Are Cities Entrenching The Skills Gap Within Countries?

As I sat down to listen in on the latest ‘mentoring masterclass’ from social network The Dots, I had no idea really what to expect or the direction the evening would take.  The company provide a home for the creative classes, offering ‘no collar’ workers the chance to showcase their talents, pitch for work and network with the kind of music companies and television studios that are crying out for their skills.

When founder Pip Jamieson welcomed her tribe to the evening, she pitched her flag firmly in the camp of the citizens of nowhere that I’ve written about before.  The pejorative term was used by British prime minister Theresa May in a conference speech back in 2016 to describe people who predominantly live in large cities and that are comfortable living and working anywhere.  They see themselves as citizens of the world, but May and other populist leaders regard them as citizens of nowhere.

A regional divide

Geert Hofstede was familiar with this trend long before it became part of mainstream political discourse.  His work analyzing the values within and across nations identified striking similarities between residents of large cities across nations, such that Londoners and Parisians have more in common than Londoners do with residents of Rochdale.

A recent study from researchers at Anglia Ruskin University and Copenhagen Business School set out to examine these cosmopolitans, with participants from 14 different countries who were living and working in Amsterdam at the time of the study.

The study finds that these people, as Hofstede suggests, do have a shared identity, but it is with each other rather than with their nation of origin, or even their cultural background.  That isn’t to say that they denounce their upbringing, for most continue to maintain their national and ethnic cultures, but it’s a part of their identity rather than their entire identity.  Indeed, for most, their global identity is a badge of honor, with many revealing difficulties identifying both with their countrymen, and indeed their hosts, unless they are similarly global in outlook.

This disconnect within nations has helped to stoke the fires of division that are appearing within countries around the world, manifesting itself most spectacularly in the rise of Donald Trump and the vote for Brexit.

What’s more, a recent paper from MIT suggests that those same small towns are likely to bare the brunt of any impact technology will have on the labor market.

The central hypothesis is that automation is more likely in roles with repetitive tasks playing a major part, and such lower skilled roles tend to be concentrated more in smaller towns than larger cities.

Building walls or breaking them?

It’s a challenge that platforms like The Dots don’t appear to be addressing.  For instance, whilst they have 250,000 members, the majority of these are clustered in major cities around the world.  They are more likely to have members in Barcelona than Bolton, and the mentoring masterclasses are predominantly located in London itself.

This concentration of talent, resources and opportunity in major cities is something I touched on in a recent article that explored the network benefits scale brings for innovation.  Entrepreneur James Liang argues that clusters naturally form due to the scale and agglomeration benefits they provide.  Whilst the phenomenon may be natural, it does present a significant challenge for policy makers who want to spread opportunity more widely.

Indeed, a recent report from Nesta found that the small towns most at risk of experiencing technological unemployment are also those towns with the lowest productivity levels.  As the network effect makes big cities stronger, it sucks energy and productivity out of smaller towns.

That’s not to decry the work of platforms like The Dots, for there is much that is admirable about both their mission and the way they go about it.  For instance, they pledge to ensure at least a 50/50 male/female ratio at their masterclasses, with at least 30% of attendees from an ethnic minority background.  That desire to provide a diversity of opportunity is admirable, but it does nonetheless largely deny opportunity to those that recent political events suggest are most craving it.

I wrote recently about attempts to bolster adult education to provide a buffer against the potential impact of technology on employability, and it cited research that highlighted the very clear divide between the haves and have nots in terms of accessibility.  Indeed, the situation was such that attempts to provide more accessible education opportunities merely exacerbated the situation because the wrong people took advantage of them.

If we want what is a largely divided society to be healed, we surely need to do much better at knocking down the structural and behavioral walls that have come to define that divide.  There is much to suggest that the changes we’re experiencing today are not massively different to changes experienced in the past, but there is sadly not much evidence to suggest we’re any better at dealing with the disruption changes to work has on a region.

The implication is very much that if patterns of job creation in the future reflect those of the past then the political divide illustrated by the Brexit referendum result and the Trump election will likely grow wider.

It’s a task that is undoubtedly easier to solve in theory than in practice, but if we want to get the best out of all sections of society, it’s a task we can’t put off any longer.  It will require officials to do much more to create an environment where knowledge can be created, used and exchanged more readily in these disadvantaged towns.  Time will tell if it’s a challenge that society is able to meet head on.