North Sydney LGA economic product over $18 billion

22 November 2024

North Sydney’s economy has experienced robust growth over the past decade, driven by its dominance in professional, scientific, and technical services, information media and telecommunications, and financial and insurance services. However, emerging workforce trends and a lack of industry diversity highlight challenges for the local government area in sustaining its economic trajectory, according to a new Economic Development Study prepared by SGS, Certified B and the Planning Studio.

North Sydney’s gross regional product (GRP) grew from $13.1 billion in 2011 to $18.6 billion in 2022, reflecting consistent growth supported by its core industries. The number of jobs in the LGA has increased from 60,053 in 2006 to 80,715 in 2021, representing an average annual growth rate (AAGR) of 2.3%. This growth aligns closely with Greater Sydney, which recorded a 2.4% AAGR over the same period.

The workforce remains overwhelmingly white-collar, with professionals, managers, and clerical workers making up over 80% of roles—significantly higher than Greater Sydney’s 61%. These industries also contribute to North Sydney’s high-income profile, with nearly a quarter of workers earning over $3,000 weekly, double the proportion seen across Greater Sydney.

Employment growth in the information media and telecommunications sector has been particularly notable, nearly doubling between 2016 and 2021, driven by the relocation of major companies like Nine Entertainment. However, this sector faces broader challenges, including technological disruption and competition from other hubs such as Sydney’s Tech Central precinct.

The dominance of three key industries—professional services (29.6% of jobs), information media (11.1%), and financial services (10.5%)—provides a strong economic foundation but also exposes the LGA to risks. Economic concentration makes North Sydney vulnerable to structural shifts in these sectors, such as declining traditional publishing and intensifying competition for IT and finance roles.

Other industries, including retail, food services, and arts and recreation, remain underrepresented, accounting for less than 10% of jobs compared to 15.5% in the Eastern Harbour City and 16.5% in Greater Sydney. These sectors represent opportunities for diversification, particularly as they can complement the professional workforce and enhance the area’s liveability.

Emerging industries such as health care and education are also showing growth potential. While not yet dominant, these sectors could leverage the LGA’s skilled workforce and proximity to institutions like the Mater Hospital and Charles Sturt University to anchor future economic expansion.

The COVID-19 pandemic has accelerated the adoption of hybrid work models, with nearly 70% of North Sydney workers reporting working from home during the 2021 Census—far exceeding the 41% in Greater Sydney and 50% in the Eastern Harbour City.

This shift has reduced foot traffic in the North Sydney CBD, challenging local businesses and contributing to rising office vacancy rates, which stand at 21.4% compared to 12% in the Sydney CBD. However, demand for premium office spaces with enhanced amenities remains strong, as businesses seek to attract workers back to physical offices.

The LGA’s connectivity is being bolstered by the Victoria Cross Metro station, offering opportunities to improve public amenities such as walking connections, green spaces, and retail options.

While North Sydney’s workforce has grown to over 80,000 jobs, only 13.6% of workers live within the LGA, with most commuting from neighbouring areas like the Northern Beaches, City of Sydney, and Parramatta. Conversely, over 75% of North Sydney residents commute out of the LGA for work, primarily to the Sydney CBD.

This underscores opportunities to strengthen local economic ecosystems by increasing local self-containment and supporting hybrid work models that enable residents to spend more within the LGA. The high proportion of knowledge-intensive jobs also positions North Sydney to capture benefits from remote working trends by attracting businesses and workers who value flexibility and proximity to amenities.