Post 16: Adventures in Micromobility - Part 2

Six months ago, I wrote part 1 of what I think will be a three-part series on emerging trends in micromobility.  For those who have forgotten, micromobility is a class of transportation options typically focused on a single person taking a relatively short trip.  Compared with walking, micromobility options are faster and allow trips of greater length.  Compared with driving a car, micromobility options are significantly less expensive and more environmentally friendly.

In part 1 I wrote about e-scooters.  As the weather has improved this spring, I have been out on my personal e-scooter several times and I still find it to be both fun and useful.  In part 2, I’m going to focus on ebikes -- a transportation option that, like scooters, has grown rapidly in popularity over the past 5 to 10 years.

Although I have ridden traditional bikes on and off for most of my life, my experience on ebikes is limited to half a dozen trips on two different types of ebikes over the past couple of weeks.  I am certainly open to feedback from more experienced ebike riders, but it seems to me that an ebike is not so much a new category of transportation as much as it is an enhanced version of an existing category.  Still, the improvement is significant enough that it warrants its own discussion and I think it has the potential to impact urban transportation in a significant way.

As with e-scooters, there is not much reliable data on the number of miles traveled, or even the number of ebikes sold mainly because ebikes are often lumped in with all other bikes and because the ebike industry is changing and growing so rapidly.  A recent article reported that in the United States the sale of bikes generally in 2020 was up 46 percent, but the sale of ebikes was up 140 percent.  And because ebikes are more expensive, the difference in revenue is even greater. (1)   Such numbers can be misleading, however, because the starting base for a new product like ebikes is so small that even a relatively small increase in actual numbers can be a big percentage increase.  In addition, there are several ebike manufacturers that sell exclusively (or at least predominantly) through online channels which bypass many of the traditional bicycle industry groups that gather sales data.

Folding urban ebike from GoCycle

Another way of gauging the growing popularity of ebikes is by their usage in bike sharing programs.  Around the country, bike share systems are rapidly incorporating ebikes into their bike inventory and the result is that ridership numbers are increasing dramatically.  Madison, Wisconsin became the first program to convert entirely to ebikes as of June 2019.  Kansas City’s bike share program has included ebikes for over two years and they now account for roughly two-thirds of their fleet.  Eric Vaughan, Director of Bike Share and Business Services for RideKC Bike, credits ebikes for expanding the range of riders and for increasing the rides per bike within their system. (2)  That assertion is backed up by their ridership data that shows consistent growth for both total rides and ebike usage on a quarter by quarter basis (see chart).  Although most bike share fleets are not entirely ebikes, the move to ebikes is so strong that nearly every bike share system has incorporated them to at least some degree.

My best guess is that in the U.S. ebike sales (in terms of numbers of bikes) probably account for roughly 10 to 15 percent of all bicycle sales.  That number, while still relatively modest, is up from maybe one or two percent just eight to ten years ago, so the growth is definitely real.  As a way of confirming my estimate, I checked the websites for Trek and Specialized -- two of the biggest brands in the U.S.  Both offer a wide array of bikes for a wide variety of purposes and riders.  By my count, Trek offered 47 ebike models out of a total of 272, and Specialized offered 44 ebikes out of a total of 196.  Of course, the number of models offered doesn’t equate directly to sales, but if the big manufacturers are listing 19 percent of their models as ebikes, I’m fairly comfortable with my estimate. 

Another thing to understand about ebikes is that there are two distinct types:  pedal assist and throttle control.  Pedal assist bikes (the more common of the two) link the level of assist from the motor to the effort the rider puts into pedaling.  The harder you pedal, the more assistance you get.  The higher end versions have multiple levels of assist so that you can choose how hard you want to work.  The second type has a throttle on the handlebars to control the motor, independent of whether or not the user is pedaling.  In either case, the bike can be single speed or have multiple gears.

Ebikes are a much bigger deal in Asia and Europe where biking is seen as a serious form of transportation rather than as simply a tool for fitness or recreation, as it tends to be viewed in this country.  In those parts of the globe, ebikes outsell electric cars and may continue to do so for the foreseeable future.  Ebikes have become so popular, in fact, that they are now made and marketed by motorcycle manufacturers such as Harley Davidson, Ducati and Yamaha, and by auto companies such as Porsche, Mercedes Benz and BMW.

My experience on an ebike

My first set of rides was on a 9-speed, pedal assist bike from Giant.  It would probably fall in the middle of the pack in terms of price and it included some nice features like 4 different levels of assist (none, eco, medium and sport).  My second set of rides was on a single-speed, pedal assist bike from the RideKC Bike Share program.  This was a bike designed to be so simple that just about anyone could ride it regardless of skill or intelligence.

So what is it like to ride an ebike?  Pretty much like riding a regular bike except your legs are always fresh, the road is always flat, and a brisk wind is always at your back.  From the perspective of an old guy who tends toward laziness, this is bike riding perfected.  Hardcore bikers probably think people on ebikes are cheating, but I don’t care.

On my first few rides, I tried to simulate a commute to work.  The first was from my home to my old (pre-retirement) workplace.  The roughly 7.5-mile ride took me a little over 30 minutes (on the “medium” assist level) and by the time I arrived I was perspiring a little bit, but if I could have toweled off and changed shirts I would have been fine for the day.  According to my fitness watch, my average heart rate was between 100 and 110 bpm.  For comparison, a similar ride at a similar speed on my regular bike would get my average heart rate over 130, and I would be sweating profusely.

My next ride was roughly the same length but I didn’t push as hard.  My average speed dropped from roughly 15 mph to around 12 mph, but my average heart rate stayed below 100 bpm.  In short, an ebike would easily make me consider it as a viable commuting option.

