Balance works best in urban ecosystems.
Education, transit, health, economics, and governance all have to line up for a city to lead. London proves this again as its balanced strengths create distance from other advanced cities. Further, eight cities make the top 3 in two or more indicators—London, Singapore, Paris, Beijing, Sydney, Toronto, Stockholm, and New York. This confirms cities need a good combination of social and economic strengths to succeed.
The good life is not a luxury.
It’s a basic requirement for cities and businesses to get and keep talent. Our quality of living variable shows the strongest relationship with overall success in the study, as well as with 10 other telltales of urban wellbeing.
A great city delivers shared good.
Cities need to support real human needs to work as balanced ecosystems; a civilized society handles the tests and provides broadly. Senior wellbeing, housing, relocation attractiveness, disaster preparedness all relate strongly with overall score and top performance in a wide range of healthy measures.
Intellectual work anchors modern city economies.
City people and business need good education to prosper. Finance and business services contributed almost half to GDP growth of our cities from 2010 to 2015. And that doesn’t count intellectual work in healthcare, life sciences, technology, communications, and other sectors.
Greater systemic resilience can be a dividend.
A good example is offered by the top 10 cities across intellectual capital and innovation, technology readiness, and city gateway (collectively, our Tools for a Changing World). Paris and Amsterdam make the top 10 list in this grouping after almost a decade of financial turmoil in Europe. Tokyo remains in the top 10 after Japan’s “lost two decades” of stagnation. Neither Rome, nor any of our top cities, were or will be built in a day. But the work is worth it.
A dependable workforce associates with city leadership.
A city that takes care of business on the office and shop floor has a better chance of success. Low workforce management risk relates strongly with high city productivity; ease of doing business; intellectual capital; health, safety, and security; and overall score.
Taxes add an ingredient to the local recipe for success.
And the tax system in our three top cities, London, Singapore and Toronto, compare well. An analysis of corporate total tax rate, personal rate, and tax efficiency shows Dubai, Hong Kong, and Singapore have the lowest rates and highest efficiency collectively. But London and Toronto are not far behind. However, it’s hard to take taxes out of the context in which they are paid in terms of economic, political, social, demographic, and environmental ecosystems and the needs of cities, their businesses, and citizens.
Modern risks add a major test.
Achieving and sustaining resilience proves a challenge today against a wide range of modern risks. Disaster preparedness must be intensified. If there is good news, it is that the most vulnerable cities can be the best prepared. Earthquake-prone Tokyo and flood-threatened Amsterdam display strong ability to manage risk. Beyond climate change, potential pandemics and manmade threats like cyber attack, market meltdown, and terrorism, all demand that cities heighten awareness, strategic and technological acumen, good governance, adaptability, and, perhaps most important, the commitment of institutions and the community to work together as one unit.
Disaster exposure is enormous.
Powerful cities like New York, Beijing, San Francisco, Paris, Los Angeles, Shanghai, and São Paulo fall in the middle or lower ranks of our triple measure of urban resilience—natural disaster exposure, natural disaster preparedness, and security and disease risk. All are significant world centers of economics, communications, technology, and population where major disaster can cripple the city economy, cause human loss and send ripples far beyond. For instance, New York and Los Angeles have over $90 billion in annual GDP at risk.
Lack of affordable housing could hold back cities.
While housing quality exhibits a strong relationship with success, cities with the greatest economic strength today often have housing that is priced out of reach. Five of our top 10 cities in economic clout fall in the bottom half of rent affordability (London, New York, San Francisco, Beijing, and Shanghai). This foreshadows difficulty in talent attraction, retention, and, ultimately, cities possessing critical, hands-on skills they need.
Income distribution presents an issue.
Cities should be aware of the potential social and political impacts of polarized income distribution, and try to build and sustain resilient economies that include the wide range of occupations and salary levels that make cities run. While average, absolute income and number of middle-class households are projected to rise across our cities, they also show widely differing income distributions. For instance, US cities are among the top 10 with household income distributions earning less than 50% of median income.
Cities are the future.
They are not only where people are moving but where young people are moving. The healthiest cities are likely to win the global competition for talent and growth.
...But they also face demographic tests.
Aging, slowing birth rates, and migration will realign public and private demands. Almost half of the increase in our cities’ population by 2030 will be in those over 65 years old. Demographics challenge the growth and the finances of many cities with increasing pension, healthcare, and other service costs. Businesses gain opportunities to develop new services and products to respond to the changing pattern. Both the public and private sectors benefit if the city’s quality of life attracts the talent needed to build the future.
Leading cities put together concerted strategies.
Understanding their own strengths, weaknesses, and identities helps cities orchestrate growth to suit their own profile. Because cities are complex systems of systems—economic, demographic, technological, infrastructural, governance, social, and cultural—leadership will build from local identity, not formulas.
Businesses and governments share in city wellbeing.
Successful cites align the private and public sectors into a potent force for shared prosperity. Public and private sectors both depend on healthy urban economies for success. They need to work together actively to help shape operating environments in a world where a continued urban renaissance is not guaranteed. The market will not necessarily resolve all issues cities face. Economic pictures can change fast. And governments often face tight resources.