09.03.2023Future Economy: The Melbourne Summit breakout session

Committee for Melbourne, with partner JLL, assembled business, academic, not-for-profit and government leaders to discuss the city’s future at The Melbourne Summit on 2 March.

Designed to generate ideas to make Melbourne a better city to live, work, play and invest, discussion was aided by the release of the Benchmarking Melbourne 2023 report, which measures Melbourne’s performance against 19 global peer cities.

Future Economy – one of three pillars in the report – considers the key building blocks of the metropolitan economy, including skills and talent, global reach and resilience, and leading edge innovation.

Skills and Talent:

As the lifeblood of the urban economy, highly skilled and capable people are needed for a city to prosper and grow. In this category, Melbourne has performed moderately well, ranking 9th of 20 peer cities.

Confidence in Melbourne’s universities and tertiary institutions to produce skilled graduates is relatively high. We rank 22nd out of 50 global cities for the biggest AI talent pool and 15th out of 50 cities for the number of data scientists and analytics jobs available.

Melbourne does well to retain its graduates, having the fourth highest retention rate of top graduates among its 19 peer cities. This is aided by our city’s domestic importance and distance from competitors.

But net out-migration has been high in Melbourne since the start of the pandemic, with the share of people aged 20 to 39 leaving the city higher than most peer cities. Effort is needed to ensure Melbourne remains an attractive destination for top local and foreign talent.

Global Reach and Resilience:

A city’s openness to trade, business and talent, and its ability to adapt to changing economic and geopolitical conditions, is vital in an increasingly complex world. Again, Melbourne is performing moderately well, ranking 11th of 20 peers.

The city remains an attractive destination for global markets and businesses, placing 11th globally for attracting foreign direct investment in regional headquarters over the past two decades – higher than Madrid and Beijing.

Melbourne is nestled in the top 40 cities globally for cross-border real estate investment and there is great momentum in logistics, with total take-up in the sector over three times higher here than our peer cities.

But vigilance is needed. The system-wide disruptions on workforce, location choices, visitor demand, and trade during the pandemic are to fully play out.

Leading Edge Innovation:

Modern, ambitious cities need robust innovation ecosystems to help deliver new and better services, support job creation and to help grow the economy. Melbourne ranks 15th of 20 peer cities in this category.

Despite the modest ranking, there is cause for optimism. Melbourne’s life science clusters are globally renowned, the city has emerged as an aspiring hub for energy and environment innovation, ranking 4th globally for the success of energy and environmental start-ups at achieving real scale, and we rank 7th among 18 peers for the share of our start-ups and scale-ups that use ‘frontier technologies’.

While the outlook in this category is stable, forging a decisive position in leading-edge innovation is a critical next step for Melbourne to remain a city of international significance.

The Future Economy Breakout Room at The Melbourne Summit discussed the key insights from the Benchmarking report and highlighted some areas of focus in relation to future economy. The discussion – proudly supported by PwC Australia – featured its Chief Economist, Amy Auster, who opened with a presentation focussing on the performance of the local economy, as well as key macro-economic trends impacting and shaping the future economy.

Amy was joined by four local leaders in Committee board member and MedCorp Technologies founder, Jacqueline Savage, Future Leadership Managing Director, Michelle Loader, NBN Co’s Executive General Manager for Customer Experience and Products, Joe Lathan, and LaunchVic CEO, Dr Kate Cornick. Moderated by the Committee’s Director of Engagement, Mark Sinclair, key issues raised included:

• Workforce management and cyber security are arguably the two biggest issues facing Australian-based CEOs.
• Developing capabilities, including behaviours and mindsets, is arguably equally as important as skills development.
• Opportunities to increase the repatriation rate of more than one million Australians currently working overseas.
• Support required from all Australian governments towards strategic densification of key precincts to address the housing crisis and develop agglomeration advantages.
• Opportunities for more Australian-based CEOs to focus on supply chain risks and to onshore more activities.
• Advancements in decarbonisation activities, with Australian business being ahead of many global counterparts for decarbonisation measures, perhaps driven by exposure to recent extreme weather events.
• Commercialisation of research is a significant challenge, with not enough local, skilled practitioners capable of taking products to market.

Despite the challenges and opportunities outlined, all panellists were optimistic in Melbourne’s long-term future. This perception is backed up by Benchmarking Melbourne 2023, with various metrics indicating that there remains faith in the city’s long-term economic fundamentals.

We look forward to working with our members and stakeholders on progressing our work under the Future Economy pillar, with a focus on opportunities for further commercialisation of innovation and scaling up of technology and businesses.

This breakout room was supported by presenting partner PwC.

For further information on Committee for Melbourne’s policy agenda, contact Director of Policy and Advocacy, Leanne Edwards at ledwards@melbourne.org.au or Senior Policy and Advocacy Officer, Brett Van Duppen at bvanduppen@melbourne.org.au.

Read the other breakout session summaries here: Infrastructure and Sustainability or Liveability and Urban Optimisation