Bike Share from RideKC Bike

My second set of rides were shorter -- the kind you might take if you were running an errand or meeting a friend for lunch.  Again, I didn’t try to go especially fast (an average of 12 mph) but I was easily able to cover roughly 3 miles in 15 minutes or so.  The bike-share bike was pretty heavily assisted but the gearing was low enough that it was harder to translate that into high speeds.  Given the typical bike-share rider, that is probably very appropriate.  On this set of rides I actually sought out hills as a test and found that even moderately steep hills were a piece of cake.  According to my fitness watch, my heart rate barely broke 100.

Comparison with e-scooters

How does an ebike compare with an e-scooter?  While both are very enjoyable to ride, I have to say that I think the scooter is more fun.  It almost makes you feel like you’re a kid again.  In addition, the compact size and foldable nature of a scooter make it easier to pair with transit.  Many transit systems accommodate bikes to some degree but the added size and weight (particularly for an ebike) make it harder.  Third, e-scooters are considerably less expensive -- like thousands of dollars less expensive.

On the flip side, I felt substantially safer on the ebike, mainly because I felt more visible to drivers and I didn’t have to worry about a random pothole or road irregularity knocking me over.  Secondly, the ebike was definitely the more comfortable option for rides over two or three miles in length.  Third, I would give the edge in speed to the ebike as well.  You can find scooters that go quite fast but I wouldn’t want to ride them except on a nearly perfect trail.  The larger wheels on a bike make speed feel safer and more enjoyable.  Finally, ebikes have a big advantage in cargo capacity.  There are even ebikes made specifically as inner-city delivery vehicles.  The photo below shows my nephew on an ebike that he uses to haul his two kids (and their supplies) to various places and events in San Francisco.

Ebike from Xtracycle

Ebikes as serious urban transportation

In the midwest, biking as a form of transportation (as opposed to recreation) has some serious obstacles to overcome.  To begin with, the spread-out nature of midwestern cities increases the typical distance of each trip to the point where bikes are often perceived as inconvenient or impractical.  In addition, midwestern cities are so dominated by the automobile that riding a bike can feel unsafe, particularly on major streets.  So for many people, the car becomes the default choice for virtually every trip and other options aren’t even considered.

Every city, however, has a group of bike enthusiasts most of whom use bikes as a form of exercise, but who will use them for transportation from time to time.  There are, of course, people who use bikes predominantly as transportation and that group has been growing slowly over time.  The COVID pandemic increased the size of that group at least temporarily, but it is still a relatively small percentage of the population.  The challenge is to increase the number of people that consider bicycles when their only need is to move from one place to another -- a transportation choice just like deciding whether to walk, take the bus, or drive your car.

That is precisely where I see the value of ebikes.  An ebike makes bike riding so easy that it  expands the range of people who will consider riding a bike for something other than recreation.  Older people, for example, who had given up on bike riding because of the effort involved might easily be persuaded to give them another try.  For people who already ride bikes, ebikes offer the ability to expand the range and speed of each bike ride so that the boundaries of what is reasonable suddenly include more possibilities.  Finally, ebikes remove the issue of topography from the decision of whether to ride a bike or what route to take.  The rolling hills that are common throughout the midwest seem to disappear on an ebike -- a feeling that changes the perception of bike riding to an amazing degree.

In addition, ebike manufacturers are producing products in a wide array of prices, styles and functionalities, including niche products that go beyond what traditional bikes have offered.  There appears to be an ebike subculture that is not just converting existing bike riders but bringing new riders into the fold.  The variety of models can accommodate the desires of both traditional and nontraditional bike riders, whether they are looking for something fun, hip, utilitarian or chic.

VanMoof S3

Finally, ebikes still offer health benefits despite the assistance provided by the electric motor.  A study published in the International Journal of Behavioral Nutrition and Physical Activity concluded that e-cycling provided physical activity of at least moderate intensity, less than traditional cycling but more than walking. (3)

The Downside

Despite my enthusiasm, there are several disadvantages that need to be acknowledged.  First and foremost is the issue of price.  Although it is possible to buy an ebike for a little over a thousand dollars, the “sweet spot” for ebikes -- the point where you get both quality construction and a reasonable variety of options -- appears to be between $2,000 and $4,000.  It is certainly possible to spend several thousand dollars more, but that would generally be only for a very specialized product or for the latest and greatest technology.  In terms of quality of construction and components, a $2,500 ebike is roughly equivalent to a $600 to $800 traditional bike.

The second major disadvantage is weight.  The typical commuter-style ebike is likely to weigh 50 to 60 pounds, roughly double the weight of a traditional bike.  From the standpoint of riding, this doesn’t make much difference because the motor more than makes up for the extra weight.  But a bike rider who lives in a third-floor apartment and is used to putting their bike over their shoulder and walking up the steps is going to quickly think about moving to the first floor.  Even putting an ebike on a rack becomes a bit of a chore.

The final disadvantage, figuring out how to store an ebike, is mainly a combination of the first two problems.  Ebikes are expensive enough that you aren’t likely to want to store them overnight or for long periods of time simply chained to a sign post with a WalMart bike lock.  But the weight makes some of the normal bike options (such as putting it in a basement storage locker or an upper floor apartment) more problematic.  In addition, you have to find a way to recharge it on a regular basis.  Many ebikes have removable batteries which makes this easier, but it still can be an issue.

The impact of ebikes

On balance, I think the popularity of ebikes is here to stay and will grow over time.  This is another indicator that cities need to take the role of bicycles seriously as a transportation option.  More bike infrastructure is needed to really make biking as safe as it deserves to be and to encourage people who are on the fence to give biking a try.  In addition, states need to update their laws for all types of micromobility devices so that the regulatory environment keeps pace with the latest technology.

