Sun Belt areas led by Dallas will reach full employment faster than cities such as New York, which suffered deeper job losses due to COVID-19, a new report showed.

Austin and Phoenix are also expected to make a faster economic recovery from the pandemic than other major U.S. cities, according to a labor-analytics report from software firm, ThinkWhy. Its LaborIQ ranking weighed such factors as working-age population growth, migration and education. Atlanta and Tampa round out the top five.

Those cities “will have some of the strongest population growth the next few years due to the health of their job markets,” said Jay Denton, chief innovation officer at Dallas-based ThinkWhy.

The outlook for recovery is tempered by a surge in coronavirus cases as a latest wave of infections sweeps the nation, sparking new round of tighter restrictions. Texas, the second-most populous state, earlier this month became the first U.S. state to surpass 1 million cases.

Employment in the Sun Belt cities cited in the report have suffered much less than the national average drop of 9.4% as of the second quarter from a year earlier. Among the 10 largest counties, the Bureau of Labor Statistics shows that the New York City area had an employment decline of 18.8%, Cook County in Chicago a 13.1% drop and California’s Orange County and Los Angeles saw decreases of 12.7% and 12.2%, respectively.

By comparison, Maricopa county in Arizona, which includes Phoenix and its suburbs, saw a drop of just 4.6% and sectors such as finance and construction were fully recovered by June.

LaborIQ’s No. 1-ranked Dallas experienced an annual employment decline of 5.8% in June. But with its 2.2 million college graduates along with strong migration and wage growth, the area is set to recover quickly, according to the report.

The Dallas finding is bolstered by data from Kastle Systems which tracks electronic access to office buildings and found that Dallas leads the country with 42.2% of workers returning to offices. That compares with less than 20% returning by Nov. 10 in New York, Chicago and San Francisco.

By 2021, LaborIQ forecasts that all sectors in Dallas will be at least 99% recovered including leisure and hospitality. By contrast, that sector is not expected to recover until 2025 in New York City.

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