Effects of COVID-19: Cities
I’m watching and learning from global reaction to the spread of the COVID-19 pandemic. There’s no doubt that some countries have handled it better than others. Some have also had some “nasty surprises” …
The time for “blame games” and recriminations will come later; let’s first learn from the different types of “fallout” we’ve seen. My first article was on “Social Fallout”. After that I wrote about “Supply Chain Fallout”. Travel & Tourism came next, followed by a closer look at the Garment Industry. Then Leadership & Administration, followed by IT and Security implications. Academic fallout came next, then Economic fallout. One aspect that will have impacted many s the effect on cities.
You either love or hate cities. Some people couldn’t live anywhere else except, say, London. Others would far rather live in the countryside. Economists see cities as huge contributors to national budgets and economies. They’re where people can be close to other people with skills, ideas, finance, all the tools necessary to start a business, finance it, trade one’s goods or services abroad and seek professional advice. This is where people learn to live in a modern, open society and where citizens are created (think of it: “citizen” is a combination of “denizen” and “city”).
Cities survive. For example, in the more recent past they have survived a dotcom crash, a financial crisis, terrorist attacks and political populism. London alone has survived the Bubonic Plague, Great Fire, the “blitz” of WWII and terror attacks. Now cities face a massive challenge to what they thrive on - their busy offices, streets, restaurants and theatres. These are quiet or closed - a loss for urban consumers and a catastrophe for the many people who sell services there. Even in London during the “blitz”, life carried on. With COVID-19, businesses are closed, and people are obliged to self-isolate (although restrictions are now being loosened).
The initial effects will be a weakening in property markets (both commercial and residential) as jobs move out of cities, even if only part-time. As it is, we see more cases of working from home forced on us by self-isolation rules; both businesses and individuals are finding that, depending on the job one has, a lot of the work can actually be done from home.
Any business relying on people to come in (e.g. high-street shops, cafés) will suffer or even go under as they adjust. Indeed, the likes of H&M have refused to pay rent due to the fall in office workers, tourists and students coming through their doors.
Due to plummeting activity, cities will suffer financially as income from the likes of taxes on hotels, restaurants, businesses, transport vanishes.
COVID-19 has hit hardest the world’s most exciting cities - the ones we see on the sides of souvenir shopping bags. These also contain high concentrations of infections. As an example, New York, with 3% of America’s population, has seen 19% of deaths attributable to the disease. One in four deaths in France occurred in Paris and its region. Even as lockdowns lift, international travel restrictions and fear of infection will linger: London is only 15% as busy as normal.
The virus has attacked the very essence of what makes cities vibrant and successful. They prosper not necessarily because of what they do for businesses, but because they bring together talented people bursting with ideas. Americans in cities with more than 1m people are 50% more productive than those elsewhere.
Cities remain invaluable as places where people can build networks and learn how to collaborate. The workers now logging into Zoom meetings from commuter towns and country cottages can do their jobs because they formed relationships and absorbed corporate cultures in corporate offices. Spiritually, they’re still in the city, even if they aren’t physically. Even a socially distanced, half-full office is essential for teaching new hires how a company works. If offices facilitate chit-chat and gossip, they are functioning well. Answering emails can be done from home.
Cities need to look to how they function after COVID-19. They are struggling with how to move millions of people when nobody wants to cram into crowded buses and trains. Some are looking at expanding their network of bike paths and have erected plastic barriers to enforce social distancing. This is encouraging. But cities that fear commuters will drop trains and buses for private cars, clogging the roads, would do even better to manage demand by pricing driving and parking more highly (as London is doing now).
Cities will need the independence to “manage their own show”. An example is Seoul’s virus-busting response organised mainly by the metropolitan government and by local officials. London’s mayor who begged for the government to insist on face masks on public transport saw them agree too late.
The best-placed to manage cities are the cities themselves. They should be allowed to impose their own measures on the understanding that, if they get it wrong, national government will intervene.
I’ve spent more than half my life delivering change in different world markets from the most developed to “emerging” economies. With more than 20 years in international financial services around the world running different operations and lending businesses, I started my own Consultancy to provide solutions for improving performance, productivity and risk management. I work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by email. My website provides a full picture of my portfolio of services. For strategic questions that you should be asking yourself, follow me at @wkm610.
Labels: Crisis Management, Leadership, Social, Strategy
posted by William Martin @ 12:55
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