
It was hoped that globalization and technological progress would create a flat world where opportunity would be more evenly distributed, but it has been recognized that distance is far from gone and globalization and technological change have made place more important than ever. The world is not flat – it is getting sharper.
High-paying jobs in law, finance, consulting and related industries are concentrated in a few cities. These are unaffordable for the average person, who is being squeezed out by gentrifying inner cities. In the past, high-paying jobs were more geographically dispersed, as industry and businesses clustered around natural resources such as waterways, coal mines or agricultural centers. As businesses gravitate to cities populated by free knowledge workers, these natural attributes no longer matter. Knowledge workers want to congregate where similar-aged, like-minded professionals live—gentrified city centers or suburbs that offer an abundance of entertainment, food, health, and other options. This resulted in a dramatic reversal, with the poor and artisanal businesses driven out of the city center and their homes and workshops transformed into homes for young professionals. The cores of these superstar knowledge cities are already booming. The same goes for cities like Singapore or Dubai that thrive by connecting professional services.
Remote working disrupts these trends. While this has long been possible, the pandemic has thrown the old rules around normal working hours out the window. In the United States, the United Kingdom and much of Europe, people not required by the workplace now commute an average of three days a week, usually Tuesday to Thursday. The collapse of commitment to office proved extremely damaging to cities. Commercial real estate is suffering, municipal tax revenues are falling, and the viability of businesses that rely on heavy foot traffic, from hairdressers to baristas, is being compromised. Mass transit systems are in a similarly precarious position, hemorrhaging cash.
The benefits of remote working are immediately apparent, namely greater flexibility and billions of hours saved in commute time and carbon emissions. However, short-term productivity gains are likely to be illusory. Creativity thrives on physical interaction and serendipitous encounters. Most jobs are actually apprenticeships. Skills, behaviors, and business culture are learned through informal interactions that cannot be taught on Zoom or Teams. By bringing diverse people together, the workplace also helps build social cohesion and reduce isolation and loneliness. Flexible working hours allow people to meet commitments outside of work and enjoy a better work-life balance and less commuting stress, among other potential benefits. However, remote working needs to be managed more carefully to ensure it does not harm the long-term prospects of individuals, companies and the cities we rely on.
A society without dynamic cities will reduce productivity, cohesion and creativity. Thriving cities are the engine of our economy and where we solve our greatest challenges. To ensure the benefits of these cities are shared more widely, we need more affordable housing and effective public transport systems, schools and other services. However, successful cities are becoming unaffordable as the salaries and wealth of well-paid workers continue to soar and competition for accommodation increases.
The unaffordability of housing, the time and cost of commuting, and the shortage of schools and retirement homes keep prosperous cities out of reach for many working people. The difficulty of moving from one city to another means people are half as mobile as they were a generation ago, locking individuals and communities into places with bleak prospects.
The rise of generative artificial intelligence is likely to exacerbate this divide, as automated systems increasingly replace an increasingly wide range of repetitive human tasks and increase the wealth of those on the front lines of technology, legal and financial services. Rising incomes and changing demographics will accelerate changes in consumption and choices. The appeal of dense and diverse cities continues to grow as spending shifts from manufactured goods such as cars and stoves to services such as massages and restaurants. As the age at which people marry and have children increases, people spend more of their income and time enjoying the rich variety of recreation available in vibrant urban communities.
Rising inequalities within and between dynamic cities and other places mean that they are targets of growing populist backlash against metropolitan elites. The solution to growing divisions is not to undermine the success of vibrant cities. Rather, it’s about making them cheaper and more accessible. That means investing in public housing and transportation, and creating cleaner, walkable cities. We need to move away from the outdated model of office central business districts that are vacant at night to create vibrant mixed residential, office and entertainment communities. Converting redundant offices into residences offers the opportunity to quickly drive these developments forward. The extreme floods, fires and heat experienced by many cities have also highlighted the urgent need to transform cities into sustainable homes for the future.
Cities have unlimited creative potential and provide a source of hope for the future. By working together to improve them, we can realize their potential to create a better life for all.
Ian Golding is a professor at Oxford University and co-author with Tom Lee-Devlin Urban Times: Why our future will be a win-win or a lose-lose one.
The views expressed in Fortune Star review articles represent solely those of the author and do not necessarily reflect the following views and beliefs: wealth.
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