Dive Brief:
- New York City retained the top spot in an annual Global Cities Index from global management consulting firm A.T. Kearney that measures current city performance, but the report says there is the "potential of a transformative shift." London, Paris, Tokyo and Hong Kong rounded out the top five.
- A separate forward-looking "outlook" report, which examines future potential of cities, drops New York out of the top 10, owing to negative trends in livability, entrepreneurship, private investment and the ease of doing business.
- London, Singapore and San Francisco are the top cities in the outlook rankings. The annual report measures how competitive cities are in areas including business activity, culture, political engagement, information exchange and human capital.
Dive Insight:
New York City continued its three-year stretch atop the A.T. Kearney rankings because it ranks highly in business activity, human capital and the arts, and was credited for its ability to attract international talent.
However, analysts say that there is shuffling lower down on the list, as cities attract new business and human resources. Sydney, Australia rose to 11th, in part because of a more educated population and open media. Houston rose 14 spots to No. 35, because it is attracting global firms. The city has made tech innovation a priority.
Human capital emerged as a major factor for rising cities. Municipal policies, cultural amenities and a more diverse population helped cities rise. That was also a key reason San Francisco fell from its top spot in the outlook rankings. A.T. Kearney said although the city remains an innovation hub, it is being passed by other cities in areas like personal well-being and governance. Rising housing prices and conflict with the tech industry likely also contributes.
Among American cities, Los Angeles, Chicago and Washington, DC made the top 10, with Boston rising to No. 21. Looking forward, however, the firm found that Asian and Middle Eastern cities appear to be closing the gap on North American ones, in part because of improvements in governance and regulatory environments.
