2015/10/ Economic trends & the productive city WELL-GOVERNED CITY Key issue: Is the political & institutional context stable, open and dynamic enough to accommodate all interests CITY POPULATION Key issue: What will be the future size, form and character of urban populations, given the commitment that residents have to lives in the city? INCLUSIVE CITY Key issue: Do residents have the opportunities and capacities to share equitably in the social benefits of city life? SUSTAINABLE CITY Key issue: How is the city impacting on the envelope of natural resources that sustains the settlement and makes it livable? PRODUCTIVE CITY Key issue: Can the local economy provide a majority of residents with means to earn a reasonable living?

2015/10/ Economic trends & the productive city Population growth and economic growth are closely linked If cities cannot provide populations with opportunities to use their productive capacity, and be adequately remunerated for this, they may disinvest Key issues examined in report: Economic value growth in cities and key sectors Employment & unemployment Distribution of income Key micro-economic factors impacting econ development Prospects for city economic development strategies

2015/10/ Economic trends & the productive city GVA growth averaged 2,2% across 9 cities between And in some cities very strong growth But GVA per capita growth did not keep pace Fastest growing for was Tshwane. Continued in Some cities seeing recent slowdowns? Others (eg Msunduzi) a turnaround? JoburgeThekwni Cape Town Ekurhu- leni Tshwane Nelson Mandela Buffalo City MangungMsunduzi

2015/10/ Economic trends & the productive city annual growth rates per sector shows differences across a sample of cities, although some, such as transport, storage and comms, uniformally strong TSHWANE CAPE TOWN NELSON MANDELA MSUNDUZI TOTAL CITY5.02% 1.65% 2.19%3.07% 1 Agriculture, hunting, forestry, fish3.78% 4.00% 3.94%3.22% 2 Mining and quarrying-5.83% -8.49% %-16.18% 3 Manufacturing5.29% 1.59% 1.32%3.09% 4 Electricity, gas and water supply2.43% 3.37% -0.82%1.00% 5 Construction3.59% -1.00% 0.24%1.85% 6 Wholesale and retail trade4.65% -0.03% 3.20%3.76% 7 Transport, storage and comms10.22% 4.58% 5.52%6.56% 8 Finance, insurance, real estate & bus5.69% 2.03% 2.64%4.24% 9 Community, social and personal1.11%

2015/10/ Economic trends & the productive city annual sub-sector growth rates within manufacturing also show key differences EKURHULENIETHEKWNIMANGAUNG BUFFALO CITY MANUFACTURING3.31%4.43%-2.76%-3.46% 30 Food, beverages and tobacco products-4.85%-2.48%-8.61%-9.83% 31 Textiles, clothing and leather goods6.20%7.52%1.92%1.32% 32 Wood paper and printing4.02%5.15%-1.22%-2.69% 33 Fuel, petroleum, chemical and rubber4.72%7.45%0.75%-0.73% 34 Other non-metallic mineral products2.98%4.34%-2.19%-2.60% 35 Metal products, machinery, appliances5.86%7.97%1.30%1.34% 36 Electrical machinery and apparatus1.27%4.02%-2.78%-3.89% 37 Electronic, sound/vision, medical & other4.89%7.17%0.15%-1.15% 38 Transport equipment0.29%1.87%-4.31%-5.69% 39 Furniture and other items NEC & recycling3.74%6.53%-0.57%-2.09%

2015/10/ Economic trends & the productive city Census data shows SA as a whole created a net new jobs in More than half of these – – were formed in the nine SACN cities. But … Unemployed also grew LFS shows expanded unemployment 35,72%

2015/10/ Economic trends & the productive city The strength of the local economies of the nine SACN cities needs to be seen in a long term perspective of economic restructuring Long term decline in manufacturing employment, especially in key centres Long term growth in employment in the finance / business sector

2015/10/ Economic trends & the productive city However some surprising recent turnarounds Cities with a long term fall in manufacturing employment saw growth in this sector in Note especially the recent growth of manufacturing jobs in Johannesburg and Ekurhuleni

2015/10/ Economic trends & the productive city Jobs growth/decline in occupations follows trends in key sectors. Worrying falls in professionals and pvt household employees

2015/10/ Economic trends & the productive city GVA growth does not lead to the same increase in emplyment in all sectors GVA growth Employ growth Total city Agriculture, hunting, forestry, fish Mining and quarrying Manufacturing Electricity, gas and water supply Construction Wholesale and retail trade Transport, storage and comms Finance, insurance, real estate & bus Community, social and personal

2015/10/ Economic trends & the productive city Incomes earned from employment still reflect the very serious racial imbalances of apartheid Larger numbers of black income earners earning near the lower income brackets Total earning power clearly skewed towards white earners

2015/10/ Economic trends & the productive city In some cities unemployment is so high, and average monthly income so low, relative to other parts of country, that it does not make economic sense to remain there Average Monthly Income per employed person AMI: 2001 Difference in AMI for each city and National AMI: 2001 TshwaneR R EthekwiniR R Buff CityR R TotalR R

2015/10/ Economic trends & the productive city Various reasons for economic strength/weakness and strategies to address The key reason for economic weakness is insufficient demand & inadequate use of productive capacity. But also micro-economic constraints

2015/10/ Economic trends & the productive city Some cities see global demand as answer & have set out to promote exports by addressing constraints on micro-economic competitiveness. As part of this are trying to address institutional inefficiencies, skills gap, etc Very NB that traditional LED not only focus. But will global economy provide stable & sustainable demand? JoburgeThekwEkurhul Total number of applications in 2002/ Av processing time (in days) minor building works545 Av processing time (in days) for dwellings Av processing time (in days) for industrial / comm273835

2015/10/ Economic trends & the productive city WELL-GOVERNED CITY Key issue: Is the political & institutional context stable, open and dynamic enough to accommodate all interests CITY POPULATION Key issue: What will be the future size, form and character of urban populations, given the commitment that residents have to lives in the city? INCLUSIVE CITY Key issue: Do residents have the opportunities and capacities to share equitably in the social benefits of city life? SUSTAINABLE CITY Key issue: How is the city impacting on the envelope of natural resources that sustains the settlement and makes it livable? PRODUCTIVE CITY Key issue: Can the local economy provide a majority of residents with means to earn a reasonable living?