Tag Archive for: remote work

Downtown San Francisco is Beyond Redemption

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The recent announcement that Ian Jacobs, a scion of the famous Toronto-based Reichmann real estate clan, was coming to buy upwards of $900 million of San Francisco real estate, has offered the beleaguered California city a rare moment of hope. Some suggest that we could see a repeat of New York’s recovery from its nadir in the 1970s, during which the Reichmanns made a fortune gobbling up depressed buildings shortly before the city’s resurgence.

Yet any effort to restore San Francisco’s appeal will need more than an infusion of vulture capital. The city’s problems are essentially demographic and political, and have transformed San Francisco from an icon to a disaster zone, particularly as workers opt for remote work. The city’s office vacancy rate continues to rise, now surpassing 35%, the highest in its history.

To be sure, San Francisco has been losing its middle class for decades, replaced initially by young single people, many of whom are tied to the tech industry. But as early as 2015, the city began losing net domestic migrants as growth shifted to the further exurbs.

Since the pandemic, the city’s population has dropped and its social problems, long festering, have become a running sore. That’s likely why up to 10% of San Francisco’s residents have left the city — far more than in New York. “A lot of people have had it,” Heather Gonzalez, a longtime Democratic activist and mother of two, told me. “We have had neighbours and an elderly grandfather beat up on a bus and my kids have to watch people poop in public on Market Street. This is what we have to go through.”

Yet there is some hope, Gonzalez suggests. She points to the recent recall of ultra progressives including the District Attorney and three school board members. There’s also been a concerted effort by moderate Democrats to root the radical Left’s hold on the party as well as an effort to replace several far-Left members of the Board of Supervisors.

Amid a severe budget deficit, these efforts are critical. The city’s understaffed police department is almost certain to lose the battle for resources with the city’s dominant and fervently Leftist public employee unions. That the city now suffers the second highest violent crime rate in California illustrates just how important this battle is.

These reform efforts finally have some backing now from the tech oligarchs, who in recent years have been indifferent or even supportive of the progressive agenda. This has roiled the Left-wing activists who see any movement backed by the billionaire class as a hostile takeover.

Yet even if the city somehow regains its ballast, Reichman may be looking at the wrong places to invest. Although the office market may recover, the movement of business out of the state continues in a way far more profound than in New York back in the 1970s.

Read the rest of this piece at UnHerd.

Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Homepage photo: Ken Lund, via Flickr under CC 2.5 License.

How to Shrink a Fortune

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For generations, millions have come to California to make their fortunes, relying on the state’s own seemingly limitless fortune of natural resources, favorable climate, and economic opportunity. But now California’s longstanding identity as the nation’s leading innovator, wealth-builder, and aspirational locale is threatened. Read more

Report: Building the New America

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This new report examines the housing trends that are driving today’s migration of people and jobs, and suggests a urban strategy that better fits the aspirations of most Americans. Below is a summary of the report and a link to download the full report:

For generations Americans have voted with their feet—and their dollars—to achieve what has long been called “the dream,” namely, a home of their own, usually in a low- to mid-density community. This preference has existed for decades, and despite media assertions of a generational shift back to dense, urban living, the statistical evidence shows quite the opposite.

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A Lesson on California Housing from the Billionaires Planning a New City

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A cadre of Silicon Valley elites is drawing fierce criticism from local residents and environmentalists for planning a new city on the outskirts of the Bay Area, a project dubbed “California Forever.” Read more

Whatever Happened to the Great West Coast Cities?

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As recently as the early Nineties, when the great cities of the Midwest and East Coast were careening toward what seemed like an inevitable downturn, the urban agglomerations along the Pacific coast offered a demonstrably brighter urban future. From San Diego to the Puget Sound, urban centers along America’s western edge continued to thrive and expand as migrants from other parts of the country, and the world, crowded in.

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The Death of the Great American City

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The King of Wall Street has spoken, but the peasants are not listening. Ever since the end of the lockdowns, JPMorgan Chase CEO Jamie Dimon, like many of his elite counterparts in cities from New York to Seattle, has been calling for the workers to return to their cubicles and daily commutes. Read more

Feudal Future Podcast: The Future of Work

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On this episode of Feudal Future, hosts Joel Kotkin and Marshall Toplansky are joined by American writer, Michael Lind, to discuss the future of work.

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What Really Divides America

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For almost a decade, the West has been engaged in a deepening conflict. Sometimes it flares up as a political debate; sometimes as a culture war. But whatever form it takes, it is inevitably framed as a disagreement between classes, races or ideologies.

This is a mistake. Demography may be destiny, but it is geography that determines its political shape. The greatest division today is to do with place: in particular, three basic terroirs — urban, suburban and rural — which reflect a divergence in economic interest, family structure and basic values, particularly between big city economies and those on the periphery.

This fracture is widening at a time when the demographic balance between these regions is shifting. For much of the past two centuries, the overwhelming inclination was towards urbanisation, with dense cores serving as the prime engines of economic, cultural and social change. Today, however, that pattern is shifting, particularly since the pandemic, which saw two million citizens move out of big US cities. Even in urban-oriented Europe, 63% of cities experienced a population decline during the pandemic.

