Forecast | Our future is urban: Future of Cities P1

Cities are where most of the world's wealth is generated. Cities often decide the fates of elections. Cities increasingly define and control the flow of capital, people, and ideas between countries.

Cities are the future of nations. 

Five in ten people already live in a city, and if this series chapter continues to be read until 2050, that number will grow to nine in 10. In humanity's brief, collective history, our cities may be our most important innovation to date, yet we have only scratched the surface of what they can become. In this series on the Future of Cities, we'll explore how cities will evolve over the coming decades. But first, some context.

When talking about the future growth of cities, it’s all about the numbers. 

The unstoppable growth of cities

As of 2016, over half the world’s population lives in cities. By 2050, nearly 70 percent of the world will live in cities and closer to 90 percent in North America and Europe. For a greater sense of scale, consider these numbers from the United Nations:

  • Every year, 65 million people join the world’s urban population.
  • Combined with projected world population growth, 2.5 billion people are expected to settle in urban environments by 2050—with 90 percent of that growth stemming from Africa and Asia.
  • India, China, and Nigeria are expected to make up at least 37 percent of this projected growth, with India adding 404 million urban dwellers, China 292 million, and Nigeria 212 million.
  • Thus far, the world’s urban population has exploded from just 746 million in 1950 to 3.9 billion by 2014. The global urban population is set to increase passed six billion by 2045.

Taken together, these points depict a giant, collective shift in humanity’s living preferences towards density and connection. But what is the nature of the urban jungles all these people are gravitating to? 

Rise of the megacity

At least 10 million urbanites living together represent what is now defined as the modern megacity. In 1990, there existed only 10 megacities worldwide, housing 153 million collectively. In 2014, that number grew to 28 megacities housing 453 million. And by 2030, the UN projects at least 41 megacities worldwide. The map below from Bloomberg media depicts the distribution of tomorrow’s megacities:

What might be surprising to some readers is that the majority to tomorrow's megacities won't be in North America. Due to North America's declining population rate (outlined in our Future of Human Population series), there won't be enough people to fuel US and Canadian cities into megacity territory, except for the already sizeable cities of New York, Los Angeles, and Mexico City.  

Meanwhile, there will be more than enough population growth to fuel Asian megacities well into the 2030s. Already, in 2016, Tokyo stands first with 38 million urbanites, followed by Delhi with 25 million and Shanghai with 23 million.  

China: Urbanize at all costs

The most impressive example of urbanization and megacity building is what’s happening in China. 

In March 2014, China’s Prime Minister, Li Keqiang, announced the implementation of the “National Plan on New Urbanization.” This is a national initiative whose goal is to migrate 60 per cent of China’s population into cities by 2020. With about 700 million already living in cities, this would involve moving an additional 100 million out of their rural communities into newly built urban developments in less than a decade. 

In fact, the centerpiece of this plan involves integrating its capital, Beijing, with the port city of Tianjin, and with Hebei province at large, to create a sprawlingly dense supercity named, Jing-Jin-Ji. Planned to encompass over 132,000 square kilometers (roughly the size of New York state) and house over 130 million people, this city-region hybrid will be the largest of its kind both in the world and in history. 

The drive behind this ambitious plan is to spur China’s economic growth amid a current trend that’s seeing its aging population beginning to slow the country’s relatively recent economic ascent. In particular, China wants to spur the domestic consumption of goods so that its economy is less dependent on exports to stay afloat. 

As a general rule, urban populations tend to out-consume rural populations significantly, and according to China’s National Bureau of Statistics, that’s because city dwellers earn 3.23 times more than those from rural areas. For perspective, economic activity related to consumer consumption in Japan and the US represented 61 and 68 percent of their respective economies (2013). In China, that number is closer to 45 percent. 

Therefore, the faster China can urbanize its population, the faster it can grow its domestic consumption economy and keep its overall economy humming well into the next decade. 

What’s powering the march towards urbanization

There is no one answer explaining why so many people are choosing cities over rural townships. But what most analysts can agree on is that the factors driving urbanization forward tend to fall into one of two themes: access and connection.

Let’s start with access. On a subjective level, there may not be a huge difference in the quality of life or happiness one might feel in rural vs. urban settings. In fact, some very much prefer the quiet rural lifestyle over the busy urban jungle. However, when comparing the two in terms of access to resources and services, such as access to higher quality schools, hospitals, or transportation infrastructure, rural areas are at a quantifiable disadvantage.

Another obvious factor pushing people into cities is access to a wealth and diversity of job opportunities that don’t exist in rural areas. Due to this disparity of opportunity, the wealth divide between urban and rural dwellers is substantial and growing. Those born in rural environments simply have a greater chance of escaping poverty by migrating to cities. This escape into the cities is often referred to as 'rural flight.'

And leading this flight are the Millennials. As explained in our Future of Human Population series, younger generations, particularly Millennials and soon Centennials, are gravitating toward the more urbanized lifestyle. Similar to rural flight, Millennials are also leading the 'suburban flight' into more compact and convenient urban living arrangements. 

But to be fair, there is more driving Millennials' motivations than a simple attraction to the big city. On average, studies show their wealth and income prospects are noticeably lower than previous generations. And it's these modest financial prospects that are impacting their lifestyle choices. For example, Millennials prefer to rent, use public transit and frequent service and entertainment providers that are at a walkable distance, as opposed to owning a mortgage and a car and driving long distances to the nearest supermarket—purchases and activities that were common for their wealthier parents and grandparents.

Other factors relating to access include:

  • Retirees downsizing their suburban homes for cheaper urban apartments;
  • A flood of foreign money pouring into the Western real estate markets looking for safe investments;
  • And by the 2030s, huge waves to climate refugees (largely from developing countries) escaping rural and urban environments where basic infrastructure has succumbed to the elements. We discuss this in great detail in our Future of Climate Change series.

