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Four economic problems Sydney needs to overcome

Home to over 5 million people as well as global corporations, international students and workers and an unending flow of tourists, Sydney has earned its recognition on the world stage.

But while Sydney continues to attract business and investment, its identity and performance have shifted; the success has not been without consequence as the major city learns to deal with its own growth.

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These are the key challenges that Sydney needs to address, according to a recent report by Committee for Sydney.

1. Becoming more liveable for its own residents

“There are many signs that Sydney’s inherited liveability equation is changing. Relative to other cities, employee life satisfaction has fallen from its very high level,” the report said.

Against metrics that measure everyday experience and factors such as amenities, vibrancy and quality of place, Sydney has “slightly los[t] its position” compared to other global cities. Additionally, housing affordability was declining, creating a domino effect for metrics of Sydney’s social fairness and cohesion.

“Sydney’s liveability model is also questioned by benchmarks of culture which suggest that the city has been relying on an ‘events and bed-nights’ based cultural economy (consumption) more than one driven by creativity, cutting edge art, place-making, and optimising the culture eco-system.”

“Culture in Sydney is oriented more towards the visitor economy than resident quality of life.”

2. Living up to its own name

In terms of visitor brand and real estate, Sydney remains competitive compared to global peers – but has dropped its game in terms of the quality of visitor experience as other cities invest in tourism overflow management, storytelling and local amenties.

Furthermore, Sydney trails other cities such as Amsterdam and Shanghai in being a hub of diplomacy and influence.

“These cities are making important efforts in this space to attract institutions, cluster global NGOs, host gatherings of influencers and to establish their distinctive contribution to the world, reflecting their confident metropolitan identity.

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“These studies suggest that Sydney’s brand identity is compelling but incomplete as it does not yet include a clear cultural and business story to the world.”

3. Travelling too slowly

Sydney’s public transport problems are known all too well to its residents. According to the report, the major city is currently “at a low point in the cycle” as it shifts to a new metropolitan transport system and struggles with updating its digital infrastructure such as WiFi speed.

Compared with other cities that have made major investments in this area, it may take some time for the perception of Sydney to catch up in these aspects.

“Sydney’s infrastructure deficits are not well known by global public opinion and are not reflected in more general surveys of cities,” the report said.

“This is a short-term reputational advantage, but it could become a risk in the future if greater progress is not sustained.”

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4. Bridging the talent gap

According to the report, Sydney doesn’t make it in the top 20 global innovation hubs – and the distance between university performance and innovation performance is “notably high”.

“Attracting large numbers of international students to prestigious institutions is clearly an important growth dimension of Sydney’s economy.

“But there is a potential risk that ‘exporting degrees’ to high numbers of international students is prioritised at the expense of hosting an advanced innovation economy that promotes invention and discovery, leverages cutting edge knowledge, and generates enterprise growth.

Also read: The five factors shaping the workforce of the future

Although talent attraction is high, Sydney needs to overcome the obstacle of retaining talent, the report pointed out.

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