Does this mean “the era of urban supremacy is over”, as the New York Times put it? Quite possibly. But don’t expect the urban leadership to acknowledge it. Even as they desperately attempt (and largely fail) to lure workers back downtown, urban political interests continue to dominate the national conversation — even amid high levels of crime, street-level disorder and the resulting shuttering of businesses.

Largely ignored by the city-dominated media, the world’s urban core has been losing this battle for generations. This is not only evident in the United States, but also across Europe and Australia. According to the Australian Bureau of Statistics, little more than 5% of growth from 1966 to 2021 was in the core cities. In Europe, barely 37% of people live in cities, with the rest in fast-growing suburbs, small towns and rural areas.

Of course, many cities have experienced some revival over the past decade, but that “boom” has largely benefited educated newcomers and their wealthy employers. Urban regions became both richer and poorer; according to Pew research, the greatest inequality in America now exists in “superstar cities”, such as San Francisco, New York, Los Angeles and San Jose.

These shifts have, unsurprisingly, shaped urban politics. As middle-class families have left, the urban terroir has been gutted of the old urban bulwark of solid middle and working-class families; as Fred Siegel has observed, it is dominated by an “upstairs/downstairs” coalition of the affluent and dependent.

This demographic reality has driven a shift towards a more progressive politics. In 1984, for example, Ronald Reagan won 31% of the vote in San Francisco and 27.4% in Manhattan. In 2016, Donald Trump won only 10% of the vote in each. Between 1998 and 2018, urban counties — which sometimes includes suburbs — went from 55% to 62% Democratic. Today, there is not a single Republican Mayor of a city of more than one million people. Recent victories of progressives in Los Angeles, Oakland, Chicago, New York and Minneapolis, despite widespread social disorder and economic decline, suggest this pattern may well be inexorable.

Read the rest of this piece at UnHerd.

Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Photo: David Clow Flickr under CC 2.0 License.

The Future of Cities: False Dawn – The Future of Work and Cities After the Illusions of Globalizat …

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The disruption of the COVID-19 pandemic, the rise of remote work, and partial de-globalization have shattered neoliberal narratives about the future of work and cities. A consensus about what will replace it has yet to emerge.

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Things Are Different Downtown

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We are entering a new urban epoch, with the potential to disrupt city life in ways not unlike that created in the shift from an industrial to what Jean Gottman described in 1983 as the “transactional city.” Based on finance, high-end business services and information technology, transactional cities were defined not by production and trade in physical goods, but by intangible products concocted in soaring office towers.

For years, academic researchers, both on the Left and Right, envisioned a high-tech economic future dominated by dense urban areas. Yet when viewed through the lens of migration and employment, London, New York, San Francisco, Chicago, and Los Angeles have all been suffering relative declines for at least the last decade. The ultra-tall towers that once symbolized urban greatness are now as anachronistic as the Cathedrals of the Middle Ages. Office occupancy has been declining since the turn of the century, while construction of new space has also fallen. In 2019, before the pandemic, construction was one-third the rate of 1985 and half that of 2000.

More serious still has been the movement of people. Migration to dense cities, already a small share of all moves, started to decline as early as 2015.  But it accelerated during the pandemic. Dense centers — what historian William McNeil described as the “confluence of the civilized disease pools” — have historically suffered the worst during pandemics. Ancient Rome did, as did the great cities of the Renaissance, the Islamic Caliphate, and China. During the COVID-19 pandemic, the dense urban centers of today met the same fate, suffering generally the worst fatality rates.

Migration to dense cities, already a small share of all moves, started to decline as early as 2015. But it accelerated during the pandemic.

The pandemic clearly accelerated a devastating rise in crime and lawlessness, perhaps most notably in London, Paris, Washington, New York, Los Angeles, San Francisco, Philadelphia and Chicago. In some parts of Chicago and Philadelphia, young men now have a greater chance of being killed by firearms than the American soldiers who served during the wars in Afghanistan and Iraq.

Yet it is misleading to blame this on the pandemic alone. Indeed, despite the pre-COVID talk of people moving “back-to-the-city,” suburbs have accounted for about 90% of all metropolitan growth in the United States since 2010, gaining 2 million net domestic migrants, while the urban core counties lost 2.7 million. This process is likely to be impacted over the long term as more workers choose to work at home, at least two to three days a week. Stanford economist Nicholas Bloom has suggested that even after the pandemic, remote workers will constitute at least 20 percent of the workforce, more than three times the pre-pandemic rate.

All this accentuates a mounting crisis for urban governance. Even before the pandemic the transactional city had undermined the middle and working class as costs rose, schools deteriorated, and regulation flourished. Cities like New York, London, and Paris may continue to attract the ultra-rich who buy properties there, even if they live there only intermittently. But they are steadily losing the middle class.

Read the rest of this piece at The Ripon Forum.

Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.

Homepage photo: Sean Pollock, via Unsplash