Real Estate Industry News

As the United States and the world battle the stubborn Covid-19 virus, urbanists wonder how much the pandemic will change cities.  Although some have said “cities as we know them will be changed forever,” other analysts don’t envision such sweeping changes.

Two important recent discussions don’t see a massive urban restructuring, even while recognizing the potential for long-lasting pandemic impacts.  Cities will remain at the center of our global economy.  But the pandemic will hit different industries and parts of the workforce unevenly, with consequences for cities’ economic and social health, and inequality.

The Milken Institute’s recent global conference in Los Angeles featured a fascinating discussion of these issues.  Experts, including LA Mayor Eric Garcetti, argued that the pandemic’s duration is altering how businesses and people view traditional urban downtowns and density.

Garcetti noted LA, like other cities, has recaptured some street space from cars, converting it to dining and other outdoor activity.  UCLA Chancellor Gene Block said research is now finding “social scarring” from pandemic fears, which is “changing people’s behavior and how they feel about density.”

Of course, contagious disease and pandemics always have haunted cities.  Disease can spread more rapidly among denser populations, and because cities are vectors for trade and population mixing, exotic infections can be transported into them with disastrous results.

MORE FOR YOU

An important new book from economists Edward Glaeser and David Cutler, Survival of the City, details this history.  Classical Athens lost the Peloponnesian War not because of military inferiority, but because a deadly plague killed perhaps ”25% of the city’s population” while under siege from Sparta.  The Byzantine Empire was substantially weakened by the “Plague of Justinian” starting in 541 CE, with impacts on Constantinople spreading to Rome and increasing their vulnerability to invasion and decline.

And bubonic plague—the “Black Death”— killed up to 50% of Europe’s population in the middle 1300s. Carried by rats and fleas on ships, it spread through European cities and trade routes. 50% or more of the population died in Paris, Florence, Hamburg, and other major cities, with lasting impacts on political stability, economic growth, wages, and wealth.

It wasn’t until the 19th century that cities got infectious diseases under control, largely through novel public health measures including sanitation and clean water, which helped control water-borne diseases like cholera and typhoid.  Urban economist Glaeser says (somewhat dramatically) that “only in the past century have cities ceased to be killing fields.”  The creation of public health departments and other government policies also were central to improving health and urban economies.  

Controlling epidemic disease was critical to the Industrial Revolution’s economic growth.  And cities were central to that growth, as growing populations provided agglomerations of workforces and businesses and customers.  This created large, dense markets, which in turn spurred innovation in products and services, concentration of capital investment, increased division of labor and worker skills, and further economic growth. 

So a pandemic that fundamentally disrupted cities would have significant negative consequences for the economy and our future well-being.  But although Covid-19 is a terrible tragedy for those who suffer and die (and their loved ones), and also is exacerbating America’s already inexcusable inequality, the numbers aren’t anything like the massive plagues of earlier centuries. 

One way to gauge the pandemic’s impact comes from how public health experts measure “excess deaths.” That’s an increase in deaths going above the trend line of previous years, due to some major event or change, like a pandemic.

On that score, while Covid-19 has been a terrible tragedy with its impacts hitting poor, nonwhite, and vulnerable people the hardest, overall unexpected deaths aren’t a staggering number.  As of early September, the USA had recorded 735,802 excess deaths over trend.

That’s a big number, around the total 2021 population of Denver, Colorado.  But so far it is only around 0.2% of our population (about two in every thousand), with deaths concentrated among older people.  For comparison’s sake, the 1918-1919 influenza epidemic killed around 675,000 people in the USA, around 0.64 percent of that era’s smaller population—“a little more than six in every thousand people.”

We continue to suffer too many deaths from Covid-19.  Increasingly, these are driven by political resistance to vaccinations and proper public health measures, mostly in Republican-led states.  (The New York Times reports that “almost every reliably blue state now has a higher vaccination rate than almost every reliably red state.”)

But if excess death numbers aren’t on the scale of previous pandemics, why do some think the pandemic could reshape city economies, the engine driving our economic innovation and growth?  My next blog will look at this in detail, highlighting the industries and jobs most affected by Covid-19, and what that might mean for the future of urban economies.

Full coverage and live updates on the Coronavirus