program to prepare the next generation of Arkansas’ highly skilled workforce.¹²

Blytheville performed well in several categories that solidify its strong showing in our overall rankings, notably in short-term employment growth (3.1%) and impressive momentum growth during the 12-month period (5.2%). Its five-year growth in average annual pay and real GDP are both more than 30% (39.2% and 33.2%, respectively). These few measures were enough to position Blytheville as Arkansas’ top micro.

In the southern part of the state, Magnolia is an important industrial center. Thanks to significant involvement in the oil and bromine industries, it improved its position by 267 spots from its previous ranking, landing at 243rd overall.

Magnolia has an impressive record of 19% growth in average annual pay and a solid 13.3% increase in real GDP over the five-year period of 2017-2022. An industrial presence provides a foundation for the local economy and creates diversified employment opportunities in manufacturing.

Significant investments in recent years point to the potential for Magnolia to keep improving its ranking. The $540 million expansion by Albemarle Corporation includes two bromine facilities that are set to create around 250 construction jobs and a projected 15% increase in total jobs across the two facilities, with an average annual salary of $100,000.¹³ This investment signals the micro’s capacity for developing large-scale industrial projects.

The recent discovery of significant brine deposits in the region’s Smackover Formation generated national and social media coverage touting its potential impact on the Magnolia micro’s economic growth. Brines contain concentrations of lithium, a heavy metal that is extremely valuable for commercial use thanks to the increasing demand for electric-vehicle battery production. Using a technique known as end-to- end direct lithium extraction (DLE), companies can efficiently extract lithium from the Smackover brine and turn it into battery-grade lithium for commercial use.

ExxonMobil, which acquired 120,000 acres in south Arkansas, hopes to create a lithium production facility there by 2027. The company’s ambitious goal is to produce enough lithium to supply more than 1 million electric vehicles by 2030.¹⁴

Southern Arkansas has a history of being a powerhouse in petroleum, natural gas and bromine manufacturing. Manufacturing trends in recent years lean toward serving the increasing demand for the production of semiconductors, electric vehicles and their battery components. With the addition of lithium extraction in Magnolia, the state is on the edge of experiencing a manufacturing boom for years to come.

Conclusion

Unpredictable external shocks like the COVID-19 pandemic can topple any economy rather quickly, but micropolitan communities dependent upon a single industry are more vulnerable to boom-and-bust cycles. It is vital for these smaller communities to explore new ways to nurture a diversified industrial base and an economy that runs 12 months of the year.

Achieving economic diversification is always easier said than done because regions have to build on their existing strengths and capacities, starting from the realities of their infrastructure, workforce, resources and culture to promote growth.

Partnerships between private entities, local governments and educational institutions could help foster the growth of new industries in micro communities. Collaborations could range from developing appropriate training for the local workforce to stimulating a culture of innovation and entrepreneurship. As quality-of-life and cost-of-living factors make urban centers less attractive, micro regions have the opportunity to attract highly skilled workers to settle; in time this could draw firms and investment capital that can help bolster economic diversity.

Building a diversified economy requires time, effort and faith in the community. Many micros have the benefit of passionate local leaders who are dedicated to fostering a robust economic future for their community. While every modern metropolitan area once was a small community, not every micropolitan aspires to be that large. Efforts to strengthen the economic resilience of micro communities in a way that creates opportunities and security for residents while maintaining community values will benefit from a clear shared vision of the future.

Appendix

The 2024 Most Dynamic Micros are derived from analyzing economic indicators across available micropolitan statistical areas in the U.S. These measurements are selected as:

• Average annual pay
• Employment
• Real gross domestic product (GDP, measured in 2017 dollars)
• Per-capita personal income
• Share of total employment at firms ages five years and under (young-firm employment share)
• Share of employees at young firms with a bachelor’s degree or higher (young-firm knowledge intensity)

These metrics are then placed into time-sensitive categories for analyzing short- and medium-term economic trends in each micropolitan area. Short-term growth (2021-2022) examines yearly shifts in metrics, including growth in real GDP, jobs and wages. The September 2022 to September 2023 job growth is defined as short-term employment momentum.

Medium-term growth is defined through growth in jobs, wages and real GDP in the five years from 2017 to 2022. We also included the 2022 personal income per capita level to indicate the general well- being of residents in a micro, measured in dollars. Furthermore, measurements such as employment share in young firms and knowledge intensity are taken into consideration when examining a region’s entrepreneurial activity and innovation potential. These evaluations closely follow the micropolitan statistical area definitions by the federal Office of Management and Budget (OMB), whose accessible data this year allowed for the analysis of 527 micros.

