Which Cities Have the Most and Least Diversified Economies

Don’t put all your eggs in one basket.” Words to live by, according to general investor wisdom, and one of the best safeguards against market volatility. But the principle applies to more than investing practices. U.S. cities that put the same words into action sailed gracefully through the global economic storm.

Some researchers have found that greater professional diversity increases a city’s productivity, a pattern that is present across growing and large urban areas in the U.S. And the trend is consistent globally. Referring to countries, the United Nations Industrial Development Organization contends that “more diversified economies are less volatile in terms of outputs, and lower output volatility is associated with higher economic growth.”

Diversification helps an economy the way that it protects an investor’s portfolio: Within a certain time period, job gains in some sectors will offset the losses in others. During the Great Recession, for instance, the number of professions in health care and social assistance multiplied while construction and manufacturing occupation rates declined, according to the U.S. Bureau of Labor Statistics.