New rankings of world’s metro economies reflect West-to-East shift

Shanghai was at the top and Sacramento near the bottom of new rankings of the world’s best- and worst-performing metropolitan economies last year by the Brookings Institution.

The rankings of the 200 largest metro areas that account for nearly half of the entire global economy underscore how the Great Recession has accelerated the shift in economic strength from the West to the East, and from industrialized countries to developing nations in Asia and South America.

In Brookings’ list, released Wednesday, 90% of the world’s fastest-growing economies were outside North America and Western Europe. And 95% of the weakest-performing metro areas were in the long-dominant economic powers of the U.S., Western Europe and Japan.

Only one American city made the top 20: Houston, which came in at No. 19, a notch above Kuala Lumpur, Malaysia.


“Now what’s happening in Shanghai, Beijing and Chongqing are more and more important for the global economy,” said Alan Berube, senior fellow at the Washington think tank, who co-wrote the study based on data from Oxford Economics, Moody’s Analytics and the Census Bureau.

Although the report makes no projections for future growth, Berube said the findings suggest U.S. cities that are best positioned to take advantage of the global economy will outperform other areas.

The basis for Shanghai’s No. 1 ranking was employment growth of 5.8% and a metro economy expanding 9.8% from 2010 to 2011.

In contrast, Sacramento had America’s worst ranking, a lowly No. 196. Brookings said the area was in “full recession” last year with both employment and the region’s equivalent of gross domestic product down about 1%.

After Shanghai, the next two leading economic performers were both in Saudi Arabia — Riyadh and Jeddah, followed by Izmir, Turkey. Overall, China accounted for eight of the top 20 cities in the rankings.

The greater Los Angeles area, including Orange County, was in the bottom half at No. 146, reflecting the region’s weak recovery. The Inland Empire area of Riverside and San Bernardino counties was a bit lower, at 170, but San Diego came in higher, at 125.

California’s highest-ranking metro area was San Jose, No. 61, thanks to a resurgence in the Silicon Valley and the region’s manufacturing industry.

Manufacturing’s strength, in fact, lifted the rankings of other long-depressed cities — notably Detroit (No. 72) and Buffalo (No. 68).


Stuttgart, Germany, that nation’s manufacturing hub and home to Mercedes-Benz, was the leading Western European city on the Brookings’ list, at No. 31. Tokyo, hard hit by the earthquake-tsunami last year, lagged at No. 151.

And at the very bottom, reflecting Europe’s continuing debt woes: Athens.