Ranking cities for business friendliness

 Which cities offer the most opportunities? The answer depends on the criteria against which they are judged. In the past, the top-ranking metropolises of the world were rated based on such indicators as business costs, manufacturing capabilities, and location. However, a new study that measured the world’s strongest hubs of finance and commerce used 51 new variables— such as recycling capabilities, tech savviness, and number of international tourists—to measure how cities were progressing in the 21st century.¹ The results show that both mature and emerging cities offer diverse opportunities for businesses.

According to the study, intellectual capital is a powerful investment. It secures and grows a city’s brain trust. Also, a strong academic base can attract companies from around the world. In addition, universities are big business and can be profitable investments. Among the cities examined, London, Paris, and Tokyo rate highest in their share of the top 500 universities, and the populations of New York, Paris, and Toronto are the best educated. Emerging city Mumbai ranked second in number of medical schools.

There’s no doubt that technology has expanded and will continue to expand a city’s potential for progress. Even in times of economic turmoil, innovation can bolster long-term growth and diversify a city’s economy. Not surprisingly, the populations of Chicago, Houston, Los Angeles, and New York have achieved the highest rankings in e-readiness, which is the ability of a city’s consumers, businesses, and government to usefully access technology. Not far behind, Hong Kong, Singapore, and Sydney are speedily building up their tech savviness.

The quality of life in a city is a criterion just as important as technology and innovation. Most of the mature cities did well in this category, since they’ve had ample time to develop lifestyle assets. Emerging cities, though, have begun to make headway in building their city brands. Hong Kong and Singapore, for example, received high marks for the number of international tourists who flock to these cities. Tourism is a strong indicator for measuring city image. Singapore and Sydney scored high in the quality, availability, and affordability of housing. Big player Paris, however, scored low marks because of its high housing costs.

Keeping the environment healthy as populations grow is another lifestyle factor that is increasingly important to city planners. Small city Frankfurt sets the standard in sustainability. Not only did it rate high in air quality and overall perception of greenness, but Frankfurt also scored highest in recycling. In an effort to reduce landfill dependence and promote eco-friendly behavior, Frankfurt’s residents must pay fees based on the weight of their non-recycled waste.

Naming the city that offers the most oppor­tunity is not the intention of this study. There
is no single winner. Rather, different cities can and do offer diverse opportunities unique to their particular urban experiences.