What Does the Future Business District Look Like?

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Covid-19 ushered in a dramatic change in working practices. Professor Anne Green looks at three major impacts this will have for cities like Birmingham. 

This blog post was produced for inclusion in the Birmingham Economic Review for 2021.

The annual Birmingham Economic Review is produced by City-REDI, University of Birmingham and the Greater Birmingham Chambers of Commerce. It is an in-depth exploration of the economy of England’s second city and a high-quality resource for informing research, policy and investment decisions.

This post is featured in Chapter 4 of the Birmingham Economic Review for 2021, Connected Places: Foundations for Growth.

Click here to read the Review.

The pandemic shock to the Central Business District 

One key initial response to the Covid-19 pandemic was guidance that everyone who can work from home should do so. This resulted in a ‘Zoomshock’ as a substantial amount of economic activity shifted across geographical areas. In particular, many workers in Birmingham’s central business district abandoned their offices and worked from residential suburbs and cities, towns and rural areas outside Birmingham. They took their demand for locally-consumed services with them away from the central business district.

Impact of home working

This ‘forced experiment’ of remote working and increased online shopping was more seamless than many expected. Remote working is not new, but formerly progress had been slow despite ongoing expectations that with the ‘death of distance’ the agglomeration advantages of central business districts would be eroded. The Covid-19 lockdown changed that: in April 2020 over 43% of workers nationally were working from home, up from just under 6% in early 2020. The swift acceleration and extensiveness of the take-up of digital tools and the boost to online working will have an important legacy for people and places.

Of course, not all tasks can be done remotely. In contrast to ‘anywhere jobs’ there are high-touch public-facing roles and construction, infrastructure and many maintenance tasks that cannot be can be done remotely. ‘Anywhere jobs’ are disproportionately concentrated in the professional and business services sector. The highly qualified in professional and technical roles, alongside workers in administrative occupations, are over-represented in them.

What does the future business district look like?

So, what does the ‘next normal’ look like and what does it mean for the future business district? While remote working is applicable for detailed and asynchronous tasks and those involving limited responsibility, it is less well-suited for onboarding new colleagues, organising new projects and developing new collaborations, where face-to-face contact helps build social networks and social capital, corporate behaviours and trust-based relationships. This suggests (even without taking account of practical considerations such as whether workers have a suitable base from which to work remotely) that for many jobs previously undertaken in central business district offices, future working patterns will be ‘hybrid’ – working partly in an office and partly remotely. The ‘forced experiment’ has shown it is possible for many to work effectively and productively remotely (at least for some of the time), with some reaping benefits of work-life balance.

Although working partly in the office and partly elsewhere is not new for the professional and business services sector, quite how the accelerating journey towards ‘hybrid working’ will unfold is uncertain; there is likely to be some ‘trial and error’ as employees and managers design, implement and enact new working patterns. Yet some of the implications for Birmingham’s central business district are clear.

Mobility patterns in Birmingham

First, in relation to transport and mobility patterns, as fears of crowded places persist amongst some individuals, reluctance to use public transport when it is busiest, alongside changing working patterns, fewer people are expected to commute five days per week during peak hours, especially in the short-term. This has important implications for the viability of public transport systems serving the city centre.

Emerging opportunities for Birmingham

Secondly, the types of activities taking precedence in the office will change, with greater emphasis on connecting, collaborating, brainstorming and socialising with colleagues and customers. This means high-quality office space is at a premium. Internal office design is changing to accommodate the new balance of functions. In relation to this, and also of importance for future talent, Birmingham is also emerging as an important centre for training for new graduates and more generally for ‘north-shoring’ operations out of London. Investment in high-speed internet and an attractive business district, and more broadly in what makes Birmingham an attractive place to live as well as work, is key for anchoring these positive developments. In the wake of the pandemic, the urban built form is likely to evolve towards a greater emphasis on external meeting places and other aspects of urban design, taking heed of environmental, health and well-being considerations. Greater emphasis on connecting and collaborating is likely to mean greater demand per business district worker for associated local services. In turn, this should help to reinvigorate the diverse range of hospitality services that Birmingham had developed prior to the Covid-19 pandemic as an essential element of the business district ecosystem.

Marketing Birmingham assets

Thirdly, while Birmingham’s professional and business services sector has benefited from, and contributed to, a dense labour market in the city centre and beyond, the area’s wider amenity and interaction value are likely to be increasingly important going forward. With the shift to online shopping, the trend towards experiential retail is gathering pace. In future, there will be a greater onus on leveraging cultural and other assets to attract people into the city centre for events and entertainment throughout the week. Birmingham – like cities such as London, Liverpool and Manchester – has strong assets. Packaging and marketing them into a wider Birmingham offer is key for the success of the future business district.

View all our work on the Future Business District 

This blog was written by Professor Anne Green, Professor of Regional Economic Development at City-REDI  / WMREDI, University of Birmingham.

The views expressed in this analysis post are those of the authors and not necessarily those of City-REDI / WMREDI or the University of Birmingham.

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