“Arrogant” Zurich faces identity crisis

Zurich's Bahnhofstrasse, viewed from the main station Schweiz Tourismus

This weekend's local elections in Zurich come at a time of great soul-searching for Switzerland's most populous canton.

A faltering economy and rising unemployment has had a humbling effect on the residents of the country’s “number one city”.

Zurich’s citizens often overlook the fact that “little” Bern is the capital of Switzerland. Often referred to as “Zurich West”, Bern may boast the federal parliament but Zurich provides the country’s financial and cultural pulse – or so the argument goes.

Zurich’s arrogance may not yet have disappeared entirely from the chic boutiques to the plush bars and offices. Its airport may be run by a firm called “Unique” and the city may still boast (for now) the telephone prefix “01”.

But a string of high-profile business disasters, most notably the collapse of the Zurich-based national carrier, Swissair, has hit the confidence of the previously smug pinstripe brigade.

Culture vulture

At the end of last year, even the culture vultures were shaking their beaks in despair as the city controversially sacked (and then just as controversially re-appointed) theatre director Christoph Marthaler.

Having overcome the economic crises of the early 1990s by transforming much of its industrial workforce into the growing service sector, Zurich is once again facing growing unemployment.

Of the 140,000 service sector jobs created between 1985 and 2001, 10,000 have already disappeared.

Unemployment figures may be traditionally high near the start of the year, but the canton’s current jobless rate of 4.6 per cent is almost one per cent higher than the national average with the urban centres of Winterthur and Zurich itself currently “boasting” figures of 5.7 and 5.2 per cent respectively.

Redundant

“If one considers the numbers alone, Zurich’s unemployment rate is not yet as bad as it was at the start of the 1990s,” points out professor Bernd Schips of the Swiss Institute for Business Cycle Research. “But the striking factor is the type of workers being made redundant.

“Skilled workers are losing their jobs which is a new thing. Zurich, like the rest of Switzerland, is highly dependent on exports – and that applies equally to the service sector.”

Many are already asking if the city and canton – marketed together as the “Greater Zurich Area” can continue to play a part on the world’s financial stage.

Former Zurich mayor Josef Estermann believes that Zurich’s recent troubles are part of a more general international development.

Multinationals

“Everywhere you look, smaller financial centres are losing their importance,” Estermann told swissinfo. “Zurich, like Frankfurt, is still a location for many multinationals but it’s no longer a favoured location for their headquarters. Those are centring more and more on the big three of London, New York and Tokyo.”

Estermann warns against any “schadenfreude” on the part of Zurich’s fellow Swiss cities, however, insisting that Zurich’s losses will not be their gains.

“If Zurich were to lose its status as a major economic player, it wouldn’t be the likes of Geneva that would profit – it would more likely be London, or Munich.”

In a bid to prevent such a scenario many analysts are urging Zurich’s business community to explore new possibilities, such as increased partnerships with the city’s university. Biotechnology is commonly cited as an area in which Zurich could be more active.

Economic woes

If anyone in Switzerland is still sniggering at the economic woes of Zurich, it shouldn’t be the city’s nearest neighbours.

Political scientist Iwan Rickenbacher points out that any crisis in Zurich will have major consequences for nearby Zug, Schwyz and Schaffhausen – all of whom send significant numbers of commuters into Zurich every morning.

A recent survey by the business magazine “Bilanz” also served as a reminder that Switzerland’s national fortunes are still strongly based around Zurich, even in these difficult economic times.

Listing the 50 people who it considered to be the “most influential” in Switzerland, “Bilanz” came up with only two names from the southern canton of Ticino and just seven from the French-speaking west of the country.

The others were concentrated around Basel, Bern and of course Zurich, suggesting that the country’s largest city may still have a few reasons to swagger.

swissinfo, Ariane Gigon Bormann (translation: Mark Ledsom)

Key facts

Canton Zurich provides 720,000 jobs in 70,000 companies.
A 2000 study by the cantonal bank claimed that one Swiss franc in nine was generated in Zurich.
Between 1985 and 2001, the city created 140,000 jobs in the services sector, 10,000 of which have already disappeared.
During the same time period, 60,000 jobs went in industry.
Unemployment in Zurich has risen over the past 18 months from 17,000 to 40,000.