A notice by the Census Bureau on June 6, 2022, announced that Connecticut would no longer have a system of counties. Instead, it would introduce nine planning regions, which will act as county-equivalent geographic units. As a result, all micropolitan statistical areas in the state will not be taken into consideration regarding the overall analysis due to the Bureau of Economic Analysis (BEA) and the Bureau of Labor Statistics (BLS) not being able to adopt the changes in time.

Additionally, the regional price parity (RPP) from the BEA is applied to adjust income and wage measurements to compare prices of local goods and services against the national average.

Lastly, we calculate all aforementioned measurements from the BLS, BEA and Census Bureau to arrive at a standardized z-score for each micropolitan area, which serves as an indicator for its economic performance relative to the mean, measured in standard deviation units. Micro areas are then ranked based on their average z-scores across all evaluated metrics.

TABLE 1 – MEASUREMENTS AND SOURCES

MEASURE	TIME PERIOD	SOURCE
Young Firm Employment Ratio	2022	Census Bureau
Young Firm Knowledge Intensity	2022	Census Bureau
Per-Capita Personal Income	2022	Bureau of Economic Analysis
Medium-Term Job Growth	2017-2022	Bureau of Labor Statistics
Short-Term Job Growth	2021-2022	Bureau of Labor Statistics
Short-Term Job Growth Momentum	September 2022-September 2023	Bureau of Labor Statistics
Medium-Term Average Annual Pay	2017-2022	Bureau of Labor Statistics
Short-Term Average Annual Pay Growth	2021-2022	Bureau of Labor Statistics
Medium-Term GDP Growth	2017-2022	Bureau of Economic Analysis
Short-Term GDP Growth	2021-2022	Bureau of Economic Analysis

TABLE 2 – OVERALL TABLE

ENDNOTES

1. Kituwah LLC breaks ground on Smoky Gap Enter- tainment District at the 407: Gateway to Adventure. (2023, April 10). The One Feather. https://theonefeath-er.com/2023/04/10/kituwah-llc-breaks-ground-on-smoky-gap-entertainment-district-at-the-407-gate-way-to-adventure/
2. Lossiah, J (2023, April 13). “An experience for the ages”: 407 Project holds latest groundbreaking. One Feather. https://theonefeather.com/2023/04/13/an-experience-for-the-ages-407-project-holds-latest-groundbreaking/
3. Russell, M (2023, December 19). Exit 408 funding included in new TDOT 10-year project plan. WJHL. https://www.wjhl.com/news/regional/tennessee/exit-408-funding-included-in-new-tdot-10-year-project-plan/
4. Lange, N. L. (2024, February 12). Brenham Maifest: The Oldest Festival in Texas. Visit Brenham Texas. https://visitbrenhamtexas.com/maifest/
5. Blue Bell Creameries & Ice Cream Parlor – Visit Brenham Texas. (2024, June 4). Visit Brenham Texas. https://visitbrenhamtexas.com/accounts/blue-bell-creameries-ice-cream-parlor/
6. Heber Valley Tourism and Economic Development | Attractions. (n.d.). https://www.gohebervalley.com/at-tractions/
7. M, L., & M, L. (2024, May 15). Wasatch Back Summit charts future with focus on affordable housing, tran- sit, and zoning innovations. TownLift, Park City News. https://townlift.com/2024/05/wasatch-back-summit-charts-future-with-focus-on-affordable-housing-tran-sit-and-zoning-innovations/
8. Things to do in Fredericksburg, Texas | Attractions & Nightlife. (n.d.). https://www.visitfredericksburgtx.com/things-to-do/
9. National Association of Manufacturers. https://nam.org/manufacturing-in-the-united-states/
10. National Association of Manufacturers. https://nam.org/manufacturing-in-the-united-states/regions/arkan-sas/
11. Encyclopedia of Arkansas. https://encyclopediaofar-kansas.net/entries/eaker-air-force-base-2795/#:~:tex-t=The%20Arkansas%20Aeroplex%20has%20utilized,-public%20use%20in%20the%20state
12. Business Facilities (2024, May 6). Steel Industry In Ar- kansas Grows With Bekaert And Zekelman Expansions. https://businessfacilities.com/steel-industry-in-arkan-sas-grows-with-bekaert-and-zekelman-expansions/
13. Brock, R (2022, November 9). Albemarle Corp. In- vesting Up to $540 Million in Magnolia Facilities. Talk Business & Politics. https://talkbusiness.net/2022/11/albemarle-corp-investing-up-to-540-million-in-magno-lia-facilities/
14. Demillo, A (2023, November 13). Exxon Mobil Is Drilling for Lithium in Arkansas and Expects to Begin Production by 2027. Associated Press. https://apnews.com/article/exxon-mobil-lithium-electric-vehicles-min-ing-arkansas-ae08d5835ff8600d71b78d03aa746b83

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