Sunday, September 23, 2007

Imperial cities, global cities - a postscript

A week back I ran a post, Imperial cities, global cities at a time of change, discussing demographic change within Europe. This post triggered some comments, including a very thoughtful contribution from Lenny drawing out some of the complexities in population flows.

This post discusses two follow up issues: the varying composition of the flows and the emergence of the modern equivalent of the city state.

Start with the EU.

One of the points that James Button made in the opinion piece that triggered my last post is that migration to to the UK is now, relative to population, greater than that to Australia. I was surprised at this. However, beneath that simple statistic lies a position of great complexity.

The existence of the EU itself facilitates people movement within the expanding community. Some of these movements are relatively short term - students, young people broadening their professional experience, guest workers - in that people intend to return home. Others represent long term migration, like the increasing number of UK people living in France or Spain.

Then we have movement into the EU from around the world, including young Australians seeking broader professional fields. Here patterns vary between countries. To quote Lenny:

The *long-term* foreign-born British workforce therefore, is chiefly drawn from South Asia, the Caribbean and African countries within the Commonwealth.Whereas Germany's long-term foreign-born workforce is chiefly European origin itself. This is both from massive Italian/Greek immigration in earlier decades and due to the carry-over from the Eastern bloc system, which led to enormous long-term Polish/Czech/Slovak/Hungarian settlement in eastern Germany which continues today ...

And yes, Germany's population is ageing, but then so is the UK's. If you separate out the foreign-born components, the native English and German fertility rates are both very below replacement, so both depend heavily on outsiders coming in-- just from very different sources.

Now pretty obviously, if you have natural population growth well below replacement levels and depend upon migration to make up the gap, then the proportion of migrants in the population is likely to rise. Again pretty obviously, to the degree that countries draw migrants from different sources, the ethnic composition of populations is likely to vary over time within countries and between countries.

While I have focused on the EU, we can see the same pattern elsewhere.

The US attracts a varied mix of skilled migrants from around the world. However, the dominant migration issue in the United States is the continuing influx of hispanic people, especially from Mexico. This has begun to change the ethnic mix of the US population.

If we move to a different part of the world, New Zealand's links to the Pacific are clearly changing the ethnic mix of the New Zealand population.

Note that I am not making any comment here as to whether or not this overall process is a good thing, although I think that it is an inevitable thing. I am simply observing.

Now link this to my point on cities.

Cities have always attracted migrants, indeed depended upon them, because until very recently cities were unhealthy places in which to live. This attraction effect continues. One result is a growing divergence between the ethnic and cultural mixes in certain cities and the broader country population.

Auckland is clearly part of New Zealand, yet Auckland's population mix is now very different from that holding in the rest of New Zealand. The same is true of London and, increasingly, Sydney. Here I want to quote Lenny again:

As far as what makes a global city, seems that's mostly a matter of turning the city into an attractive place for talented people (business starters and artistic types) from elsewhere in the world. Paris, Rome, Berlin and other cities do this as much as London does, and there's no reason why smaller-ish cities like Sydney or Frankfurt in Germany couldn't do the same. It's a matter of putting one's own house in order first.

I think that Lenny is right, but only partially right.

All cities draw migrants from particular catchment areas. Auckland , for example, draws from the rest of New Zealand, the Pacific and Asia, Sydney increasingly from Asia. But then cities also draw more broadly, attracting people with particular interests and skills from around the world.

Success in this second class is determined by the city's global reach. Yes, the pull of individual cities does depend upon cultural and life style factors drawing what have been called the creative classes. But it depends even more on global reach.

To illustrate, look at Australia.

Each state capital grew because it was the governing centre and entrepot for its particular territory. Melbourne used to top the Australian city hierarchy and did so for many years because of its control over manufacturing, finance, mining.

In those days there were two Australian economies. There was the domestic economy sheltering behind its tariff walls and exchange control restictions and then there was the export sector based on primary production. Melbourne's focus was always domestic, based on its control over the sheltered domestic economy.

As the economy opened up, Sydney gained at the expense of Melbourne and indeed all the other capital cities. The reasons for this were both cultural and locational. For a period, the trend to Sydney dominance seemed irreversible.

Now things have changed again. Melbourne has been through an adjustment process, in so doing reinventing itself in life style terms. Both Brisbane and Perth have grown significantly because of natural resources, in so doing attracting people from Sydney. If you look at the latest salary data for lawyers, for example, you can see that Sydney still leads, but the gap has been narrowing.

One thing that I find intensely interesting in all this is just what it means for the future of Sydney, for of all the Australian cities Sydney is the one whose future is most dependent upon its global reach. If this fails, Sydney as a city is likely to decline.

Sydney still draws part of its wealth from its control of NSW, part from its influence over the broader Australian economy. Both have been in relative decline. Increasingly, Sydney's wealth depends upon global services, trade and finance. Sydney is Australia's economic city state.

Because Australia has done far better in economic terms than once might have been expected, so Sydney has been able to grow, leveraging from the growing domestic economic base. In particular, our currency and financial markets have increased in global importance in ways many of us, including me, did not forsee.

Can this continue? I simply do not know. My best guess at the moment would be that city state Sydney - global Sydney as it is often called - is in a degree of trouble.

Sydney is caught in a three way squeeze. Its domestical rivals - Perth, Brisbane, Melbourne - are nibbling away at its position. The city's costs have been rising, it's life style in some ways in decline. Globally, the city faces increasing competition.

To me, and I accept that I am biased because I do not like living in Sydney, there is a degree of complacency in the city. The city has been a big fish in a small pool for decades and behaves like that.

Does this matter? After all, given my biases I would hardly weep tears over any decline in Sydney.

Despite this, I think that it does matter. In a world of global economic city states, we actually need Sydney to maintain its position to compliment the other things that we have.

No comments: