ESI Center for the Future of Cities: One year and Counting…

Last year, Econsult Solutions launched ESI Center for the Future of Cities, bringing together the firm’s thought leadership and consulting work in urban economics, strategy, and analytics. Our goal is to make cities and regions of all sizes and shapes more competitive, more livable, and more equitable. We recognized that coming out of the pandemic, there was a need for understanding the changes that cities were going through, the future forces that would affect our great metropolitan regions, and the impact that new technologies and approaches would have on city residents, businesses, and governments.

What we have learned is that the new, post pandemic future of cities is still being written. Think about what we have seen in the past twelve months:

Changing Definition of Quality of Place

As we have moved from the COVID pandemic to the COVID endemic, we are realizing that getting back to what in 2019 we thought of as “normal” may never happen. Two years of work from home requirements may have fundamentally changed the future of work. In many cities, offices remain stuck somewhere between 40 and 50% occupancy rates, as combinations of COVID outbreaks and permanently changed work patterns have combined to reduce the physical presence of employees in now half-full (or less) offices. Professional service firms have struggled to find the right balance between the innovation and collaboration that comes from in-person meetings and encounters and the focus and efficiency that we learned was possible during the height of the pandemic.

The reduced office occupancy and shift in work locations has had other impacts on how cities and regions work.

  • Tax structures built on commuter taxes (like Philadelphia’s or New York’s commuter wage or income taxes) are less reliable sources of revenue with increased worker flexibility or outright remote work.
  • Downtown lunch spots and retailers are struggling due to reduced office occupancy, while neighborhood and suburban lunch spots are jammed with folks getting out of their home offices, creating new traffic jams and labor shortages.
  • Commuting patterns have been upended, with transit schedules built to service the rush hour peaks of 9 to 5 office days being reimagined to deliver more frequent services throughout the entire day to meet demand for mid-day meetings, reconfigured work schedules, and a more mobile workforce.

Our changing work life has also made a difference in our out of work time experiences. There has been an increased emphasis on outdoors experiences, whether that is sidewalk cafes and patio seating for restaurants, to increased use and demand for trails, parks, and other outdoor amenities. New policies for investments in these and similar amenities are now required for communities looking to compete for and retain talent which can now work and live almost anywhere. How we pay for this form of green infrastructure is a key policy decision going forward for many city leaders.

Over the last two years, ESI has been involved in a series of projects focused on the economic and environmental value of outdoor amenities, which we describe as the return on environment. Looking forward, we are seeking partners and collaborators interested in better understanding and documenting how a sense of livability is impacting the ability of cities to attract businesses and workers in this new reality that communities face. To do that ESI Center for the Future of Cities has developed a research focus area in Accessible Quality of Place. Connect with ESI Principal Gina Lavery for more information on how to get involved.

Smarter Cities, Post COVID

In the years prior to COVID, cities were beginning to scale up their efforts to adopt new technologies to operate more efficiently, reduce operating costs, and begin to address core issues of sustainability. In particular, larger cities and more prosperous cities were leading the way, as they had the resources and the technology foundations to build out smart city platforms.

The pandemic accelerated the need for adoption of smart technologies, not just for the biggest and most well off, but for medium-sized and smaller communities as well. Connectivity, not just between government agencies, but between the government and their citizens, has moved from a luxury to a necessity in rapid times. And that acceleration has helped to identify gaps that must be filled to meet new demand. Some examples include:

  • Internet access and affordability is crucial to the future of cities, both because of the increase in working and learning from home environments requiring on-line access, but also to deliver public and private services to citizens, such as online permitting and tax payments, but also telehealth for both physical and mental health care. Communities are in the midst of planning for new broadband investments, fueled by the federal infrastructure bill, Rescue Plan funding, and private investment in fiber and 5G.
  • An increased focus on sustainability and the long-term environmental cost of fossil fuels has led to an increased interest and public focus on increasing the number and availability of electric vehicles. However, there remain challenges in how cities adapt to this new reality. Many communities are not designed in a way to make electric vehicle charging infrastructure easily accessible to all residents, leading to concerns over future EV equity issues affecting low and moderate income households.
  • Changing work requirements and locations have resulted in dramatic disruption of commuting patterns have led to a need for innovation by transit agencies, as they seek to rebuild ridership in new and creative ways. Whether it is redesigning route systems, investing in new technology to allow for real time rider information, or designing new and innovative commuter pass models for businesses seeking to support employees return to work, smart transit will be a necessity for systems to regain ridership and financial sustainability.

Building on ESI’s groundbreaking smart cities research through its prior thought leadership initiative, ESI Center for the Future of Cities is launching a research focus on how cities and communities of all sizes are reimagining what it means to be a “smart city”. To learn more about how you can be involved, connect with ESI Principal Steve Wray.

Supporting Equitable Economies

COVID was not the only factor that has disrupted and fundamentally changed cities over the past two and a half years. The civil unrest in cities that followed the George Floyd murder created a new urgency for addressing centuries-old patterns of racial discrimination, segregation, and economic inequity. Business and governmental leaders have pledged to create new vehicles for investment in cities, and to develop partners and intermediaries to build new models for minority business development and growth.

Cities have always competed with each other as places of human expression, cultural exchange, and commerce. An important way that future cities will compete is as inclusive entrepreneurial ecosystems. This is true for two reasons. First, in our global knowledge economy, regions compete through innovation. Second, innovation requires diversity and intensity of interaction.

While innovation can emerge from anywhere in the world, cities represent an important location because of the possibility cities offer to gather people at scale, colliding together new insights and disparate perspectives to inch our way to breakthrough. That is, after all, the fundamental value proposition of cities, that concentrations of people create a virtuous cycle of discourse birthing new ideas, compelling more people and money to flow in, leading to still more engagement and energy and innovation.

But unlocking that value proposition takes hard and intentional work. For innovation cannot happen when entire groups are systematically excluded from making contributions and reaping the benefits based on race, ethnicity, sex, or income level. Unfortunately, there remains far too much disparity in access, resources, and opportunity in cities across the country, the legacy of historical injustices whose systemic influences carry into the present.

Thus, cities that fail to recognize and address the barriers that keep all entrepreneurs from succeeding will not only be less equitable places but also less successful places. Conversely, cities that desire to thrive in the future need to understand how to create inclusive entrepreneurial ecosystems.

Building on ESI’s work with economic development organizations, universities and hospitals, and local governments, ESI has built a research agenda focused on better understanding inclusive environmental ecosystems that help promote jobs and investment in new and exciting ways. Connect with ESI President and Principal Lee Huang to learn how you can get involved.

Stay Tuned

As you can see, we are excited about the future of cities, and see real opportunity for employing ESI’s unique combination of urban economic analysis and thought leadership to these challenges and more. If you are interested in any of these topics or have other ideas for working with Econsult Solutions and ESI Center for the Future of Cities, please connect with Steve Wray  or Mike Daly  and we will be glad to follow-up.

 

 

Steve Wray, Senior Vice President & Principal | wray@econsultsolutions.com

Steve Wray is a senior vice president and principal at Econsult Solutions. In this role, Steve focuses on the development and implementation of programs and projects that support ESI’s vision and short- and long-term plans.

He leads the work of the firm’s principals and senior staff in developing new partnerships, expanding and building on existing practice areas, and integrating the firm’s strengths in economic analysis and thought leadership. Mr. Wray joined ESI in 2017 as a Director and was promoted to Vice President, Strategic Initiatives in 2019.

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