As with other forms of micromobility, pairing ebikes with transit makes a great deal of sense as a solution to the first mile/last mile problem.  This is particularly true with bike share programs which I think will continue to shift their fleets to ebikes and which, in turn, will continue to grow in popularity.  Bike share stations should be increasingly teamed with transit stops and major employers should be partnering with bike share programs to provide employees a healthy and enjoyable way to commute to work.

Thoughts?  As always, share your thoughts and ideas by leaving a comment below or sending me an email at doug@midwesturbanism.com.  Want to be notified whenever I add a new posting?  Send me an email with your name and email address.

Notes:

1. “Now making electric bikes: Car and motorcycle companies”; Roy Furchgott; New York Times; March 2021; https://www.nytimes.com/2021/03/04/business/electric-ebikes-pandemic.html
2. Interview with Eric Vaughan, Director of Bike Share and Business Services; RideKC Bike; April 2021
3. “Health benefits of electrically-assisted cycling: a systematic review”; Jessica E. Bourne, et al; International Journal of Behavioral Nutrition and Physical Activity; November 2018; https://ijbnpa.biomedcentral.com/articles/10.1186/s12966-018-0751-8
4. Special thanks to Susan Crowe for generously sharing her ebike and to Dave and Aaron Johnson who both shared their perspective as bike enthusiasts.

Post 15: Making Work-From-Home Actually Work

 I have to admit that I am a bit of a contrarian.  When everyone starts jumping on the bandwagon, I’m inclined to jump off or at least evaluate the bandwagon with a good deal of skepticism.  The work-from-home bandwagon is a perfect example.

In the past, I have advocated for a broader use of remote work arrangements because technology was moving rapidly in that direction and it is a valuable perk for many people.  But now that the pandemic proved to CEOs that remote work actually works and that it has a number of important benefits, everyone seems to be touting remote work as the best thing since sliced bread.  Trendy tech companies, in particular, seem to be competing with each other to see who can be first to divorce themselves from the office building and marry into the work-from-home mania.  Twitter, Square, Shopify, Slack and many others have announced major initiatives toward remote work as the corporate norm.  Shopify founder and CEO Tobi Lutke apparently went so far as to tweet:  “Office centricity is over.  As of today, Shopify is a digital by default company.” (1)

In 2018, REI -- the outdoor equipment retailer -- started work on an 8-acre corporate campus in Bellevue, Washington.  In keeping with the company culture, the new campus has a very outdoorsy feel with garage-door style walls that can open up to let the outdoors in, and exterior amenities like fire pits and blueberry bogs.  Fast Company called it a “summer camp for grown-ups.” (2)  But recently REI put the never-used campus up for sale and instead is planning for employees to “flex” between working remotely and commuting to one of three smaller satellite offices in the Seattle area.  Interestingly, Facebook is apparently the likely buyer. 

Photo: NBBJ

REI is one of the more extreme examples, but numerous companies have made the same choice to pivot away from offices even as the pandemic winds down and returning to the office is once again possible.  Urban commentators are starting to jump to the conclusion that this is another nail in the coffin of big cities, as remote workers and their trendy employers flee city life for the tranquility of small towns, or the scenic beauty of seaside or mountainside locations.  

It is time, I think, for a sanity check.  Yes, work-from-home is an important, long-term trend that will have a significant impact on cities.  But I think that impact will be different than many people are projecting, and in particular, I don’t think it means that downtown offices and high-rise condo buildings will immediately go dark.  In this post, I’m going to look at what I think “work-from-home” as a long-term trend is really going to be like, and then take a hopefully more nuanced look at the likely impact on cities, especially those in the midwest.

“Back of the Envelope” Projections

The first step is to get some sense of the scale that we are talking about.  Direct comparisons with the past year are misleading because people and companies will put up with a lot that is sub-optimal during a pandemic simply to keep food on the table and revenue coming into corporate coffers.  As the impact of the pandemic fades, not everything that was tolerated during the past year will be continued into the future.  Keep in mind that many jobs cannot be done remotely and many people who could work from home won’t want to if they are given the option.  Some people don’t have the right personality for remote work and others don’t have the right physical environment.

The reality of the post-pandemic workforce is fluid and undefined enough that any projections should be taken with not just one, but multiple grains of salt.  So with that disclaimer, let’s start with the assumption that when employment returns to normal we are talking about 140 to 150 million jobs in the United States.  The best estimates I could find are that somewhat over a third of jobs could feasibly be done remotely.  That means that roughly 50 million jobs could, in theory, be transitioned to a work-from-home approach.

That number, however, overstates the potential impact for two reasons.  First, some of those jobs were already being done remotely before the pandemic and thus don’t represent new work-from-home positions.  Estimates from the Pew Research Center indicate that roughly 20 percent of the potential remote-work jobs were already being done remotely before the pandemic hit (3).  The second reason is that long-term change is hard.  Don’t underestimate the number of managers and corporate leaders who will fall back into the old habits of working from the office and won’t even give their employees the option of working from home.  For the sake of discussion, however, let’s be optimistic and assume the 75% of the jobs that could be done remotely but weren’t already operating in that mode will transition in the future to be available for some type of work-from-home scenario.  That means 50 million jobs, less the ones that were already remote (10 million jobs), times 75% -- which yields roughly 30 million jobs.

