The significance of cities for jobs

Introduction

South African cities occupy a tiny fraction of the country's land area, yet they make up the lion’s share of the economy. This map of the month – produced by researchers at the Human Sciences Research Council and the University of the Free State – explores different ways of depicting the concentration of formal employment in cities.

Choropleth map of formal employment per municipality

Figure 1 is a conventional way of showing the distribution of formal jobs across the country. The spatial units are municipalities. Different coloured shading is used to portray different levels of employment in each area. The information on jobs is based on a new dataset derived from SARS tax data (Note: you can learn more about the economic geography of the country from tax data here: www.spatialtaxdata.org.za). These are formal jobs in the 2021/22 tax year based on full-time equivalents (i.e. adding together all available work opportunities (part-time and full-time) and converting them into the total number of full-time jobs).

Figure 1: Choropleth map of formal employment per municipality. Source: Spatial Tax Panel, see www.spatialtaxdata.org.za.

The map shows that most parts of the country have relatively few formal jobs. Those municipalities with the lightest shade of blue have up to 7000 jobs each. They are all rural areas and most of them have large physical footprints or territories.

The map also shows a handful of places that have lots of jobs – shaded dark purple. These are all metropolitan municipalities and the five with the most jobs are Johannesburg, Cape Town, Tshwane, eThekwini and Ekurhuleni. Together they account for almost 60% of total formal employment in the country. Cape Town and Johannesburg have the darkest shade indicating that they have from 1 380 000 to 2 017 000 jobs each.

It could be argued that Figure 1 does not adequately capture the economic significance of large cities because they cover such a small proportion of the country’s land area. The eight metros account for less than 3% of South Africa’s land area but more than 65% of all jobs. Repeated use of this kind of map could mean that the metros receive less attention from decision-makers than they deserve or require.

Cartogram of formal employment per municipality

Figure 2 is another way of portraying the same information that turns perceptions on their head. The spatial units in this cartogram are still municipalities, but their size reflects their share of employment rather than their physical area.

Figure 2: Cartogram of formal employment between municipalities. Source: Spatial Tax Panel, see www.spatialtaxdata.org.za.

The economic importance of the metros is immediately apparent since they are so much bigger than all other areas. This kind of map could serve a useful purpose in altering perceptions and shifting mindsets to recognise the distinctive contribution of the large metros to jobs, output and tax revenues in South Africa.

Employment to population ratios

The employment situation in the metros is also more favourable than the rest of the country when considering their population base (Figure 3). A higher employment-to-population ratio is associated with many social and economic benefits, including better human development outcomes, higher consumer spending, more taxes and less pressure on social services.

Figure 3: Employment-to-population by settlement type (formal jobs). Source: Spatial Tax Panel, see www.spatialtaxdata.org.za.

The ratio of jobs to population increases in line with settlement size, moving from sparse opportunities in rural municipalities to the highest concentration of jobs in the metros. The contrast is striking. There are only five formal jobs supporting every 100 people in rural areas, compared to 18 in secondary cities, and 31 in the metros.

It is well documented that rural areas, particularly the former homelands, have the highest and most persistent levels of poverty and reliance on social grants in the country.

South Africa is very similar to other countries in that employment is concentrated in big cities. This is because businesses derive enormous advantages from being located close to their customers, suppliers and workers. They also benefit from the public infrastructure, services and facilities available in cities. Although it is sometimes argued that jobs should be moved to towns and rural areas, this would undermine the viability and competitiveness of many of these businesses.

South African cities are places of unusual economic possibilities and entrepreneurial potential. Metros deserve special treatment from all spheres of government and all sectors of society. They provide many more pathways out of poverty for citizens, and opportunities to improve living standards for people across the whole income spectrum.

By redrawing maps in this manner, one may be able to shift public perceptions and raise the profile of cities in ways that encourage decision-makers to take them more seriously.

Edits and input: Graeme Götz, Richard Ballard, Yashena Naidoo.

Map design: Jennifer Murray.

Suggested citation: Visagie, J., Turok, I. (2024). The significance of cities for jobs. Map of the Month. Gauteng City-Region Observatory. March 2024. https://doi.org/10.36634/AIIH4878