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In 2021, we all have a part to play in reviving central London
8 December 2020
The COVID-19 pandemic has made central London unrecognisable from the bustling metropolis it once was.
Looking to the future, our recently published estimate, as part of work for the Northbank, Midtown, and Victoria Westminster business improvement districts, provides a stark picture of what’s happening in the core of London.
Even if the recent good news on a vaccine proves to be a turning point, and many office workers return on a part-time basis in the spring, office occupancy could be down by 34% by December 2021, when compared with January 2020. This would lead to an estimated 53,000 jobs put at risk by the lack of footfall from office workers, concentrated in the sectors that depend on face-to-face interactions such as retail, entertainment, hospitality and accommodation. Importantly, many of these offer a career, skills and training, to Londoners that leave education with few qualifications. Under this scenario, the economy of central London would contract by some £37bn by December 2021, which represents a significant hit to UK plc as a whole.
If the vaccine does not have an immediate impact, and we live through 2021 much like we did through autumn 2020, with a very slow, steady return to office life, and with 60% of white collar workers staying away, we estimate that 84,000 jobs could be a risk. This would leave a £60bn hole to fill in central London’s GVA. These are not fantasy numbers, but translate into stories of redundancies, lost livelihoods and significant impacts on lives.
The good news is that we can do something to prevent this. There are several barriers to people accessing central London, and many of the ones that will remain, even when the immediate health risks of Covid have alleviated, are behavioural. Removing them is key to central London’s survival, recovery and eventually its return to prosperity.
This includes the expense of travel (such as rail season tickets), and lack of surety about whether this will have been ‘wasted’ if government guidelines change. It covers supply side issues such as businesses not being open, and a reduced choice of offers, or a need to book time slots, resulting in reduced opportunity for spontaneous decisions after work. Moreover it includes habit – including the lack of presentee expectations on behalf clients and colleagues, and an absence of ‘fear of missing out’ or FOMO that has so long been associated with both big city work and leisure opportunities (“no one else is going into central London so why should I bother?”). To really get people into town, we need to change the story of our nights out away from Netflix and back to cultural experiences, fine dining and sweaty gigs. Preferably all in the same evening. We all have a duty to bring FOMO back.
In our report we suggested other potential, more workaday remedies. These include business rate holidays for the economic sectors most at risk from social distancing measures, a flexible working 3‑day-a-week pay-as-you-go season ticket for rail travel, and investments in public realm including transport infrastructure like walking and cycling routes, so that people can get back to work safely and sustainably. And of course, joining with others, such as tourism organisations, and those looking after overseas students, to bring other types of footfall back into town. We also suggest that firms have their roles to play through the redesign of office space to ensure that workers are interested and encouraged to visit offices more often, and to allow them to make the most of face-to-face contact on their days in town. If these have the impact of raising the attendance of office workers by even half a day a week, they could add £7bn to central London’s annual GVA.
The Mayor’s recent announcement that he is commissioning research on the future challenges and opportunities facing central London, and the formation of a London Recovery Board, is a major step forward in taking action to mitigate the impacts of the pandemic. We note that similar pieces of work are underway in Leeds and Manchester, and in New York City, Sydney and other global cities. The ability of cities to reinvent themselves is phenomenal. London has weathered crises, wars and pandemics, but has always managed to change course and come back stronger than ever. A balance of home and office life seems to be the best recipe to help employers, individuals, and the wider economy in the brave new world. Whilst remote work does not have to be merely an emergency response for business continuity, to be discarded when the pandemic subsides, let’s hope that the photos taken by cyclists of proverbial tumbleweed on empty city streets are soon to become museum pieces.
Don’t forget — In January, London First’s Building London Summit provides an opportunity to dig into what the post-pandemic world means for the built environment via a series of online events.
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