Is COVID-19 the End of Cities?
Strong Towns member Joe Cortright runs the think tank and blog City Observatory.
The New York Times tells us that cities were “losing their allure” before the COVID-19 pandemic, and that now people are preparing to flee urban areas. Sure, cities had a bit of a resurgence after 2000,
But by the mid-2010s, the growth slowed. Big cities had become expensive, with rents far out of the range of the middle-income American. The economy was changing too: Low-wage jobs, after adjusting for the local cost of living, paid about the same everywhere.
Then the virus hit, sharpening questions of affordability and lifestyle. Some argue it could accelerate the trend that was already underway.
The article goes on to quote an economic development official from Tulsa, Oklahoma (which pays $10,000 to people willing to move there), as saying fear of the pandemic could lead more people to come to his city. Another bit of evidence for the demise of big cities is an uptick in buyer interest for condominiums in South Florida.
The article’s conclusions hinge on two claims that are at best dubious:
The first is that cities are “losing their allure”—as evidenced by slowing rates of population growth in cities relative to suburbs. Population isn’t rising as fast in cities now as it was a few years ago, ergo, people must not like cities anymore.
The second is that moving to the suburbs or rural communities is a way to escape the COVID-19 virus, or future pandemics, because of “density.” In a sense, the associating fear of disease with density is reviving an old anti-urban meme: the “teeming tenements” theory of public health. We’d all be somehow safer if we just lived on large lots in bucolic hamlets.
In our view, both these claims are wrong, and as a result, there’s no reason to be dour about the future of urbanism, or think that decamping from cities would do anything to lessen our individual or collective vulnerability to future pandemics. Let’s consider each, in turn.
Are people disenchanted with cities?
True, the nation’s cities were outpacing their suburbs in population growth in most of the last decade, and that pattern has slowed considerably. But the slowing rate of urban population growth is misinterpreted. If there were no constraints on the number of people who could live in cities, a simple body count comparison would be a fair representation of revealed preference. But as we’ve pointed out before, the real problem—as abundantly demonstrated by the housing shortage and rising rents—is that we’re bumping up against the limits of the number of people we can fit in cities, and aren’t building new housing (and great urban neighborhoods) fast enough to accommodate the demand. The most powerful—and un-contradicted—bit of evidence is the increasing prices people are paying to live in central locations and walkable neighborhoods.
The recent Bill Frey analysis cited in that New York Times article points to slowing population growth in urban counties relative to suburban ones. But this body count is too much demography and too little economics: As long as there was slack in city housing markets, people could move there; if they’re not moving there as much now, it’s because we’ve used up all the slack (which is strongly indicated by rising prices in the city and the steepening of the urban rent gradient). The reason why cities are so “expensive,” as the Times says, is because demand is outstripping supply. Also, as we’ve frequently pointed out, it’s hard to accurately infer what’s happening in denser urban neighborhoods from looking at county data.
There are no reasons to doubt census population counts, but there are good reasons to question the superficial claims that some have made that these population trends signal widespread disenchantment with urban living or a newfound love of suburban tract homes. Here’s why:
Today’s young adults, especially those with college degrees are vastly more likely to choose to live in close-in urban neighborhoods today than their predecessors in earlier generations. As our reports on the Young and Restless show, the number of well educated young adults is increasing twice as fast in close-in urban neighborhoods than the rest of metropolitan areas.
Simply counting heads doesn’t reflect the demand for urban living. High and rising rents and home prices in urban centers show demand is outstripping supply. Higher relative prices for city homes vs. suburban ones is the most powerful evidence of consumer preference for cities. As we’ve demonstrated in our posts on the “Dow of Cities” urban homes now command higher prices relative to suburban ones. Same for walkable neighborhoods.
Cities were able to grow population robustly up to the point where their housing market slack was exhausted. Now city growth is limited by how fast we can add new housing, which is not fast enough. The failure of cities to grow as rapidly as suburbs really points to a shortage of supply, not a lack of demand. You have to assume that housing is equally and essentially infinitely elastic in both cities and suburbs in order to interpret simple comparisons of population data as measure of revealed preference.
Ultimately, the policy implication of all this is not that Americans, especially younger ones, are disenchanted with cities and want more suburbs. In fact, it’s exactly the opposite. The unrequited demand for urban living indicated by high rents and home prices, and the complaints about having to move to suburbs to afford homes signals that policy needs to respond by creating more housing in cities. When we finally make it as easy to build new housing in cities as we do in suburbs, for example, by allowing missing middle housing to be built, we’ll see urban population grow more rapidly.
Does density aggravate the pandemic?
Rising rents and suburban growth mean we’re not doing enough of this. Image source.
