In the new global landscape of working from home, some cities are serious about attracting the remote workforce.
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Ideas
April 21, 2022 9:50 AM EDT
Glenn is an entrepreneur, venture capital investor, business consultant and adjunct professor of entrepreneurship at New York University and the City University of New York.

The largest, and by some measures the most passenger-friendly station in Europe, is in Leipzig, Germany, a cosmopolitan city of nearly 600,000 people in the Eastern German state of Saxony. Despite being lauded as the “new Berlin” and one of Germany’s fastest-growing cities, Leipzig’s global reputation is still catching up to its European one. I hadn’t heard much about it before my arrival there in October as part of a transatlantic delegation of experts studying the future of cities.

Walking through Leipzig’s retail and restaurant-adorned city center, you might easily overlook the fact that the city, roughly thirty years after German reunification, has a remarkable history of urban revival. The former industrial center, which lost nearly 20% of its population between 1988 and 1998, has been remade as an artistic, academic, and commercial hub.

Over several days there on bike tours, during meetings with city officials, and while speaking with local activists and entrepreneurs, I kept asking myself the question, “Would I want to live here?”

Freed from the constraints of the office since the beginning of the pandemic, many executives, entrepreneurs, and recent college graduates are asking themselves the same question about cities all over the globe.

What began with tech-obsessed myths about the death of San Francisco, the rise of Miami, and the exodus from cities, has become a fundamental disruption of the relationship between geography and the workplace. Cities have rebounded and the data shows that remote work isn’t going anywhere. Knowledge workers, who are increasingly demanding the ability to work from anywhere, will soon have a literal world of options of places to live.

From Leipzig to Lagos, cities that are serious about attracting the remote workforce of 2030 and beyond, need to start focusing on building better transportation systems, a dense and responsive housing supply, and investing in social infrastructure.

Invest in more transit options

Cities hoping to attract remote workers ought to invest in efficient, accessible, multi-modal and sustainable ways to move people around. It’s both desirable and profitable. The American Public Transportation Association projects that every $1 invested in public transit nets $4 in returns. “Ease of getting around” and “public transportation options” were among the primary factors young millennials considered when choosing a place to live, a 2013 study by the Transportation Research Board found.

For big cities, most of that burden is carried by rapid transit systems such as the Shanghai Metro and the Tokyo Metro, which carry a combined 16 million riders per day. A 2018 McKinsey study ranked overall transit systems on availability, affordability, efficiency, convenience, and sustainability. Singapore topped the list with Paris, Hong Kong, London, and Madrid rounding out the top five.

The next best alternative to a metro is a bus rapid transit (BRT) system, which uses dedicated lanes and a network of lines and stations to mimic metros. The world’s best BRT systems are in Guadalajara, Mexico, Curitiba, Brazil and Guangzhou, China according to the Institute for Transportation and Development Policy.

Make it better for bikers

Beyond public transportation, cities should make streets less congested and more bikeable. Too few urban areas employ congestion pricing, which charges vehicles to drive in parts of cities, despite evidence that it reduces commute times. Singapore, London, Stockholm, and Milan have successful systems. In each of these cities, congestion pricing revenue is reinvested back in transit infrastructure, reinforcing the financial sustainability of the overall system. Congestion pricing also calms traffic, increasing the safety of biking. It’s linked with lower congestion in a 2019 list of the 20 most bike-friendly cities in the world. The list is dominated by cities in Europe, with Copenhagen and Amsterdam at the top. Bogota is the only South American city on the list, while Tokyo and Taipei represent Asia. Vancouver is the lone North American city.

Build dense, affordable housing

Few regions have attracted human talent over the last 30 years like the San Francisco Bay Area, whose culture of innovation and entrepreneurship make it not only a model for growth but also housing unaffordability. Since 1990, the Bay Area has added only one unit of housing for every two jobs created. By 2015, the area’s three major cities, San Francisco, San Jose, and Oakland, had the U.S.’s highest, fourth-highest, and sixth-highest rents, respectively. But the Bay Area isn’t alone. The Lincoln Institute of Land Policy analyzed a sample of 200 cities and found that 90% had average home prices that were more than three times the average income of residents.

Cities hoping to become remote-talent magnets need ample, affordable, densely-built housing, where supply is responsive to demand. Density, preferred by millennials and Gen-X, is beneficial because it has been shown to lower per capita carbon footprints, decrease infrastructure costs, and increase proximity to retail, food, and entertainment–a driving force behind where young people choose to live. Affordability is even more important for remote workers, who spend a larger percentage of their incomes on housing.

One model of density and affordability is Singapore, whose densely built, government-subsidized high rise social housing system has produced one of the world’s highest homeownership rates.

Invest in amenities and fun

There’s an adage that everyone should live in New York City in their 20s. In the U.S., it’s a favorite destination amongst college graduates. Part of what makes the city such a draw is its “social infrastructure,” the social conditions and amenities–from entertainment and restaurants, to diversity and nightlife.

The smartest cities start with socioeconomic and cultural diversity. Research shows that racially diverse neighborhoods have higher productivity and economic growth and are linked with “prosocial behavior” including a greater willingness to help others. Racially and economically inclusive regions have “higher average incomes and educational attainment and lower homicide rates.” Among major cities, Miami, at 58 percent, has the highest share of foreign-born residents, followed by Toronto, Sydney, and Vancouver.

It would be wrong to ignore the most pressing social complexities that many cities face. They’re grappling with major challenges around homelessness, crime and policing, education, and more. Still, for younger and more geographically-mobile workers, a city’s greatest asset can be access to fun. The last decade has seen the rise of the “night mayor.” More than 40 cities around the globe, from Amsterdam to Toronto, have tasked city officials with improving their city’s nightlife, which is positively correlated with tourism and foreign direct investment, according to Resonance, a Vancouver-based branding consultancy. Focusing on the night economy has produced experimental 24-hour districts and reduced burdensome nightlife regulations. Leipzig, for example, abolished closing times for nightclubs in 2018.

Cities don’t need to have the natural advantages or resources of New York, London or Singapore to attract workers. People who are free to live anywhere will choose a location based on a host of variables. But while officials can’t make their cities more attractive by changing the number of days of sunshine or their proximity to the mountains, they can–and should–build a dense, responsive housing supply, focus on multi-modal transportation, and invest in fun.

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