A factory can be built in a few years. Training an engineer, building a strong university and turning a city into a place where a specialist wants to stay for the long term is much more difficult.
As Kostanay Region’s economy becomes more complex, human capital is emerging as one of the key conditions for further growth.
Automotive manufacturing needs engineers and technologists. Deep processing needs specialists in automation, chemistry, food technology and export standards. New energy facilities require their own technical workforce. Major production facilities also generate growing demand for IT, finance, logistics and professional services.
As a result, building factories gradually changes what the region itself is required to provide.
If the economy becomes more complex, the city must become more complex as well.
Housing, universities, schools, healthcare, public transport and the quality of the urban environment begin to serve more than residents’ comfort. They become part of the competition for the people without whom the next stage of industrial growth simply cannot happen.
Jobs alone are no longer enough for industry
In the early years of industrial growth, the appearance of a new enterprise can itself be the region’s main attraction.
But as the number of production facilities grows, the situation changes.
Kostanay’s automotive cluster already needs specialists in casting, reduction gears and automotive components, CKD assembly, engineering and software. More than 4,200 employees and students have trained through Allur University, while around 1,900 engineers have received production training in CKD technologies.
At the same time, the agro-industrial sector is seeing automated dairy farms, modern processing facilities, agricultural drones and farm machinery with self-driving systems.
This is already a different labour market.
The economy needs not only more workers, but a broader range of capabilities. The region therefore has to solve two tasks at once: train specialists locally and create conditions in which qualified people want to live and build careers here.
This is where industrial policy meets urban policy.
The master plan as an economic document
This logic is stated particularly clearly in the new development concept for Kostanay itself.
The revised city master plan extends to 2055. It is based on the idea of a “connected, functionally balanced and sustainable city”, with one of its key concepts described as “economic gravity”.
The logic is straightforward.
Industrial growth increases demand for energy and new production. Capital finances economic expansion. But further development requires people, and a high-quality urban environment is needed to retain them.
This represents an important shift in how urban policy is understood.
A master plan becomes more than a document about where to build housing and lay out streets. It must answer an economic question: what kind of city will the region need if industry continues to grow at its current pace?
This is the basis for the principle of developing social infrastructure in advance: schools, kindergartens and other facilities should appear together with new neighbourhoods, rather than years after residents move in.
Half a million square metres of housing a year
Housing is the first condition for urban growth.
For the past three years, around 500,000 square metres of housing have been commissioned annually in Kostanay Region. Almost 18,000 families have improved their housing conditions, and the region ranks fourth nationally for the pace of construction work.
The largest new project is the Astana residential district.
More than 150 residential buildings are planned here. But the scale of construction is not the only important feature. The district is designed from the outset as a “city within a city”. Alongside housing, it includes schools, kindergartens, a clinic, a park, sports facilities, cycle lanes and commercial premises.
A separate Qostanai Jastary programme for young residents is being implemented jointly with Otbasy Bank. Around KZT 6 billion has been allocated, and approximately 400 people have already purchased their own homes.
Housing here has a direct connection to the economy.
An enterprise can offer a specialist a job. But the decision to remain in the region depends on a much longer list of factors: whether a family can buy a home, where children will study, how convenient the commute is, and whether healthcare and recreation are nearby.
Industrial investment therefore creates growing demand for investment in the city itself.
Education has to keep pace with industry
The workforce challenge is even more complex.
In recent years, 10 new schools with 6,800 places have been built in the region, including six under the Comfortable School project. Fifteen kindergartens with 2,300 places have also opened. Since 2023, more than KZT 24 billion has been allocated to capital and routine repairs of educational institutions, covering more than 500 facilities.
But for the new economy, the content of education matters as much as the number of study places.
At the IQostanay SMART centre, around 2,000 school students study robotics, programming, 3D modelling and engineering. The centre includes laboratories for engineering, aeromodelling, physics and renewable energy.
International cooperation is also expanding in higher education.
Akhmet Baitursynuly Kostanay Regional University runs a dual-degree programme in IT fields with the University of Minnesota and an academic exchange in mechanical engineering with South Korea’s Dong-Eui University.
ChatGPT Edu is also being introduced into the education system: according to Freedom, the platform is used by 505 educational organisations and more than 5,000 teachers.
Each project on its own looks like an education initiative. Together, however, they address a broader question: can the region develop its own specialists for an economy that is becoming more technology-intensive faster than before?
