The City of Melbourne is an economic powerhouse. On just 38 square kilometres of land, it generates $116 billion in annual economic activity, which is nearly 22 per cent of Victoria’s total output. With a reputation for innovation, diversity and resilience, the city is a magnet for investment, talent and visitors. Over the past two decades, the City of Melbourne has maintained an average annual growth rate of about five per cent, more than twice as fast as the rest of the Victorian economy. This has been driven by the city’s knowledge-based economy, world-class retail and hospitality sectors, globally leading universities and a thriving cultural scene.
This draft Economic Development Strategy 2025–2029 proposes a bold ambition: to make Melbourne the Asia-Pacific’s city of choice for innovation, talent and liveability. At the same time, it identifies that economic growth must be inclusive and community-driven, ensuring that prosperity is shared by all.
Our vision
Melbourne’s economic strengths
The City of Melbourne’s strong economy is underpinned by four key elements: a broad range of industries; a strong knowledge economy; a diverse, young and talented population; and a central geographic location. Our city is home to leading financial institutions, cutting-edge innovation hubs, and vibrant retail and hospitality precincts. The city’s competitiveness and resilience are built on the interdependence between the knowledge industries in high rise office buildings and the economic activity taking place in the shops, restaurants and other premises at street level.
However, Melbourne must adapt to global competition, shifts in working habits and affordability challenges. This strategy sets out a plan to capitalise on opportunities and overcome challenges to secure Melbourne’s future as a global leader in business, culture and innovation.
Areas for improvement
Melbourne’s core strengths have played a significant role in its resilience and success.
However, certain challenges must be addressed to create new opportunities for growth:
Key opportunities for growth
We will position the city as a premier location for doing business, and we will further enhance the city’s strengths in innovation.
To realise this opportunity, we will:
- Support start-ups and scale-ups in Melbourne’s key innovation sectors: health technologies, climate tech, digital games, sports tech and education tech.
- Strengthen social impact innovation by enabling investment, capability building, procurement and promotion.
- Build Melbourne’s global reputation as a premier destination for investment, entrepreneurship and innovation.
- Lead in climate solutions by capitalising on the shift to a zero-carbon economy and expanding the circular economy.
- Connect industry, government research and entrepreneurs to drive commercial activity and boost Melbourne’s competitive edge.
- Foster emerging businesses through targeted investment, regulatory sandboxes and innovation pilots.
- Accelerate innovation districts in Arden, Fishermans Bend and City North in partnership with the Victorian Government.
By fostering high-growth industries – particularly in the innovation economy – Melbourne will be an even more attractive destination for investment and jobs, further enhancing its economic resilience and global competitiveness.
Melbourne’s diverse workforce is a strength. By creating pathways for underutilised talent and enhancing its appeal to global talent, Melbourne can secure its position as a magnet for skilled individuals and ensure that all city residents and workers can maximise their potential and access the benefits of the city’s economy.
To realise this opportunity, we will:
- Support entrepreneurial initiatives within migrant and diverse communities that boost economic participation and strengthen the city’s reputation as a place where everyone can thrive.
- Strengthen the work to realise Melbourne’s ambition to be the world’s best city for the student experience.
- Develop targeted programs to transition international students into the workforce.
- Attract and embed global talent by advocating for more favourable migration outcomes.
- Lead on initiatives that maximise participation for all, including a renewed focus on Aboriginal economic development.
By working towards an inclusive workforce, Melbourne’s economy will provide more opportunities for more people.
Invigorating the city’s vibrancy and economic performance will cement the city’s reputation as the preferred place to work, study, live and play.
To realise this opportunity, we will:
- Strengthen Melbourne’s 24-hour economy by helping traders and businesses adapt to new city rhythms, engaging with industry and government to reduce burden on traders and businesses, and aligning Council operations with changing demand.
- Maximise the benefits of new infrastructure, including five new Metro stations in 2025 and the future airport rail link, to boost city access, activity and productivity.
- Revitalise underutilised properties by encouraging creative reuse, converting vacant office spaces, and supporting the transition to net-zero buildings.
- Tailor support for city precincts by investing in targeted initiatives like Business Improvement Districts to enhance local economic development.
- Sustain a vibrant experience economy by supporting retail, hospitality and live music to keep Melbourne’s high streets active and appealing.
A thriving city will cement Melbourne’s reputation as a top global destination for business, culture and tourism.
Beyond major economic initiatives, Melbourne must maintain its reputation as one of the world’s most liveable cities. Success depends on vibrant streetscapes, green spaces, cultural activation, safety; accessibility, and high-quality transport.
To achieve this, we will:
- Support affordable housing and public transport to benefit key workers and improve city accessibility.
- Deliver a world-class events program that activates precincts year-round and showcases Melbourne’s diversity.
- Strengthen the creative sector by facilitating collaborations, supporting public art, and improving access to affordable workspaces.
- Enhance city amenity with dedicated programs to keep Melbourne clean, beautiful and safe for all.
- Support business success through clear communication, targeted information, and a proactive Business Concierge service.
- Align city programs with community values, including Melbourne’s global connections, sustainability goals and net-zero commitments.
By getting the fundamentals right, Melbourne will enhance its economic competitiveness and liveability.