Yet perhaps the bigger factor powering urbanization is the theme of connection. Keep in mind that it's not just rural people moving into cities, it's also urbanites moving into ever bigger or better-designed cities. People with specific dreams or skill sets are attracted to cities or regions where there is a greater concentration of people who share their passions—the greater the density of like-minded people, the more opportunities to network and self-actualize professional and personal goals at a faster rate. 

For example, a tech or science innovator in the US, regardless of the city they may currently live in, will feel a pull towards tech-friendly cities and regions, such as San Francisco and Silicon Valley. Likewise, a US artist will eventually gravitate towards culturally influential cities, such as New York or Los Angeles.

All these access and connection factors are fueling the condo boom building the world’s future megacities. 

Cities drive the modern economy

One factor we left out from the discussion above is how, at the national level, governments prefer to invest the lion’s share of tax revenue in more densely populated areas.

The reasoning is simple: Investing in industrial or urban infrastructure and densification provides a higher return on investment than supporting rural regions. As well, studies have shown that doubling a town’s population density increases productivity anywhere between six and 28 percent. Likewise, economist Edward Glaeser observed that per-capita incomes in the world’s majority-urban societies are four times those of majority-rural societies. And a report by McKinsey and Company stated that growing cities could generate $30 trillion a year into the world economy by 2025. 

Overall, once cities reach a certain level of population size, of density, of physical proximity, they begin to facilitate the human exchange of ideas. This increased ease of communication enables opportunity and innovation within and between companies, creating partnerships and startups—all of which generates new wealth and capital for the economy at large.

The growing political influence of large cities

Common sense follows that as cities begin absorbing an ever greater percentage of the population, they will also begin commanding an ever greater percentage of the voter base. Put another way: Within two decades, urban voters will staggeringly outnumber rural voters. Once this happens, priorities and resources will shift away from rural communities to urban ones at ever faster rates.

But perhaps the more profound impact this new urban voting block will facilitate is voting in more power and autonomy to their cities.

While our cities remain under the thumb of state and federal legislators today, their continued growth into viable megacities depends entirely on gaining increased taxation and management powers delegated from these higher levels of government. A city of 10 million or more cannot operate efficiently if it constantly needs approval from higher levels of government to proceed with the dozens-to-hundreds of infrastructure projects and initiatives it manages daily. 

Our major port cities, in particular, manage huge inflows of resources and wealth from its nation's global trading partners. Meanwhile, each nation's capital city is already ground zero (and in some cases, international leaders) where it comes to implementing government initiatives related to poverty and crime reduction, pandemic control and migration, climate change and counterterrorism. In many ways, today's megacities already act as globally recognized micro-states akin to the Italian city-states of the Renaissance or Singapore today.

The dark side of growing megacities

With all this glowing praise of cities, we would be remiss if we didn’t mention the downside of these metropolises. Stereotypes aside, the biggest danger megacities face worldwide is the growth of slums.

According to UN-Habitat, a slum is defined as “a settlement with inadequate access to safe water, sanitation, and other critical infrastructure, as well as poor housing, high population density, and the absence of legal tenure in housing.” ETH Zurich expanded on this definition to add that slums can also feature “weak or absent governance structures (at least from legitimate authorities), widespread legal and physical insecurity, and often extremely limited access to formal employment.”

The problem is that as of today (2016) roughly a billion people globally live in what can be defined as a slum. And over the next one to two decades, this number is set to grow dramatically for three reasons: surplus rural populations looking for work (read our Future of Work series), environmental disasters caused by climate change (read our Future of Climate Change series), and future conflicts in the Middle East and Asia over access to natural resources (again, the Climate Change series).

Focusing in on the last point, refugees from war-torn regions in Africa, or Syria most recently, are being forced into extended stays in refugee camps that for all intents and purposes are no different than a slum. Worse, according to the UNHCR, the average stay in a refugee camp can be up to 17 years.

These camps, these slums, their conditions remain chronically poor because governments and NGOs believe the conditions that cause them to swell with people (environmental disasters and conflict) are only temporary. But the Syrian war is already five years old, as of 2016, with no end in sight. Certain conflicts in Africa have been running for much longer. Given the size of their populations on the whole, an argument can be made that they represent an alternate version of tomorrow’s megacities. And if governments don’t treat them accordingly, through funding infrastructure and proper services to gradually develop these slums into permanent villages and towns, then the growth of these slums will lead to a more insidious threat. 

Left unchecked, the poor conditions of growing slums can spread outwards, causing a variety of political, economic, and security threats to nations at large. For example, these slums are a perfect breeding ground for organized criminal activity (as seen in the favelas of Rio De Janeiro, Brazil) and terrorist recruitment (as seen in the refugee camps in Iraq and Syria), whose participants can cause havoc in the cities they neighbor. Likewise, the poor public health conditions of these slums are a perfect breeding ground for a range of infectious pathogens to spread outward rapidly. In all, tomorrow's national security threats may originate from those future mega-slums where there's a vacuum of governance and infrastructure.

Designing the city of the future

Whether it's normal migration or climate or conflict refugees, cities around the world are planning seriously for the swell of new residents they expect to settle inside their city limits over the coming decades. That's why forward-thinking city planners are already devising new strategies to plan for the sustainable growth of tomorrow's cities. We'll delve into the future of city planning in chapter two of this series.

Future of cities series

Planning the megacities of tomorrow: Future of Cities P2

Housing prices crash as 3D printing and maglevs revolutionize construction: Future of Cities P3    

How driverless cars will reshape tomorrow’s megacities: Future of Cities P4    

Density tax to replace the property tax and end congestion: Future of Cities P5

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February 18, 2021. Last updated February 18, 2019.
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