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Smart city-regions need smart people

Cities, when you look at them, aren’t smart at all

By Simon Collinson & Amir Qamar  

Read more of Prospect’s “Data as infrastructure” report

Migration to cities is increasing so much that, by 2050, the UN predicts that approximately two thirds of the world’s population will be living in cities. For economic, social and political reasons we have to do more than just cope with this level of urbanisation.

As well as being efficient and operational, we have to make cities creative, innovative and good places to do business. We also have to make them attractive places to live and work, to draw in people and firms. They also need to be inclusive, not exclusive. All these ideas gave rise to the idea of the smart city.

For some, a smart city has six components: the economy, its people, governance, mobility, the environment, and everyday existence. The smart city idea focuses on the links between them all.

Take urban transport systems, for example, which are extremely complicated and have a major influence on labour mobility and economic efficiency, linking available workers and jobs. They also influence the business environment more broadly connecting or separating clusters of firms and people.

The UK government’s call to prohibit the sales of new petrol and diesel cars by 2040 will promote electric vehicles and further the green agenda. Poor air quality has been named as “the biggest environmental risk” to public health, and this has become a Whitehall priority. However, this new £3bn initiative—the Clean Air Strategy—will have other effects. The smartest cities will not only implement this policy effectively, but leverage a range of other opportunities from this legislation.

This presents opportunities to improve both energy use and transport logistics. Sensors will be able to optimise traffic flows to reduce daily commute times and allocate open parking spaces, making life easier for commuters and people who live in the city. Public transport systems would equally benefit from more precise, real-time monitoring of people flows and alternative routing options.

The other side of the smart city question focuses on how to both grow and attract innovative firms. Skilled people and high-performing firms attract each other—and both are attracted to places with good schools, housing, services, amenities and cultural assets and attractions as well as efficient transport systems and clean air. The aim is to generate a virtuous cycle of growth and renewal.

Again, as an example, the new clean-air legislation offers opportunities for city-regions to catch a wave of investments in new technologies, products and services. But not all will benefit. Smart specialisation means focusing investment on industry sectors or technologies where a city-region already has advantages. Birmingham has a competitive advantage for future low-carbon automotive products and technologies. It has a wealth of skills, world-leading firms like Jaguar Land Rover and a large number of smaller supply-chain firms as a result of its historical focus on automotive engineering and advanced manufacturing.

Neoclassical economic thinking says that markets operate more efficiently when we reduce information gaps and asymmetries. The smart city, with its stress on the collection and analysis of data, is well placed to embody that thinking.

The intelligent analysis of data can also support more precise interventions for policymakers to shape city-regions in terms of not just growth, but inclusive growth, creating local opportunities for disconnected and disadvantaged groups as well as for high-performing firms and well-established industries.

But there are challenges when we look past some of the smart city hype. Although we have access to growing volumes of data, it costs money to get that data into a practical form. And if the aim is to enable the real-time integration of multiple data sources, then the cost, and complexity, should not be underestimated.

Perhaps the biggest hurdle stems from the lack of skills and capability in the workforce. Because really, cities are not smart—it’s people who are smart. Our challenge is to develop the necessary expertise to be able to analyse, interpret and derive meaning from this data. Without the capability to exploit these opportunities, our city-regions may well get bigger but they will not be smart.

On the 3rd of October, Prospect launched Data as Infrastructure. This special report grew out of a series of high-level roundtable meetings over the summer which brought together government, private businesses and the third sector to look at how data is already being used to improve people’s lives and how it has the potential to do so much more.

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