By Wilhelm Crous
July 11, 2022
Given how global talent has become, cities are increasingly being viewed as talent magnets.
Unfortunately, South African cities have been in the news for all the wrong reasons recently. Gqeberha is running dry, Cape Town and Johannesburg have extraordinarily high murder rates, Durban has been devastated by severe flooding and criticised for its slow response, and no South African city was named on the recent Economist list of 200 most liveable cities.
That type of news and the resulting bad image will make it difficult for South African cities to attract and retain talent. In addition, investors would rather invest in cities with abundant talent or where it will be easy to attract talent.
The Global Cities Talent Competitiveness Index (GCTCI) provides a fundamental set of criteria for policymakers to position their cities in order to attract and retain talent. The GCTCI is a part of the annual Global Talent Competitiveness Index (GCCI), which is compiled by Insead. The latest report (2021) analysed 155 cities from 55 countries around the world, including Cape Town and Johannesburg. The top 10 cities in the world were listed as: San Francisco, Geneva, Boston, Zurich, Luxembourg, Dublin, Singapore, Seattle, London and Helsinki. Cape Town was the highest ranked in Africa at 116th, while Johannesburg only featured in the bottom quartile at 123rd. As can be expected, there is high correlation between a country’s ranking and the cities in that country.
Before I compare Cape Town and Johannesburg in depth with a list of selected cities, I would like to briefly describe how the GCTCI is compiled. Firstly, the Index defines a city as the core city and its surrounding community zone, which results in an urban area that is an integrated labour market. The Index is based on five pillars and 16 variables (see below).
The variables are compiled from the data indicated in the table below:
Cape Town and Johannesburg’s positions are compared with a number of selected cities in countries that are popular for top talent from South Africa to emigrate to. I have also included Lagos and Accra in Africa for comparison.
Both Cape Town and Johannesburg will have to be very intentional in addressing their scores on the Index if they want to attract, and more importantly retain, talent. Some of the issues that need urgent attention include internet speed, ease of doing business and safety. If these issues are not resolved, foreign direct investment will not increase, which is necessary to improve GDP per capita and job creation.
Over time, both cities need to increase their tertiary enrolment numbers, as well as aspects around happiness, innovation and creativity, which will lead to more patents being registered. Stronger and more efficient links between the public and private sectors with academia will also improve innovation.
It is interesting that the Index includes “foreign born population as a % of the total city population”, i.e., diversity is highly valued. In this aspect, Johannesburg and Cape Town are also not doing well.
The GCTCI report states that mayors are shifting their focus from attracting firms to attracting residents, and thus the property and consumption taxes they bring, by improving quality of life. This means more green spaces and recreational facilities, greater connectivity (including 5G), as well as higher internet speeds.
To improve, our policymakers will first have to acknowledge that their cities should become stronger talent magnets, following which they will need to develop an integrated strategy to reposition them. Certain indicators/variables will obviously have to be prioritised, such as safety, independent power supply, internet speed and the cost of data. Thereafter, the larger issues can be addressed. If these steps are not taken, South Africa will continue to be an exporter of talent and international organisations will continue to “hunt” for high level and specialist talent in cities such as Johannesburg, Cape Town and Durban. In the meantime, organisations will have to be at the top of their talent game in order to attract, develop and retain their talent.
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Lanvin , B., & Monteiro, F. (2021). The Global Talent Competitiveness Index 2021: Talent. France: INSEAD, Portulans Institute, and Accenture.