Thirty million jobs is certainly not a trivial number, but I’m not really done with our projections.  What both business and employee surveys are making clear is that the work-from-home trend is not necessarily an all or nothing proposition.  It is certainly too early to know for sure, but early indicators are that the clear majority of these jobs are likely to involve what is being referred to as a hybrid work schedule, where some time is spent working remotely from home and some time is spent in the office working much as before.  From the surveys that I have reviewed, my best guess is that roughly two-thirds of potential remote workers will end up on some type of hybrid schedule.  The remaining third will be split between people who opt to work remotely all of the time and those who hate remote work and opt to be in the office all of the time.

The bottom line is that somewhere around 5 million jobs (a little over 3 percent of all jobs) might become 100% remote and thus in a position to leave the city and move to the beach or the mountains.  Of course, some of these people will stay in the city because they like urban living, but they could leave if they wanted.  This is still a big number but when spread across the country it is probably not going to have a huge impact.  I will come back to this point later on, but the other number that needs to be emphasized is that roughly 20 million workers (about 14 percent of the workforce) are likely to be on a hybrid schedule.  If only half of them come into the office on any given day, this is likely to have a bigger impact than those who opt to move out of the city entirely.

The final point for this section is that while these estimates, rough as they are, paint a picture of what things will be like in a post-pandemic world, the trend for the future is clearly toward remote work.  Adapting to the immediate shift is one thing, but cities should anticipate that over time technology will improve and job requirements will change to make more and more jobs subject to work-from-home options.

Impact on Workers

There have been a lot of anecdotal stories about people who feel so much more productive working from home, and many companies have been pleasantly surprised at how productive their employees have been during the pandemic despite the adapt-on-the-fly behavior that managers and employees have been forced into this past year.  Survey results show that reality is more mixed, however, with a significant number of employees struggling to get their work done.  New hires and employees with weaker skills or those unclear on their assignments tend to find working from home stressful.  Being in the office provides informal ways of asking for help that are hard to replicate in a remote setting.  In addition, research seems to indicate that being in a virtual meeting is more stressful and takes more mental concentration than being in an in-person meeting.  Zoom meeting “burnout” may not affect everyone, but it is a real thing. (4)

On the other hand, many people appreciate the extra time that not commuting to work has given them, and the ability to avoid interruptions from co-workers -- particularly those viewed as annoying or disagreeable -- can make time working seem more productive.  Add to that the benefits of having your own kitchen and your own bathroom readily available, and it can make working from home far better than going to the office.

The downside is that many remote workers do not have a work space at home that is anywhere near ideal.  People adapted as best they could, but moving forward it will be less and less acceptable to work from your bedroom or your kitchen counter.  Some people have an office-type space already in their home and many others have found ways to add a permanent desk in an underutilized corner, but that is certainly not universal.  Multiple monitors and high quality desk chairs that were commonplace in the office are often missing for those working at home.  Finally, wi-fi speeds vary widely and can make a huge difference in whether working from home is enjoyable or frustrating.

In essence, employees are effectively subsidizing their employers by providing floor area, office furniture, and network connectivity at their own cost.  Some companies have provided a stipend or bonus to help offset those costs, but that is not universal and probably doesn’t really cover the full cost even when it is available.  For many workers, this may be a reasonable trade-off for the benefits of working from home.  Increased flexibility in personal schedules is particularly valuable to many people.  What needs to happen, in my opinion, is that costs and benefits need to be more explicitly explored by both workers and companies to make sure that the trade-offs which we were forced into during the pandemic are really ideal for the long-term.

The other worker related topic that I think needs further exploration is the dividing line between when you are on the job and when you are not.  For years, this line has been getting fuzzier and fuzzier simply because smartphones made it harder to avoid work phone calls or emails during non-work hours.  But working from home blurs the line even further.  Surveys have shown that the number of meetings, emails and instant messages between the hours of 6 pm and midnight have gone up significantly.  Is that intentional because people are compensating for doing a personal errand during the day or involuntary because people feel guilty if they don’t respond immediately?  If work-from-home is going to be a long-term thing, I think that company policies and the corporate software used for communication and scheduling needs to reinforce the ability to be “off the clock” so that work/life balance is not just a meaningless buzzword. (5)

Perhaps what is needed is the home office version of a Murphy bed.  A piece of furniture that can open up to be your office, complete with whatever monitors, webcams, headsets, files or other work paraphernalia might be needed.  When closed, it would return the room to more of a home setting and be a clear signal to the worker (and his or her family) that work is done for the moment and personal lives should take precedence.  

Impact on Companies

On the surface, it might appear that companies with remote workers are the big winners in this new world of work.  With a significant portion of their workforce working from home, companies should be able to reduce the amount of office space they either own or rent, particularly in high-rent downtown locations.  Think back to the REI example above -- they traded a high-dollar mega-campus for three satellite offices and remote work.  The cost savings will be big, and while some employees might miss the outdoor fire pits and blueberry bogs, most will appreciate the flexibility of working from home and the convenience of a satellite office which is probably closer to their home than the mega-campus.

In my opinion, the corporate campus or signature corporate high rise was always more of a CEO ego thing rather than a real strategy to improve productivity and creativity.  Most of the real work gets done in relatively small teams or departments.  Having 10,000 employees all in one place is not all that likely to generate as much cross-team collaboration or brainstorming as CEOs seem to believe.  Anyway, if working from home signals the end of the corporate campus, I think most companies will be far better off.

In addition to saving on office rent, companies with a strong work from home focus are likely to benefit from higher employee satisfaction scores, higher productivity (in most cases) and an enhanced ability to recruit from around the globe.  This last advantage applies more to recruiting superstar employees than it does to the routine recruiting of college graduates.  If your company needs 10 junior lawyers or 20 entry-level accountants, having a strong work from home platform will be an advantage but it will be just one factor out of several that new grads will be considering.  On the other hand, if you are trying to convince a high-profile, proven performer to join your company, being able to allow that person to work from wherever they want while still having a high level of integration with company personnel, systems and data might be a game changer.

