On any weekday morning, Joburg still looks every bit the economic capital. Commuters stream into Sandton’s offices; freight trucks move through City Deep, one of Africa’s largest inland ports; traders crowd the inner city; and construction cranes dot parts of the northern suburbs. The JSE continues to anchor Africa’s biggest financial market, and many of the continent’s largest companies still call the city home. Yet beneath the bustle lies a growing sense that South Africa’s economic engine is beginning to lose power.

Joburg, which generates around 15%-16% of South Africa’s GDP, is showing signs of strain that experts say is a national economic problem.

Urban planner Philip Harrison notes that Joburg has stopped outpacing national growth and now merely tracks it, blaming political instability and weak governance for scaring off investment.

Economist Ebrahim Patel says cities such as Nairobi, Kigali and Addis Ababa could erode Joburg’s status as the continent’s commercial gateway.

A trader sells sweets next to an abandoned hotel builiding (Per-Anders Pettersson)

Labour leader Zwelinzima Vavi says workers “pay twice” — through taxes and again privately for failed services, while the Joburg Crisis Alliance says the city has crossed into “systemic governance failure”, though it is not yet at a point of no return.

Mayor Dada Morero disputes claims of irreversible decline, citing an unqualified audit, a restored JSE debt-listing status and a positive Moody’s outlook as recovery signs.

There’s broad agreement that Joburg is too economically important to fail. The dispute is over how close it is to the edge — and whether governance can stabilise fast enough to restore confidence before the costs (business flight, job losses, rising living costs) ripple nationwide.

Can South Africa afford its biggest economic engine to keep underperforming?

The city’s failures carry consequences that extend far beyond its boundaries. If Joburg slows, South Africa slows with it. That is why economists, business leaders and urban planners say Joburg’s problems have become a national economic concern.

“Joburg simply tracks the national economy. It is no longer leading the country,” says Harrison, South African Research Chair in spatial analysis & city planning at Wits University. “The country needs Joburg to be its economic core … to take the lead.”

But recent labour statistics show Gauteng’s unemployment rate exceeds the national average, suggesting the wealthiest province is struggling to create jobs.

The city keeps hoping to bluff its way out of a crisis. The greatest obstacle is unethical leadership

—  Nokuthula Khwela

Joburg’s latest unemployment rate (34.7%, according to StatsSA) sits slightly above the Gauteng average (34.1%) and well above the national rate (32.7%). It is not the worst metro in the province — Tshwane’s rate is 36.8%. Ekurhuleni is at 32.4%.

Harrison says governance is critical. “Business doesn’t like investing where the basics are not working and where there’s governance uncertainty. I would put governance at the top of the list.”

Years of political instability have made long-term planning difficult. “You can’t have constant changes in political leadership and expect the bureaucracy to remain focused. It becomes confused. It becomes demoralised,” he says.

He says Joburg also faces a deeper structural challenge. The city has reinvented itself throughout its history. Gold mining drove early development before manufacturing became its economic backbone. After 1994, finance, telecommunications and the expansion of South African companies into the rest of Africa fuelled growth.

Clothing hangs on a washing line in front of windows of a dilapidated residential apartment in the the Central Business District (CBD) of Johannesburg (Bloomberg)

But that momentum has slowed. “There isn’t an obvious new growth driver,” Harrison says, and Joburg is losing one of its greatest assets — its middle class. He says many residents who once invested in Joburg are choosing to buy property and build businesses elsewhere.

Patel, CEO of Magellan Investment Management, echoes the sentiment. “Its fiscal stability is critical to national economic growth, tax revenue and investor confidence.” But he warns that deteriorating infrastructure and weak governance undermine that position. “Businesses having to independently provide power, water, security and waste management significantly increases operating costs.”

Vavi, general secretary of the South African Federation of Trade Unions, says the city’s deterioration has become a national emergency. “Joburg’s crisis is no longer simply a municipal problem … what happens in Joburg affects every province, every business and millions of workers.”

The Joburg Crisis Alliance, established in 2023 to campaign for better governance and accountability, says the city’s problems have moved beyond isolated service delivery failures to a broader governance crisis. It has “crossed the line from financial distress into systemic governance failure”, says spokesperson Nokuthula Khwela.

She says the biggest concern is not the absence of plans but the failure to implement them consistently. “The city keeps hoping to bluff its way out of a crisis. The greatest obstacle is unethical leadership.”

Despite this, the alliance does not believe Joburg has reached the point of no return. “The city is on the edge, but has not gone over the precipice yet,” Khwela says.

Morero insists that a measurable recovery has begun. He says the priorities are restoring financial stability, renewing infrastructure and rebuilding the inner city through partnerships with business and civil society.