The CBD isn’t dead: workers will return to the inner city but work looks different now

Our inner cities, our central business districts are suffering during the pandemic, aren't they?

High vacancy rates, people working from home, no major events — you've heard all the arguments of why the CBD is suffering.

So, should we just lock up the towers and let nature take over,? Think of Will Smith in 'I am Legend' and the green New York in the movie?

I don't think we should go that far just yet.

If we think about the future of the CBD, we will see that the function of work that is occurring in the CBD is changing.

Why did we cluster jobs in the CBD in the first place?

Simply because the workforce shifted from an industrial society, from manufacturing industries towards knowledge work.

Knowledge work jobs like to cluster: a banker needs to be next to an accountant, needs to be next to clients, needs to be next to the startup environment.

All of those jobs really benefit from being next to one another.

So what happened during the epidemic?

All of a sudden workers worked from home and this actually worked quite well for quite a few people.

So, are we going to stay away from the CBD forever?

No, we won't.m

That's because as the nature of work is changing we need to think about the kind of tasks that we have in any given knowledge workshop and where this task is best to be done.

Think of all the tasks that you do in your job, in your knowledge worker job, there's a certain percentage whatever is that is collaborative in nature, where you need to work together with a teammate and you just brainstorm on a whiteboard, it's really beneficial to set together and plan things.

This kind of collaborative task should take place in some sort of shared space, ideally a central space, and the CBD is a great place to do so.

But there are all those, not interpersonal tasks, where you just write an email, you play with PowerPoint, you analyze an Excel spreadsheet — all of those tasks are better done at home.

If you see any worker in an open-space office with their noise-canceling headphones on, suffering from being annoyed by all this noise that is not helping anyone -  this kind of work should be done at home.

And in the future, we will see a larger share of working tasks falling in the interpersonal category simply because we do know that AI (automation) is taking over certain tasks.

And the last task that is going to be taken over by technology is the interpersonal tasks, if at all.

So that means that we will see a return of the necessity to go to the office.

So we have this workweek ideally if it's manageable, that is split into two halves: you do interpersonal tasks at the office, your commute to the CBD, one day, two, three, four days for week, whatever your individual week requires.

And you do the quiet thinking, deliberative, silent work in the quiet of your study at home, and then it shifts.

Overall this will mean that we have compared the pre-pandemic levels, that we have fewer people in the CBD.

So, the CBD needs a bit of time to get back up to pre-pandemic levels but this should eventually happen in Australia as we plan to take the populations of Melbourne and Sydney from 5 to 7 million people and plan to do so rather quickly.

That's when we'll get a workforce that is large enough in the CBD to fill all those office spaces.

So when will the CBD recover?

2024? A couple of reports say that it will be 2026 or maybe 2027.

I don't really care about this!

And I can say this because I don't have billions of dollars invested into towers in the CBD, so I'm just talking about this from an intellectual perspective.

But that is the way how we will ideally separate work, and that also means that CBD needs to reinvent itself.

That the office of the future needs to look different, that you have more collaborative flexible spaces, fewer workstations, and then you will see more and more workers in the CBD who are out and are not actually in their office, who are meeting clients, colleagues in cafes.

So the CBD will be a much more social space when people go there, simply because they already go there to socialise.

So if an old-fashioned pre-pandemic boss walks through their office, they might think it's mayhem where absolutely nobody does any work but that's not the case:

The real work, the deliberative quiet thinking work will be done at home.

About Simon Kuestenmacher Simon Kuestenmacher is one of Australia’s leading demographers, co-founder of The Demographics Group, a regular media commentator, a columnist for the Australian and one of the world’s Top 50 Influencers in Data Science.
www.SimonKuestenmacher.com