The final advantage is that supporting work-from-home employees is very nearly the same as supporting freelancers who work on an as-needed basis.  Prior to the pandemic, companies were using more freelance and contract employees in place of their own employees to either reduce cost or to provide added flexibility for either rapid growth or unexpected shifts in demand.  Bolstering corporate systems to handle remote work also improves the ability to integrate freelancers more comprehensively into the corporate workflow, regardless of whether they are across town, across the country or around the globe. 

However, all of these advantages are going to come at a cost that I think many corporate leaders are probably underestimating.  It is still the right thing to do, but the “win” may not be quite as big as they are expecting.  Remember that what people and managers were willing to do during the pandemic crisis is not likely to be sustainable over the long term.  And hybrid scheduling, in particular, is likely to introduce new costs that aren’t currently well defined.

To begin with, the savings in office space probably won’t be as large as it might appear initially.  Even if only half of their employees are coming into work on any given day, most companies probably won’t reduce their office costs by half.  The types of tasks that are likely to be most important on the days that people are in the office are the collaborative, team oriented tasks that are harder to do remotely.  That means that companies will need to rip out cubicle farms and build both formal and informal collaboration spaces -- including state-of-the-art video conferencing/recording hardware and software so that collaboration efforts can still include remote workers.  Advances in virtual reality and augmented reality technology will make this easier over time but don’t expect it to come cheaply.  In addition, scheduling work spaces, meeting rooms and other employee resources for dozens or hundreds of employee teams is likely to require software that most companies have never had to purchase or use.

To make workers comfortable enough to come into the office even on a hybrid schedule, companies are going to need to ramp up their cleaning and disinfection routines and probably revamp their HVAC systems to include higher air flow rates, sophisticated filtration and perhaps UV purification systems.

Another cost that is probably being underestimated is in IT.  Expenses for hardware, software and IT personnel are all likely to grow significantly.  Many companies have already issued laptops to most of their office staff, but those who haven’t are going to be forced to do so if they really want to be serious about promoting work from home.  Again, relying on employees to log into corporate systems from their personal devices might have worked during the COVID crisis, but it won’t work as a long term strategy.  And to be really progressive, companies are going to want to offer multiple monitors, headsets and high quality office chairs either for free or at substantial discounts.  

On the software side, buying Zoom or Teams licenses is just the beginning.  Corporate legacy systems will need to be upgraded or replaced to support remote workers, and new software for team communication, collaboration and performance monitoring will be needed to really get the most out of a work-from-home strategy.

Supporting all of this far-flung hardware and software will put a tremendous amount of stress on the IT staff.  Expect staffing needs to increase, particularly for help desk personnel and training personnel.  In addition, working from home is an IT security nightmare because it multiplies the number of vulnerabilities that hackers can exploit. (6)  Companies dealing with sensitive data may need to deploy laptops with bio-metric authentication (e.g. fingerprints or facial recognition) to lessen the risk when laptops are inevitably lost or stolen.  High end encryption technology may be needed to fortify communication with remote employees using the home wi-fi set up they bought from Target.  Phishing and ransom-ware attacks are likely to explode, and fighting off those threats will be expensive and labor intensive.

Finally, companies should plan on increased training costs, particularly for managers.  In my experience, the more senior the manager the more likely they are to be technically challenged -- to the point where many simply delegate any technical issues to their underlings.  In a corporate world where the vast majority of workers are remote either full-time or part-time, that will no longer be acceptable.  In addition, managing remote workers requires different skills and management techniques.  Many managers who were successful in the office will struggle with remote or hybrid teams unless they are given the necessary training resources.

Impact on Cities

I’m going to start this section by pushing back on the story line that remote work means the decline of cities.  Yes, I’m sure some people have traded their central city condo for a nice single family home with lots of room in a quaint and serene village 100 miles away.  But anecdotal stories like that tend to distort reality, mainly because the pandemic made people do extraordinary things that in many cases won’t last once the pandemic has passed.  How long will it be before quaint and serene turns into trite and boring?

As I pointed out near the beginning of this post, the work from home trend will increase the number of households that work remotely 100% of the time, but not as dramatically as some have suggested.  The biggest impact will probably be felt in a few big cities where the cost of living and the cost of office space has gotten completely out of hand -- cities like New York, San Francisco or Boston.  People who can work from home full time have a substantial economic incentive to leave those locations.  Even then, it might just as frequently be a move from Manhattan to Long Island or Hoboken as it is to a fishing village in Maine.  And companies might downsize their downtown corporate presence but they aren’t likely to leave Silicon Valley entirely.  The value of office buildings might drop but they aren’t going to plummet.

For most cities, the bigger story is the rise of hybrid work-from-home opportunities which will weaken (but not break) the ties between companies and urban locations.  Hybrid work will change commuting patterns and the location of office space within communities, as companies rethink the role of office space as a corporate resource.  Office space will be less about doing typical work and more about reinforcing corporate culture, building effective teams, fostering creative collaboration, and allowing informal relationships to grow.  The question of “where will my employees want to work?” will become increasingly intertwined with “where will my employees want to live?”.

As the concept of the location of the worker becomes more amorphous, one by-product might be the long overdue elimination of business relocation incentives based on the number of new employees.  This is a generally unproductive approach to economic development even without the issue of a remote workforce, but it makes even less sense when the location of the new office and the location of actual workers are only loosely linked.  Cities will be far better off spending money on making their community an enjoyable place to live with a vibrant arts scene, a good educational system (including adult ed), efficient municipal services, solid infrastructure, and a reasonable assortment of recreational options.  Midwestern cities are not likely to be the best in any of these categories, but being above average in all of them can count for a lot.  If cities want to give incentives to something, give them to developers who are creating interesting places.  The value of placemaking is hard to pin down, but people gravitate toward places that offer energy, a creative edge and unexpected surprises.  Great places are the antidote to “midwestern bland” but they take effort and financial resources to build.

