The most influential Megatrends set to shape the world through 2030, identified by Euromonitor International, help businesses better anticipate market developments and lead change for their industries.Learn More
Following rapid global urbanisation and the growing role of knowledge-intensive economic activities, most of the world’s economic and employment growth is concentrated in major cities. In particular, over 2010-2015, some of the most rapid rates of employment growth were registered in cities in developing and emerging markets, primarily located in the Middle East. During the six review years, the most successful cities were investing in the public services sector, supporting the development of high value-added services and managing to attract substantial flows of FDI. However, it is likely that the nearest future will see some shifts in rankings, as the slump in oil prices will bring down the fortunes of and abundant government investment in some key cities in the Middle East.
In Africa and the Middle East, Doha was the stand-out city, with much of the city’s growth being attributed to the expansion its public services sector. According to the Middle Eastern recruitment consultants GulfTalent, healthcare is the fastest growing industry in Qatar, due to the rapidly growing population, greater government investment and regulatory changes requiring employees to be covered by health insurance. Employment growth in the Israeli cities of Jerusalem and Tel Aviv were similarly dominated by the expansion of the public services sector, influenced by their rapidly rising populations.
The growth of business services activities, which encapsulate financial intermediation, real estate, renting and business activities, was the main factor instigating employment growth in Istanbul and Kuala Lumpur. The Turkish government has set a vision of making Istanbul a major financial centre, on a par with key global players New York and London, and this is due to be given a major boost by the anticipated completion of the Istanbul Financial Centre (IFC) by the end of 2016. It will be home to the country’s Central Bank (currently located in Ankara), as well as various other state financial institutions. In South East Asia, the city state of Singapore is generally proclaimed as the financial capital of the region, yet Kuala Lumpur is striving to bridge this gap and emerge as a leading city in the region for Islamic finance.
Nairobi and Tianjin benefit from strong FDI flows. In a 2016 report by investment analysts FDI Markets, Nairobi was ranked as the best African city for FDI in 2015, thanks to its rapidly growing entrepreneurial consumer base, influenced by the digital revolution. As for Tianjin, FDI from Hong Kong and Taiwan was behind the city’s dramatic economic growth, channelled in particular towards high-end manufacturing activity.
Other key cities that record high growth in employment include Douala and Riyadh. Douala is a centre for commercial activity, and one of the largest ports on the Atlantic coast of the African continent, handling 95% of the country’s imports and exports. Commercial and construction activity dominated the growth in employment in Riyadh. The city is quickly urbanising, with a plethora of malls, residential apartments and skyscrapers, as the city aims to diversify its economy away from its oil and natural gas industry.
As the price of oil hit a 13-year low of US$27 per barrel in January 2016, it is likely that job growth will slow down in some of the best performing cities in the Middle East. In addition, as Chinese exports turned downwards in 2015, the Chinese megacities will also see their job markets running out of steam.
The changing global economic landscape implies that the current top 10 cities with the fastest growing employment will not look the same a couple of years from now. India has posted strong economic growth in 2015, and the country’s key urban areas concentrated most of the economic gains. One can therefore place bets that some Indian cities will replace the current leading cities from the Middle East. Namely, over 2015-2020 the Indian cities of Delhi and Bangalore are forecast to post the fastest growth, with GDP measured in purchasing power parity terms expanding by as much as 73% and 66%, respectively – the most of any Tier 1 city (126 in total) monitored by Euromonitor International.