Cities have long been punted in economic development literature as engines of economic growth and development, which is why over the ages people have migrated from rural to urban areas. However, this role of cities is not automatic, as a recent report on South African cities argues.
It suggests the quality of governance in the big cities has a bearing on whether metros become engines of growth and development. It decries the “lack of a political champion for cities, or any kind of vision for cities at the heart of government” as unhelpful and unfortunate.
This is a situation that is likely to continue, given that polls and electoral forecasts ahead of the forthcoming municipal elections point to an increased number of coalitions forming governments. Such an outcome could pull metros more towards short-term deal-making, the very antithesis of economic development.
Economic development and growth that are sustained over long periods of time require great political leadership and good governance. This is because economic development isn’t a linear process — it has its ups and downs.
Citizens must therefore be convinced that development’s future rewards are worth the effort, patience (forgoing today’s benefits for a promised better life tomorrow) and the economic uncertainty that development entails.
The short-termism of coalition politics, especially when combined with looting and corruption, undermines these foundations of development.
The report Cities Economic Outlook 2026, Cities in Flux: Pathways of Stress, Adjustment & Renewal says South African metropolitan areas have historically outperformed the rest of the country economically. They had stronger job growth, higher value jobs and higher average incomes.
“They have made a disproportionate contribution to the prosperity of their regions (provinces) and to the country as a whole. This is why they are much larger settlements and are generally more prosperous than smaller cities, towns and rural areas.
“This is consistent with the pattern of urbanisation found almost everywhere else in the world,” write economists Ivan Turok and Justin Visagie in chapter two of the report (Metropolitan Crisis? Tracking a decade of jobs and structural change).
However, over the past decade the trajectory of employment in the metros, bar Cape Town and Tshwane, has lost momentum, lagging the rest of the country. This is a significant deviation from the historic trend in which metros outpaced towns and rural areas.
Cape Town continues to be run by one party and Tshwane has been cushioned by the fact that it is the administrative seat of national government, making most of its jobs more secure than private sector jobs.
The jobs trajectory contradicts the conventional wisdom that ‘big cities are natural economic powerhouses, and the assumption that their prosperity can be taken for granted in the way public resources are distributed across municipalities and provinces through the equitable share’.
The jobs trajectory contradicts the conventional wisdom that “big cities are natural economic powerhouses, and the assumption that their prosperity can be taken for granted in the way public resources are distributed across municipalities and provinces through the equitable share”.
After pulling ahead of the rest of the country, especially between 2014 and 2017, metros have since lost the job creation advantage accumulated in the mid-2010s. This relative decline of the metros, says the report, coincided with the formation of coalition governments in four of the eight metros (Johannesburg, Ekurhuleni, Tshwane and Nelson Mandela Bay).
Metros were also hit hardest by the economic lockdowns during the Covid-19 pandemic and have not fully recovered.
Though Turok and Visagie caution that their findings reflect relative rather than absolute employment decline, they warn the gradual weakening of metros must be taken seriously by government and other stakeholders.
• Sikhakhane, a former spokesperson for the finance minister, National Treasury and South African Reserve Bank, is editor of The Conversation Africa. He writes in his personal capacity.
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