Another step that cities can take is to rethink their development plans and zoning tools with respect to office development.  To begin with, the demand for office space is likely to soften and there may be a short-term surplus of space if companies downsize their office leases.  Long range plans will also need to be downsized.  But more importantly, the distribution of office space may change.  

If people are going into the office for team meetings, training classes, and strategic planning sessions, are they more likely to want to be in the middle of an office park or in an area where there are restaurants, bars and shops within walking distance?  If you go to the office for “group” reasons, my guess is that a neighborhood that supports social interaction -- be it happy hour with the team or shopping after work with a friend -- is likely to be the strong preference.  This means that future office development might be more of “an innovative office design in a mixed use district” and less of “a sleek corporate cube in the office park out by the airport.”  In fact, cities may want to encourage traditional office parks to redevelop into mixed use districts before they fall into decay and become this decade’s version of the enclosed shopping mall.

Third, cities need to monitor the health of their transit systems.  My gut feeling is that transit will never fully regain the ridership levels that existed before the pandemic.  Most transit systems had pre-existing financial issues and the pandemic has put them into crisis mode.  If fewer people are commuting to work and there is a lingering distrust of packing into a confined space with dozens of strangers, major cutbacks may be needed.  In the long term, transit needs to be about mobility for all sorts of people on all sorts of trips, not just people commuting to and from work, but commuters often paid the bills and without them tough decisions will need to be made.

Finally, cities should allow flexibility and variety in housing formats and construction even if that means deviating from districts that are exclusively residential.  Apartment complexes, for example, may find that coworking space is an attractive amenity for remote workers in their complex but to make it feasible they may need to open it up to others in the surrounding area.  Or some people working from home might need to host team or client meetings that run afoul of local restrictions on home occupations.  Cities need to approach problems like these with fresh eyes and not be stuck with traditional practices.

What’s Next?

The rapid shift of millions of jobs to remote working arrangements of one kind or another is an almost unprecedented change.  I’m fairly confident that the thoughts I’ve shared in this post will end up being generally accurate, but the situation is fluid enough that I could be wrong on multiple fronts.  What is needed now is data, data, data.  Cities need to be tracking not only employment trends and office vacancy rates, but also commuting patterns, housing trends, transit ridership, expenditure patterns, and economic productivity.  I suspect there will be a fair amount of trial and error over the next few years, so real trends may not be clear until the best practices for a work-from-home workforce are standardized.

Thoughts?  As always, share your thoughts and ideas by leaving a comment below or sending me an email at doug@midwesturbanism.com.  Want to be notified whenever I add a new posting?  Send me an email with your name and email address.

Notes:

 1. “These Companies Plan to Making Work From Home the New Normal”; Rob McClean; CNN Business; June 2020; https://www.cnn.com/2020/05/22/tech/work-from-home-companies/index.html

2. “REI’s New Headquarters are like Summer Camp for Grown-ups”; Evan Nicole Brown; Fast Company; March 2020; https://www.fastcompany.com/90469523/reis-new-headquarters-are-like-summer-camp-for-grownups

3. “How Coronavirus Has - and Hasn’t - Changed the Way Americans Work”; Kim Parker, Juliana Menasce Horowitz, Rachel Minkin; Pew Research Center; December 2020; https://www.pewresearch.org/social-trends/2020/12/09/how-the-coronavirus-outbreak-has-and-hasnt-changed-the-way-americans-work/

4. “The Future of Work - the Good, the Challenging, and the Unknown”; Jared Spataro; Microsoft; July 2020; https://www.microsoft.com/en-us/microsoft-365/blog/2020/07/08/future-work-good-challenging-unknown/

5. “The New Future of Work”; Jaime Teevan et al; Microsoft; January 2021; https://www.microsoft.com/en-us/research/project/the-new-future-of-work/

6. “Future of Secure Remote Work Report”; Cisco; https://www.cisco.com/c/en/us/products/security/future-secure-remote-work-report.html

7. Special thanks to Craig and Rebecca Ciuppa for their numerous insights into remote work at a large corporation during the COVID-19 pandemic.

Post 14: Resiliency Is Hard

 One of the buzzwords in the planning profession over the past decade has been the concept of resiliency - the notion that our cities should be designed and operated in a way that makes them more resilient to natural disasters or man-made disruptions.  Recent events such as the COVID-19 pandemic, extensive wildfires on the west coast, or even the storming of the Capitol in Washington, D.C. have made me focus on this topic a little harder than maybe I otherwise would.

On the surface, it is pretty hard to argue against resiliency.  Who wouldn’t want their community to bounce back quickly after some catastrophe?  But what I see most cities doing, and what I experienced in my 30+ years in local government, is a pretty half-hearted effort that doesn’t really advance the concept of resiliency very far.  In fact, many cities have development policies that I would argue do the exact opposite -- they increase the fragility of a community rather than its resilience.

Most cities are reasonably good at dealing with the types of disasters that are fairly common.  In the midwest, that would be things like floods and tornadoes.  Many cities have an emergency operations center where a coordinated response can be planned and executed to minimize the loss of life and to provide temporary food, shelter and medical assistance.  That is wonderful, but I think that true community resilience needs to be able to address negative events that have more complex causes, are much broader in their impact, and have a much longer duration. 

