Capital cities are typically the biggest cities in their countries. As a result, they often provide the most jobs to the national economy. However, it is important to look beyond this basic metric as a measure of whether capital cities are better for jobs.
To do this, one needs to look at the types of jobs available in capital cities. The health of the financial sector is naturally held up as a reflection of how well the economy is doing, so it makes sense to look at financial jobs.
A Financial Centre?
With most countries, it is certainly the case that the capital city is seen as the financial centre. However, it is important to note that this isn’t always the case, and that when it is it can actually have negative connotations.
You could look at London as the perfect example. The financial sector in the city is bustling with investment and wealth managers like ACPI, but the rest of the UK simply looks on, often in envy and anger, at how it performs. The bigger English cities like Birmingham and Manchester can’t touch London, while even the other UK capitals Cardiff, Edinburgh, and Belfast have very little to show in terms of financial strength.
Countries where the capital city isn’t the main financial centre include the United States, where New York City is the obvious financial and economic centre, although the country is so big that many cities are considered financially important.
China, behind the United States as the world’s second largest economy, also has financial centres away from the capital, with Shanghai being more renowned than Beijing.
What Makes Capitals Special?
People naturally gravitate to capital cities purely because of their status. Although the rise of bigger cities and metropolitan areas around the world means that capital cities are increasingly being rivalled – look at Canberra, Australia, which is only the eighth largest city in the country – by others, capitals in general still have a gravitas and importance, whether this is as the main tourist destination or travel hub.
As such, they are often the place where people will look for work, and ambitious individuals interested in the finance industry are likely to be found travelling to capital cities.
Are They the Best?
The answer really depends on the dynamic of the country. If you are a finance professional based in London, then clearly the dynamic of the UK makes it the best place for you to be earning your living.
By contrast, if you were looking at moving to China or Australia, you’d want to look elsewhere, as China has a number of financial powerhouse cities while the financial industry in Canberra is nowhere near what it is in the other Australian cities, and specifically in Sydney, the financial centre of the country.
At the same time, leading finance companies will have operations in a number of cities, so if you wanted to work in a quieter city location there is nothing to stop you from finding a job with a leading finance company and then moving to a smaller office in a place more to your tastes.
Jason Roberts works for a financial company in a small city having started out working in London. While he understands financial centres are often capitals, he also realises the importance that smaller cities have in supporting the industry.