Melbourne and Sydney Crack Global Top 10
Australia’s cities have made an impressive impact in the Oxford Economics Global Cities Index 2025, with Melbourne and Sydney earning places in the top 10 among 1,000 of the world’s largest urban centres. Melbourne emerged as Australia’s top-ranking city, claiming 6th place globally, while Sydney followed closely at 7th, both improving on their 2024 standings. This achievement marks a major milestone, particularly as these cities were judged across five critical pillars: Economics, Human Capital, Quality of Life, Environment, and Governance.
Top 10 Cities List [Oxford Economics]
Understanding the Index
The Global Cities Index is a comprehensive ranking system developed by Oxford Economics, covering 1,000 cities worldwide and drawing from 27 indicators to assess urban performance. These indicators are grouped into five categories:
- Economics: GDP, employment, business diversity
- Human Capital: Education, workforce skills, international connectivity
- Quality of Life: Health, safety, affordability, cultural access
- Environment: Emissions, climate resilience, air quality
- Governance: Political stability, rule of law, institutional strength
Cities were then categorised into “archetypes” such as Global Leaders, Cultural Capitals, and Industrial Hubs, allowing for a nuanced comparison of cities with similar development paths.
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Melbourne: Australia’s Cultural and Academic Powerhouse
Melbourne not only retained its lead among Australian cities but climbed three places globally from 9th in 2024 to 6th in 2025. The city stood out in Human Capital, ranking 12th globally, bolstered by its renowned universities—two of which belong to the prestigious Group of Eight. A fast-growing economy and diverse job market have made Melbourne a magnet for foreign workers and students alike.
According to the report:
“Melbourne ranks highest out of all Australian cities in our index and is on a path to overtake its main competitor as Australia’s largest city.”
The city also performed strongly in Economics (ranked 16th), Governance (15th), and placed in the top 10% of cities for Environmental performance, thanks to low emissions intensity and stable climate conditions.
Melbourne’s cultural appeal—hosting events such as the Australian Open and the Grand Prix—further elevated its reputation as Australia’s sporting and cultural capital. However, like many Australian cities, it faced challenges in Quality of Life, with housing affordability being a persistent issue.
Sydney: The Financial Capital Rises
Sydney jumped from 16th to 7th place globally in 2025, making it one of the two new entrants to the top ten (alongside Boston). The New South Wales capital impressed with a 10th place global ranking in Human Capital, outperforming Melbourne in that category.
Sydney’s status as the financial hub of Australia—with institutions like the Reserve Bank of Australia and the ASX—as well as its high number of foreign-born residents (14th globally), contributed to this strength.
Oxford Economics noted:
“Sydney obtains a very strong result overall in our 2025 index,” though it added, “Sydney has lost some ground to its main competitor, Melbourne, in recent years.”
Sydney’s weakest score came in Environment, where it was ranked 145th globally due to bushfires, temperature volatility, and rainfall anomalies. Its Quality of Life score was also impacted by high housing costs, similar to Melbourne.
Brisbane and Perth: Mixed Outcomes
Brisbane climbed to 23rd place globally, overtaking Perth to become Australia’s third-highest-ranked city. It scored strongly in Governance (15th) and benefited from high GDP growth and employment levels, largely driven by its mining and resources sector. However, Brisbane was heavily penalised in Quality of Life (87th) due to soaring housing costs and exposure to climate risks, such as floods and cyclones.
In contrast, Perth dropped from 23rd in 2024 to 31st in 2025, with its low economic diversity and classification as an Industrial Hub playing a role. Environmental concerns also dragged its score down, as Perth faces significant natural disaster risks.
Canberra, Adelaide, and the Gold Coast: Diverse Performances
Canberra, while dropping to 52nd, still ranked 1st globally in Quality of Life due to high life expectancy, low income inequality, and strong public services. The capital’s economy remains relatively small, but its governance and civil liberties earned high marks.
Adelaide slipped slightly to 54th, while the Gold Coast was a positive surprise, rising from 81st to 69th place. This improvement was attributed to the region’s growing population, cultural appeal, and better-than-average climate resilience.
Australia’s Overall Urban Strengths and Challenges
Australia’s cities were recognised for:
- High life expectancy
- Strong governance and civil liberties
- Top-tier education institutions
- Robust economic performance
However, consistent weaknesses included:
- High housing expenditure
- Older population demographics
- Environmental vulnerabilities, particularly in coastal cities
Despite these challenges, the nation’s urban centres remain globally competitive, with Melbourne and Sydney firmly establishing themselves among the world’s elite cities.
Conclusion
The 2025 Global Cities Index reaffirms Australia’s growing urban influence on the world stage. Melbourne and Sydney’s top ten rankings reflect long-term investments in education, infrastructure, and economic diversity. While affordability and environmental resilience remain areas to improve, Australian cities continue to punch above their weight in global comparisons.
As the global landscape shifts, Australia’s cities are well-positioned to adapt, grow, and lead—offering a blueprint for future-ready, livable urban environments.