The Municipal Black Swan

In his influential book, Nassim Nicholas Taleb talks about the impact of highly improbable and highly disruptive occurrences that he labels “black swan” events.  According to his definition, black swan events have three characteristics:

They are outliers.  They are outside the realm of normal expectations because nothing in the recent past can convincingly point to its occurrence.

They have an extreme impact.  Not just another minor eruption of Kilauea, but a Pompeii-destroyed-by-lava-and-ash kind of event.

Retrospective predictability.  No one sees it coming ahead of time, but after the fact people concoct various explanations which make the event appear predictable. (1)

Fortunately, there aren’t very many events that truly qualify as a black swan.  Even the recent pandemic doesn’t really meet the definition because although its impact was extreme, it was something that experts had been warning about for years.  For the sake of this post, I’m going to focus on extreme events that have a broad and long lasting impact, and which are rare or unprecedented if not totally unpredictable.

Part of the problem with trying to build resilience for extreme events is that they are rare enough that people don’t take them seriously.  Humans are biologically programmed with a series of cognitive biases that, while useful in some situations, tend to inhibit our ability to accurately assess severe or long-term risk.  We tend to assume that tomorrow will be similar to today or yesterday, and that bad events happen to someone else or will happen with enough warning that we will be able to adjust.  

Taleb sheds some light on this tendency by telling the story of the turkey.  Every day of the turkey’s life, the farmer carefully fed and cared for the turkey.  Every day was the same until the turkey logically assumed that this was the way things were always going to be.  Until, of course, the day before Thanksgiving when the farmer chopped the turkey’s head off so that he could be someone’s holiday dinner.  From the turkey’s perspective, this was a black swan event -- catastrophic and unpredictable!  To the farmer, of course, it was totally normal.  The point is that relying solely upon observations of the past from our own limited perspective can blind us to what the future might hold.

I don’t want to be an alarmist, but it is not too difficult to imagine scenarios where the scale of the disaster is far greater than the typical flooded river.  For example:

Government institutions are incapacitated or overwhelmed.  Think of the devastation in Haiti in 2016 caused by hurricane Matthew when over 25% of health care facilities were destroyed and cholera was widespread because fresh water was unavailable to thousands of people.  How would people react if the institutions we depend upon in a disaster were no longer functioning or severely crippled?

Power and communication systems have long-term outages.  We are used to occasional outages of a day or two caused by winter storms, but California had weeks of rolling blackouts caused by just high winds and fire risk.  What if a malicious attack on the power grid or a key component failure left large sections of the country without power and with limited communication for weeks at a time?  How long would it take for our electricity-reliant society to begin to panic?

Distribution of essential goods is disrupted.  The COVID-19 pandemic has underscored the potential problems that our distributed system for supplying food and other daily essentials could cause.  Yes, it is efficient, but it is also very complex because of the large number of moving parts.  Some people were panicked enough by COVID-19 to hoard toilet paper, but what would have happened if daily deliveries of food to supermarkets were interrupted for weeks because too few truckers or factory workers were available?

I’m fairly confident that most communities don’t address these types of scenarios in their disaster preparedness exercises and yet they are not outside the realm of possibility.  How resilient would your community be if an event of similar scale and impact took place?

I suspect that many communities simply assume that action by the state and/or federal government would bail them out should something really catastrophic occur.  To a degree, that assumption is likely correct -- witness the federal response to the pandemic or Hurricane Katrina.  But actions by state or federal agencies are likely to be slow in coming, and designed to address only the worst impacts rather than really return a community to prosperity.  In my opinion, the strongest cities will be prepared to take local action so that their communities recover more quickly and more completely.

The Example of College Towns

Resiliency planning should also consider things which are not actual events but more of a rapidly spreading social trend or economic shift.  Consider, for example, college towns which are common throughout the midwest (and the rest of the country as well).  These are often small to mid-sized cities dominated by a large university.  For the last several decades, college towns have lived a fairly charmed life as a steadily growing influx of students spent lots of money and funded lots of good-paying jobs.  But recent experiences with remote learning have shown that universities are ripe for change.

One of the primary factors is money.  The ever increasing cost of a four-year education and the mounting horror stories of graduates looking for a job during a recession while buried with student loan debt are causing many to rethink the value proposition offered by traditional universities.  Yes, a college degree does improve lifetime earning potential, but is it worth $50,000 per year or more?  Aside from the very top-tier institutions, students are going to increasingly insist upon value which means that universities are going to have to cut costs since endowment funds and state legislatures are not likely to make up the difference.

The second primary factor is technology.  Universities responded to the pandemic by cobbling together off-the-shelf technology from Zoom, Google, Microsoft and others, and the result wasn’t always pretty but it was reasonably effective.  What happens when virtual-reality teaching tools are released in the next couple of years which make remote learning more immersive and engaging than sitting in a large lecture hall?  We already know remote learning is possible, what if it became preferable?  And if I am learning remotely, why would I need an obscure professor at my state university when I could watch a lecture by a world renowned professor at Harvard, MIT or Stanford?

In short, learning is going to be largely disconnected from location and the best content will become widely distributed.  And when that happens, students are going to start re-thinking the entire college experience.  Yes, there are socialization and maturation benefits of going away to college, but people will find alternatives that don’t involve tens of thousands of dollars per year.

What would the impact on a college town be if the resident student population dropped by 50 percent and university employment fell by a similar amount?  I think it would likely be devastating.  Many businesses would close, construction activity would evaporate, and there would be a huge housing surplus which would depress rents and home prices significantly.  These impacts (and more) would ripple throughout the community for years.  And yet I would be willing to bet that only a small number of college towns have explored this scenario as part of their long-term planning activities or disaster preparedness plans.

