This spring we published the optimistically titled Why Face-to-Face Still Matters: The Persistent Power of Cities in the Post-Pandemic Era. This book draws on research into what makes cities so vital to the modern economy, including interviews with players – old and young, senior and junior – from a wide range of Central London activities.
With the prospect of an eventual loosening of the pandemic’s grip, it seems worth asking what the long-term impacts on urban life are likely to be. There has been a mass of prognostication over the last twelve months covering working from home (rebranded as WFH), the impact on commuting and the future of central-city offices. Much of this caveated with a ‘things will never be the same again’ slant. Over time, counter-balancing assertions that ‘things will be remarkably like they were before’ have begun to emerge. As France’s economy minister, Jean-Yves Le Drian, said: My worry is that the world ‘after’ will be terribly like the world before, only worse’.
After over a year of Covid-19, and coming in the wake of a slew of forecasts of urban economies’ vulnerability to the impacts of digitisation and, in particular, artificial intelligence (AI) – is the death of the city imminent?
Why cities will still matter
Cities were the future at the start of 2020. And they’re still the future at the start of 2021. Why is this? There are several closely-linked reasons. Our work shows that modern high-added-value businesses will still need high-intensity central places, which are busy, well-connected, and hyper-convenient. These organisations operate in what are called ‘opaque’ markets, uncertain settings with a heavy reliance on judgement rather than calculation. These organisations need to manage risk, to understand clients and be understood by them, and to make business decisions on a basis of confidence, not certainty. Face-to-face (F2F) contact is a core component of those judgements.
Not only that, but they are also choosing central cities for reasons of internal coherence. Our interviews suggested that a surprising amount of Central London’s F2F is internal to firms i.e. building confidence in your co-workers, motivating the team, and keeping things on track.
F2F is particularly valuable for the transfer of tacit knowledge – what is understood or can be inferred thanks to shared frames of reference, but rarely said. Transactional exchanges can rely on ICT. However, for insight and knowledge F2F will always have the edge because it offers unparalleled speed, quality, reciprocity, and the broader clues of body language. This makes F2F critical to building relationships in a world where competition is as much about affinity as about competence.
What digital does change is our reliance on the office as our home away from home. In place of the boardroom, a wide range of neutral venues like hotel lobbies, co-working break-out spaces, and the more spacious but less functional cafe-restaurants, have become essential places for the ‘not random, but not by accident either’ encounters that seem to be such an important piece of 21st century working life.
So what will change?
We are not saying ‘it’ll be all be back to as-before’, but we think it’s helpful to put Covid-19 in context. The pandemic accelerated trends already underway, it didn’t create them. Our argument is that the experience will bring forward an already-existing long-term shift towards flexible working patterns because so many have seen that the technology works and that existing patterns of work no longer need to be taken for granted. As the chairman of Next said recently: “History has been given a shove and, having moved forward, seems unlikely to reverse”.
Without wanting to be too determinist, ‘tech’ has been shoving at history – and cities – for over 200 years, ever since coal, steam, and capital launched the first Industrial Revolution. The repercussions for existing industries in the Midlands and North were profound, but a vast number of new types of work were also created in the rapidly-growing urban areas.
Similar debates can be around with AI. Before the pandemic was ‘going to change everything’, it was AI that was ‘going to change everything’. It’s certainly true that AI is penetrating ever-further and deeper into white-collar activity and, like that first revolution, it is shaking up job patterns, along with how and where business is done. But no innovation in technology has yet reduced the total number of jobs, even while it has been laying waste to individual sectors. We think that law, banking and insurance are three sectors that will look very different in 10 years’ time, but wherever they need high-level contact, judgement and personal relationships, they will not be relying on AI.
City businesses and city workers are poised, permanently, on an ever-shifting boundary between what must be done in-situ, often F2F, and what can now be digitised, made remote, or off-shored. Our interviews showed how in all sorts of ways these boundaries are continually moving. Recruitment patterns, for example, are now very different from only a decade ago, with both job-seekers and employers far more comfortable with using on-line platforms to both formally and informally make the next move. And ‘face-to-face’ means different things now anyway, when ‘bar chat’ and ‘e-chat’ can be interchangeable for a whole range of gossip and influencing.
WFH for all?
But lots won’t change, or not in such striking ways. Many commentators have predicted that COVID-19 could lead to permanently remote workforces, but the future is likely to be more nuanced. Yes, there have been big changes, but the future workforce will probably be a hybrid construct. The great office centres may indeed shrink over time, and some firms may well combine smaller local offices in key regions – for employees to use if they wish – with a larger HQ retained in a major city. For many, a ‘hub & spoke’ configuration could offer the ideal balance of attracting talented folk wherever they live whilst offering flexibility to the firm overall.
Some care is needed, too, in thinking about what the whole ‘WFH’ phenomenon means. As Paul Sawers pointed out on the VentureBeat site earlier this year, remote working does not necessarily mean the same thing as home working. Both “remote working” and “home working” suggest an individual practice, rather than a coherent company-wide policy. The more long-lasting changes are likely to come, as Sawers suggests, from firms’ strategic adoption of a ‘distributed teams’ approach, with shared workspaces in selected locations around the world.
Thinking about recovery
Our book tries to understand the dynamics of urban change and the way in which markets and business work . We stress the strength and power of the long-run dominance of the great metropolitan labour markets, and so we are firmly not in the ‘it’s all going to be completely different’ camp.
As we say in our book’s final paragraph: “‘Being there’ is still at the core of the urban experience. Even in a world of instant digital access and unparalleled connectivity, central places matter, and face-to-face contact is what they do for a living. That is their story, and it will be their future.”
Jonathan Reades is an Associate Professor in the Centre for Advanced Spatial Analysis at UCL.
Martin Crookston is a strategic planning consultant