Cities Economic Outlook 2026

This report examines the changing economic, demographic, and spatial dynamics of South African cities using the Spatial Tax Panel (PDF, 11.05MB), a comprehensive administrative dataset on formal employment and business activity. The report finds that although metropolitan areas remain the country's key economic centres and have absorbed much of South Africa’s population growth, their economic performance has weakened over the past decade, with job creation lagging behind other parts of the country except for Cape Town and Tshwane. It highlights challenges such as deindustrialisation, rapid urbanisation, spatial inequality, housing and infrastructure pressures, weak labour market access, and the uneven impacts of climate and green transitions. At the same time, the report identifies opportunities for renewal through stronger city governance, strategic urban investment, economic complexity and diversification, improved transport and housing integration, support for green jobs, and the use of evidence-based policymaking to strengthen the resilience, inclusiveness, and productivity of South African cities.

Abstract based on original source.