Does this scenario seem highly unlikely?  Several experts would probably accuse me of understating the impact.  Take, for example, Scott Galloway who has founded his own virtual classroom start-up and currently teaches marketing at the NYU Stern School of Business.  He estimates that hundreds, if not thousands, of brick-and-mortar universities will go out of business and those that remain will have a student population composed mainly of the children of the very rich.  He envisions the top universities partnering with big tech companies -- think Apple and Stanford creating an “iUniversity” -- that can now enroll 30,000 students instead of 16,000 and still not dilute the learning experience because of technology advancements. (2) 

Black Swan Resiliency

So, what should cities do to prepare for a future event or societal shift that has catastrophic results?  The answer, I think, lies in taking some common sense steps that would help with day-to-day problems as well as with the rare disaster.  These steps, however, will take time and effort which is why most short-staffed and under funded communities are not doing them already.

Be fiscally conservative.  All cities are under pressure to provide more services, better amenities, and higher quality infrastructure for their citizens.  At the same time, no one wants to raise taxes and many cities are constrained in doing so by state law.  The result is that governing bodies either have to become good at saying “no” or they adopt a “buy now pay later” type of mentality that decreases the resilience of their community.

What is missing in many cities is any type of cost-benefit analysis.  In fairness, it is often difficult to quantify the benefits of a new city service, a new city park, or a wider street.  The best proxy might be evaluating whether citizens would be willing to pay more in taxes to gain the new service, park or street.  Red flags should go up if the new benefits can only be paid for by increasing long-term debt.  High debt service levels reduce the ability of a community to absorb the economic shocks that are likely to accompany an unforeseen disaster.  In fact, a community’s bond rating is a reasonable measure of fiscal health.

Focus on redevelopment and infill.  Too many cities equate growth with outward geographic expansion.  In order to improve the efficiency of existing infrastructure and service capacities, cities should find ways to encourage redevelopment and discourage low-density sprawl at the community's edges.  In the long run, the cost of infrastructure expansion will not be covered by the revenue from single-family homes on half-acre lots.  

On the other hand, many cities have sections of town that are underutilized, undervalued and ripe for redevelopment.  Focusing growth in these areas will not only reduce new infrastructure expenditures, it will also reduce transportation costs and bolster the job prospects of disadvantaged residents.

Focus on local and incremental.  Earlier in this post I mentioned the cognitive biases that make humans poor judges of risk.  Witness, for example, our love of playing the lottery despite the astronomical odds against winning.  Unfortunately, cities tend to play their own form of lottery in the form of grandiose-but-low-percentage economic development gambles.  Hundreds of cities invested a great deal of time and effort in response to Amazon’s hunt for a second headquarters despite the fact that Amazon was highly unlikely to go anywhere other than a small handful of major cities.  Lavish economic incentives are promised for huge manufacturing projects that are more wishful thinking than reality, such as Foxconn’s mega-factory in Wisconsin which so far has yielded about 5 percent of the promised investment and 10 percent of the promised employment.

Cities would be far better off focusing on local and incremental economic development strategies.  Supporting and incentivizing local entrepreneurs is likely to create as much or more employment than convincing an out-of-town company to build a factory.  And that employment is much less likely to leave town during the next economic downturn.  Similarly, cities would be better off with 100 small developers that build 10 homes a year than with a national chain that builds 1,000.  Local developers are likely to be more innovative, more adaptable, and more committed to the welfare of the community over the long haul.

Rethink the approach to long-term plans.  In general, cities plan for the future they want.  You know, the one in which jobs are plentiful, education is innovative, recreational opportunities abound, retailers thrive, and the population grows.  This is known as normative planning and it makes total sense.  Most of us are optimistic people and so we plan for our vision of a better tomorrow.

This does not, however, do much for a community’s resiliency.  We would be better off looking at a range of possible futures, including some that we don’t want to happen.  A recent article by Uri Avin and Robert Goodspeed describes this approach and refers to it as Exploratory Scenario Planning. (3)  While it probably doesn’t make sense to develop a full set of supporting plans for a negative scenario, at least discussing the implications that negative scenarios could have for a community might refocus priorities away from projects that are hopelessly optimistic toward those that are more practical.

Build trust.  Rebuilding from a natural disaster or a devastating societal change will require a great deal of trust and cooperation across the spectrum of the community.  That trust does not magically spring into being when needed; it must be cultivated and nurtured ahead of time.  Every city has a myriad of cultural, political, philanthropic, and economic institutions and organizations all aiming to improve the community.  Unfortunately, many of these organizations operate in their own little bubble, aware of other organizations but not interacting with them to any significant degree.  To the degree that there is interaction, it may be more as competitors for money or prestige rather than as partners working toward the same goal.  That needs to end.  City leaders need to foster a broad understanding and appreciation across the community of what each organization is capable of doing and what challenges each organization faces.  Trust and cooperation built when times are good will pay off handsomely when times are bad.

Thoughts?  As always, share your thoughts and ideas by leaving a comment below or sending me an email at doug@midwesturbanism.com.  Want to be notified whenever I add a new posting?  Send me an email with your name and email address.

Notes:

1.  “The Black Swan:  The Impact of the Highly Improbable”; Nassim Nicholas Taleb; Random House, Inc.; 2007.

2. “The Coronavirus Will Disrupt Future Colleges and Universities”;  James D Walsh; New York Magazine, Intelligencer; May 2020; https://nymag.com/intelligencer/2020/05/scott-galloway-future-of-college.html

3. “Using Exploratory Scenarios in Planning Practice”;  Uri Avin and Robert Goodspeed; Journal of the American Planning Association; May 2020; https://www.tandfonline.com/doi/abs/10.1080/01944363.2020.1746688?journalCode=rjpa20