World’s Top 20 Places to Live? Not in the U.S.

Forbes.com just caught on, but Mercer Consulting’s annual report on the world’s top places to live hit news desks in late April. Short story: no American City makes the list; European cities dominate the list.

Mercer’s survey is based upon an index score of 100, with New York City the base city. The following factors go in to creating an overall score for world cities:

• Political and social environment (political stability, crime, law enforcement)
• Economic environment (currency exchange regulations, banking services)
• Socio-cultural environment (censorship, limitations on personal freedom)
• Health and sanitation (medical supplies and services, infectious diseases, sewage, waste disposal, air pollution)
• Schools and education (standard and availability of international schools)
• Public services and transportation (electricity, water, public transport, traffic congestion)
• Recreation (restaurants, theatres, cinemas, sports and leisure
• Consumer goods (availability of food/daily consumption items, cars
• Housing (housing, household appliances, furniture, maintenance services)
• Natural environment (climate, record of natural disasters)

For overall quality of life based upon these factors, Mercer calls these the top 10 cities:

Top 10 cities: Quality of living

Base City: New York, US (=100)

In North America, Vancouver B.C. gets the highest marks in the region, placing fourth. Other American cities in the top 50 include, Honolulu (29), San Francisco (30), Boston (35), Portland, OR (42), Washington D.C. (44-tie), Chicago (44-tie), New York City (49), and Seattle (50). Conspicuous for it absence is Los Angeles; conspicuous for its high rankings is the Cascadia Region (from Vancouver to Portland).

Cities in America generally score low on this report for one reason: infrastructure. The Forbes.com article notes:

For the first time, Mercer also evaluated cities on the basis of their infrastructure, including electricity supply, water availability, telephone and mail services, public transportation, traffic congestion and the range of international flights from local airports.

Infrastructure was a category that propelled many German cities toward the top of the table. After Munich, which notched the two spot, Düsseldorf finished sixth and Frankfurt eighth, followed by Berlin at No. 16.

In the report, Slagin Parakatil, senior researcher at Mercer, said simply, “German city infrastructure is among the best in the world” and held particular praise for the fast connections available to international destinations.

Credit the high priority German cities place on urban mobility, especially trains, which are seen as instrumental to attracting and developing business in Europe’s largest economy. Maria Krautzberger, permanent secretary of the Berlin Senate Department for Urban Development, told Forbes that the ability for companies to connect to global business networks of suppliers and customers makes infrastructure an essential competitive advantage for cities.

Infrastructure improvement, particularly in high-speed rail, has also been a priority of the Obama administration, which allocated $8 billion of the $787 billion stimulus package to the cause of six possible high-speed corridors around the nation.

But the U.S. is a bit behind the curve. Germany, for example, has had high-speed rail since 1991. In Japan, the Shinkansen, the country’s high-speed network, has been operational since 1964.

While the Obama administration has focused its support for such networks through the creation of jobs and easing of congestion, the long-term competitive advantage that cities gain as the result of such linkages has the potential to be its longest-term benefit.

The world’s top 10 cities based on infrastructure according to Mercer, are:

Top 10 rankings - City infrastructure

* City Infrastructure Ranking 2009 includes the following criteria:
electricity, water availability, telephone, mail, public transport, traffic
congestion and airport.

In North America, Vancouver again places sixth. Atlanta is the first America city appearing on the list at 15. Others include Washington D.C. (24), Chicago (28), New York (32), Boston (33), Honolulu (41), Miami (47), and Houston and Seattle (tie-49).

It would be interesting to see why Portland, OR fell off this list since the city is world renowned for its rail service. My guess is that the Airport does not feature the number of international connections that Mercer probably rates highly (and why Atlanta rates so highly on the infrastructure list). And having lived in Seattle for a good bit of my life I am surprised that the traffic congestion and lack of rail support from the airport didn’t impact that city’s rankings in a more negative way.

At any rate, from an international business perspective infrastructure is a critical component for businesses seeking to locate plants, property, equipment and people.