This is particularly important for mechanical engineering. Production localisation has limited value if core expertise has to be imported continuously along with components and technologies.
The next stage of industrial localisation therefore inevitably means localisation of knowledge as well.
A city competes on more than salaries
Education and housing alone are also not enough to retain a specialist.
People choose an entire environment: how easy it is to move around the city, where they can spend their free time, what their neighbourhood looks like, whether quality services are available and how easily they can reach other cities.
Kostanay has gained new public spaces in recent years: the central park has been renovated, a triathlon park with an embankment along the Tobol has been created, and several parks and squares have been improved. In one year alone, 80 public spaces were upgraded.
The city bus fleet has also added 139 new buses.
The external market for urban services is changing as well. Marriott International and Novotel hotels are under construction in Kostanay, and a Holiday Inn project is under consideration. International hotel operators enter markets where they expect sufficient business and tourist flows, so their arrival can be viewed as an indirect indicator of growing economic activity in the city.
The airport shows the same trend.
Passenger traffic rose from around 295,000 people in 2022 to 454,000 in 2025. The route network is expanding, including international destinations.
All of these changes strengthen one quality: connectivity.
For a modern economy, it is not enough to have qualified specialists within the region. It is equally important that they can interact quickly with partners, universities, head offices and markets beyond it.
Healthcare is becoming part of the competition for people
There is another element rarely linked directly to economic policy: healthcare.
Since 2023, 38 new medical facilities have been built in Kostanay Region, including outpatient clinics, feldsher-midwife stations, medical posts and polyclinics. Most are in rural areas. New polyclinics have also opened in Tobyl and Kostanay’s Yubileiny residential district.
Interregional hospitals in Arkalyk and Zhitikara are being modernised, including the installation of MRI and angiography equipment. New rehabilitation centres have also been established.
But the staffing issue within healthcare itself is especially revealing.
Support measures of up to KZT 5 million in towns and up to KZT 7 million in rural areas are available to attract doctors to the southern districts of the region.
This is a small-scale version of the same problem facing the entire regional economy.
Creating a job is not enough. To attract a qualified specialist to a particular place, a region has to compete on conditions.
What is especially visible in healthcare today will become increasingly apparent in other professions as industry grows more complex.
Growth must extend beyond the regional capital
Another question is how far the new development model will spread to other cities in the region.
Rudny provides one version of such a transition.
Alongside major industrial investment, the city’s housing stock is being restored. Over four years, 14 previously abandoned apartment buildings—698 apartments—have been returned to use. Four more buildings were constructed through private investment, while a building in Kachar was reconstructed to provide 83 apartments.
Arkalyk represents a different case.
After a long period of peripherality, the city is receiving transport, social and economic projects at the same time. The airport has been restored, road links are being modernised, a new school with a STEM laboratory has been built, the pedagogical institute has received university status and is expanding its programmes, and healthcare is being upgraded.
At the same time, efforts are under way to diversify the local economy: a poultry farm is being modernised with planned capacity of up to 300 million eggs a year and its own feed mill, while livestock complexes are also being developed.
Both examples matter for the same reason.
If economic growth is concentrated only in the regional capital, parts of the territory will continue to lose people and economic activity. The model becomes more resilient when additional growth centres emerge.
A factory creates jobs. A city retains people
Industrial policy can easily focus on the most visible assets—new factories, power stations and logistics complexes.
But a complex economy places a broader set of requirements on a region.
An engineer needs more than a production site. They need a university for further training, a school for their children, housing, healthcare, transport and a good urban environment. A company executive needs an airport and hotel infrastructure. A young specialist needs to see a long-term career path in the region.
This is why investment in the city and the social sphere cannot be viewed separately from Kostanay Region’s economic transformation.
At a certain point, they become a condition for it.
While a region is attracting factories, capital is the main scarce resource. Once factories multiply and production chains become more complex, the next scarce resources are skills and people.
This creates another economic cycle:
production creates good jobs → jobs attract people → population and income growth expands the market for services and housing → a better city becomes more attractive to specialists and businesses → the region gains the capacity to launch more complex production.
This closes the loop of “economic gravity” embedded in Kostanay’s new development logic.
The next stage of regional growth will therefore depend on more than how much investment flows into its enterprises.
The key question is whether the region can become a place where a qualified person comes for a job and stays for a life.