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The Economy

A Gini of 0.63, 21% unemployment, and Africa's largest tech hub. The same city, three different economies.

0.63

Gini coefficient

21.1%

Unemployment

R 89,000

GDP per capita

14.2%

Contribution to national GDP

R 18.90

USD/ZAR exchange rate

  Cape Town is an economy of extremes. The Western Cape contributes 14.2% of South Africa's GDP, with Cape Town generating the bulk. The city hosts Africa's largest tech hub, a growing film industry, and world-class wine exports. Yet 21% of the labour force is unemployed, and the Gini coefficient of 0.63 makes it one of the most unequal cities on Earth. Affluent Constantia and struggling Khayelitsha share a municipal boundary but not an economic reality.

Inequality: among the highest in the world, and barely moving

The Gini coefficient measures income inequality on a 0 to 1 scale. Cape Town's 0.63 places it near the top of global rankings. The gap is visible: private security estates and informal settlements separated by a single road. A decade of economic growth has not narrowed the divide.

Income inequality: Cape Town vs peer cities (Gini)

Stockholm

0.27

Berlin

0.29

London

0.35

New York

0.51

São Paulo

0.59

Cape Town

0.63

Johannesburg

0.65

0 = perfect equality, 1 = perfect inequality. Green <0.35, Gold 0.35–0.55, Red >0.55.

Key takeaway. Cape Town's Gini of 0.63 sits between São Paulo and Johannesburg. Among world cities with comparable data, only a handful are more unequal. The number has barely moved in a decade.

Finance leads, tourism gets the attention, agriculture feeds the region

The Western Cape economy is services-heavy. Finance, insurance, and business services generate nearly a third of GDP. Tourism is visible but smaller than most visitors assume. Agriculture (wine, fruit, wheat) is a modest GDP contributor but the largest rural employer and a major export earner.

Economic sectors by GDP contribution (Western Cape)

Finance & business

30.1%

Trade & hospitality

15.8%

Government

13.9%

Manufacturing

12.4%

Transport

9.2%

Construction

3.8%

Agriculture

3.6%

StatsSA GDP-R 2023. Finance includes insurance, real estate, and business services.

Key takeaway. Finance and business services alone generate 30% of the regional economy. Tourism (buried in "trade & hospitality") is the sector most visible to visitors but not the largest employer. Agriculture punches above its GDP weight in job creation.

Unemployment: better than the rest of SA, still above 20%

The Western Cape has South Africa's lowest provincial unemployment rate. That sentence sounds better than it is: 21% of the labour force is without formal work. The COVID spike to 25% has partially reversed, but the recovery has been uneven, concentrated in skilled sectors while entry-level jobs remain scarce.

Unemployment rate over time (Western Cape)

Q4 2019

20.3%

Q4 2020

24.5%

Q4 2021

25.1%

Q4 2022

22.4%

Q4 2023

21.8%

Q4 2024

21.1%

StatsSA QLFS. Expanded definition (including discouraged workers) is roughly 10 points higher.

Key takeaway. Unemployment has improved from its COVID peak of 25% but remains stubbornly above 20%. The Western Cape has the lowest provincial rate, but that is cold comfort when the national figure is 32%.

Data updated: 2026-04-12

Frequently asked questions

What is the Gini coefficient and why does it matter?

The Gini coefficient measures income inequality on a scale from 0 (everyone earns the same) to 1 (one person earns everything). South Africa's 0.63 is among the highest in the world, a direct legacy of apartheid-era economic exclusion. In practical terms, it means the distance between rich and poor is wider here than almost anywhere else.

Is Cape Town expensive for tourists?

The Rand's weakness against the Dollar and Euro makes Cape Town remarkably affordable for international visitors. A quality restaurant meal costs R200–400 (roughly €10–20). Accommodation ranges from R800/night for a good guesthouse to R3,000+ for luxury. For South African residents, the picture is different: food and fuel inflation run at 6–8% annually.

What industries drive the Cape Town economy?

Finance and business services lead (30% of GDP), followed by trade and hospitality (16%), and government (14%). The tech sector is growing fast, with Cape Town hosting the highest concentration of startups in Africa. Wine, film production, and the creative industries punch above their GDP weight in international visibility.

How does Cape Town compare to Johannesburg economically?

Johannesburg generates more GDP overall (Gauteng province contributes 33% of national GDP vs the Western Cape's 14%). But Cape Town has lower unemployment, lower crime rates, and a more diversified economy. Johannesburg is the financial capital; Cape Town is the lifestyle and tourism capital. Many businesses maintain offices in both.

Labour & Employment

• Statistics South Africa, "Quarterly Labour Force Survey Q4 2024" (March 2025)
• Statistics South Africa, "GDP-R by Region 2023" (2024)

Inequality & Development

• World Bank, "Gini Index Data" (2024)
• City of Cape Town, "Spatial Development Framework: Economic Indicators" (2024)

Currency

• South African Reserve Bank, "Exchange Rate Data" (April 2026)