Gold Coast, Adelaide and Canberra punch above their weight as Australia's most enterprising cities

Australia's regional and outer-metropolitan cities are emerging as economic powerhouses in their own right, with the Gold Coast, Adelaide and Canberra leading the pack across employment, jobs growth and housing activity, according to KPMG's third annual Enterprising Cities report.

The report profiles 12 cities outside the traditional Sydney-Melbourne axis - collectively home to 10.1 million people and 5.3 million workers representing 36 per cent of the national workforce - and finds that these centres are increasingly competing with the major capitals for talent, investment and business formation.

The Gold Coast recorded the lowest unemployment rate of any city in the study at 3.2 per cent, Adelaide posted the strongest employment growth at 3.8 per cent and Canberra delivered the largest surge in dwelling approvals at 99.5 per cent - a near-doubling that dwarfed every other city measured.

The three standouts each drew their strength from different economic engines.

The Gold Coast's labour market tightness reflects the continued pull of South-East Queensland's population boom and a diversifying economy stretching beyond tourism into health, education and professional services.

Adelaide's jobs growth has been turbocharged by defence procurement, advanced manufacturing and a growing technology sector.

Canberra's dwelling approval spike signals a housing pipeline finally responding to years of constrained supply in a city anchored by public administration but increasingly driven by cybersecurity, space technology and professional services.

Terry Rawnsley, KPMG’s national lead for demographics and urban economics, says the growth paths across the Enterprising Cities investigated have become more divergent than ever.

“The Covid-19 period delivered a pronounced boost to many, with strong population inflows and economic growth,” says Rawnsley.

“While some locations have sustained this momentum over the past two to three years, others have seen one of their key advantages, housing affordability, eroded.

“As a result, growth paths across the Enterprising Cities are now more divergent than at any point in the past five years, increasingly shaped by local economic strengths and the capacity to provide sufficient housing for their workforce.”

The 12 cities examined - which also include Perth, Brisbane, the Sunshine Coast, Newcastle, Wollongong, Geelong, Hobart, Darwin and Western Sydney - are not without headwinds.

The report flags a tightening macroeconomic outlook driven by the Iran conflict's impact on global energy and fertiliser costs, a return of inflation and the Reserve Bank of Australia's monetary tightening through 2026.

“Taken together, these factors point to a short-term outlook defined by heightened uncertainty,” says Rawnsley.

“For Enterprising Cities, resilience will hinge on the strength of their underlying economic foundations, the availability of housing and infrastructure, and their ability to adapt to shifting global and domestic conditions.

“Resilience in this environment is driven by a focus on core business fundamentals.

“By strengthening cost discipline, reinforcing supply chain performance, protecting liquidity, and pursuing targeted revenue opportunities, businesses can respond more effectively to uncertainty and maintain profitability despite broader economic headwinds.”

The report introduces a risk-rating matrix assessing each city's exposure across economic diversity, trade vulnerability and energy intensity.

Adelaide, Canberra, the Gold Coast, Geelong, Hobart, Wollongong and Western Sydney all scored the lowest possible risk rating of one across both trade and energy exposure, positioning them as the most insulated from global supply chain shocks.

At the other end of the spectrum, Darwin and Perth each scored the highest risk rating of five on both trade and energy exposure, reflecting their heavy dependence on resource exports and energy-intensive industries - sectors most directly in the firing line of geopolitical disruption and shifting global commodity flows.

The divergence in risk profiles underscores a broader theme running through the report - that economic diversity is becoming as important as raw growth.

Cities with broad employment bases spanning health, education, government, professional services and technology are better positioned to absorb external shocks than those reliant on a narrow set of export-oriented industries.

Population growth continues to underpin the economic expansion of the 12 cities, but the report warns that housing supply remains a binding constraint.

Beyond Canberra's standout dwelling approval figure, several cities are struggling to translate population inflows into adequate housing pipelines, creating affordability pressures that risk undermining their attractiveness to the workers and entrepreneurs driving growth.

The Enterprising Cities report does not produce a single composite ranking, instead measuring performance across a suite of individual metrics.

But the consistency of the Gold Coast, Adelaide and Canberra at or near the top of multiple indicators - jobs, employment growth, housing approvals and risk resilience - marks them as the cities setting the pace for Australia's economic geography beyond the two largest capitals.