Millions of service jobs could be lost if pandemics become more frequent, expert warns

If pandemics become “the new normal” then tens of millions of urban service jobs could disappear, the annual conference of the Dublin Economics Workshop (DEW) heard on Monday.

Edward Glaeser, a professor of economics at Harvard University said cities had become "engines of global growth" and productivity.

However, high-density, services industry-dominated cities had left the world peculiarly vulnerable to an airborne pandemic like Covid-19, he said.

Pandemics temporarily shut down the industrial economies of the past but as soon as they passed through, “the coal mines and the factories were up and running again because customers weren’t afraid of getting the disease from their coal or their ice boxes”, Prof Glaeser said.

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“Move 100 years later, the ability to serve a cappuccino with a smile has been an employment safe haven as the factories disappeared and yet those jobs can vanish in a heartbeat when that smile becomes a source of peril,” he said, referring to the fear the pandemic wrought and how city centres were effectively gutted by the disease.

In his 2011 book Triumph of the City, Prof Glaeser, an urban economist, wrote about how cities, which foster face-to-face interactions, had harnessed productivity and innovation. His new book Survival of the City explores how the Covid-19 pandemic will change the trajectory of cities.

Much will depend on the lessons learned from the current contagion, he said, and whether we are able to contain new viruses before they spread.

Prof Glaeser debunked the notion that governments were forced to make difficult trade-offs between economics and health.

“That was a foolish thought because it was fear, not a government lockdown, that shut down mobility,” he said, noting that businesses had closed and people had stopped travelling in New York prior to lockdown/social distancing rules being enforced.

“We spent far too much time worrying about whether the government should have lockdowns or not when people were locking down altogether,” Prof Glaeser said.

Great division

While cities have been drivers of great wealth and progress, they have also become sources of great division in terms of wealth and opportunity, and Covid-19 has exposed these divisions, he told the conference.

“Over the past 20 years increasing divisions between rich and poor, insiders and outsiders, have left our cities divided,” he said.

"And you saw the fruits of that division when thousands took to the streets [in the US] to protest the killing of George Floyd despite the fact that we were in the midst of a pandemic."

Prof Glaeser highlighted three inherent failures of the US system – not providing opportunity, housing and secure jobs – and said governments would have to rethink their urban development.

Alice Charles of the World Economic Forum highlighted housing affordability as one of the key problems in cities across the world, and one that was likely to persist post-Covid-19. "The housing challenge is not an easy challenge to solve and you must look at the issue holistically."

Ms Charles said there were demand-side and supply-side issues driving the crisis. She said the supply-side challenges centred around land acquisition, land use and zoning, funding affordable housing, housing design and development costs. “Piecemeal interventions by governments will not solve the challenge.”