The second part of the Times’s argument is that living in big, dense cities somehow makes people more vulnerable to the pandemic. So, logically, people will flee to be safe. In a sense, this is a warmed-over version of some old myths about the negative health implications of living in cities, the “teeming tenements breed disease” argument. As Todd Litman has neatly summarized, the health data are unambiguous: city living is associated with lower rates of morbidity and mortality; the kind of sedentary lifestyle propagated in suburbs, is actually bad for your health.
When it comes to the COVID-19 virus, if there is a problem of over-crowding, it seems to be largely confined to nursing homes, prisons and cruise ships or aircraft carriers, not cities.
As we look around the world there are plenty of places far denser than typical American cities that have largely dodged the coronavirus epidemic. Blogger Aaron Carr gives a nice synopsis of this observation.
New Zealand, South Korea, Germany, Taiwan, Thailand, Australia, Singapore, HK, Japan, Norway, Canada, + CA have a combined population of nearly 500m people, but 1,900 fewer COVID deaths than NYC. Density isn’t the problem. Failing to plan, prepare, and act early/aggressively is.
And, as we’ve pointed out in a detailed analysis comparing Vancouver, British Columbia with US cities, there’s little reason to believe that, even in North America, density drives the pandemic. Vancouver is the third most dense city on the continent, and has a low rate of reported cases.
Bloomberg’s Noah Smith makes that same point, and also notes that outbreaks have been common in suburbs:
California’s outbreak started in suburban Santa Clara county rather than San Francisco and is still more severe in the former. New York’s outbreak started in Westchester County, north of New York City. These epicenters are suburban areas that we don’t normally think of as being very dense. This suggests that social and professional networks, rather than random interactions on streets or in trains, are the main vectors by which diseases such as the coronavirus spread.
More specifically, a lot of people seem to think that one particular aspect of density—urban transit systems—contribute to the spread of the virus. There’s a working paper from MIT economist Jeffrey Harris that seems to imply a connection between transit ridership in New York City and the intensity of the pandemic in particular neighborhoods. Alon Levy and Salim Furth have already written comprehensive takedowns of this claim.
Writing at Pedestrian Observations, Levy notes that the paper’s only quantitative claim is based on a comparison of Manhattan with the rest of New York City, one which is fraught with problems because of differing income levels, travel patterns and other factors.
In an article published at Market Urbanism, Furth presents his own statistical analysis looking at the connection between car use and reported COVID-19 cases. He finds that in car-dependent portions of New York City (like Staten Island, and outlying neighborhoods in Queens), reported cases per capita are higher than they are in denser neighborhoods with higher levels of transit use. He concludes:
Taken together, the global trends, suburb versus city infection rates, and neighborhood trends within New York suggest that transit-dependent cities are easier to protect from viral infections even when the transit system remains open.
In the heat of the crisis, it’s easy for fear and misinformation to circulate. The claims that the city and urban living are a contributor to disease is based on an old set of anti-urban biases, that seem to have little basis in fact. Over time, as the pandemic wanes, its likely that a cooler and more fact-based view will prevail, and the baseless bias against cities will subside. It’s helpful in that sense to recall that the heyday of American urbanism was the decade of the Roaring Twenties which followed immediately after the Spanish Influenza epidemic of 1918 and 1919.
Be optimistic about cities going forward
The epitaph of cities has been written many times. We were told that in the wake of 9/11 no one would want to live in dense areas for fear of terrorist attacks. We were told that the advent of the Internet and shopping would allow people to forego traveling to cities for jobs and goods, but the back-to-the-city movement has flourished and accelerated coincident with the widespread adoption of these technologies. Once again, we’re being told that a new fear will drive people to the suburbs or rural towns. Paul Romer, a Nobel Prize-winning economist, addressed this question head-on in a recent interview with Brandon Fuller of the Manhattan Institute.
Fuller: Does the pandemic make you more or less optimistic about the benefits of urban agglomeration?
Romer: The fact is that the intense interaction that cities allow is immensely productive. I think what we’re going to learn from this is that there are a variety of ways to continue to interact frequently while minimizing the risks of transmitting viruses. I doubt that this is going to slow down the growth of cities. I think the underlying economic reality is that there is tremendous economic value in interacting with people and sharing ideas. There’s still a lot to be gained from interaction in close physical proximity because such interaction is a large part of how we establish trust. So I think that, for the rest of my life, cities are going to continue to be where the action is.
About the Author
Joe Cortright is President and principal economist of Impresa, a consulting firm specializing in regional economic analysis, innovation and industry clusters. Over the past two decades he has specialized in urban economies developing the City Vitals framework with CEOs for Cities, and developing the city dividends concept.
Joe’s work casts a light on the role of knowledge-based industries in shaping regional economies. Prior to starting Impresa, Joe served for 12 years as the Executive Officer of the Oregon Legislature’s Trade and Economic Development Committee. When he’s not crunching data on cities, you’ll usually find him playing petanque, the French cousin of bocce.
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