Patrick Reynolds is deputy chair of the Council’s City Centre Advisory Panel.
On the back of the latest Infometrics data release, the Council through its economist Gary Blick has been publishing a whole lot of great numbers:
For the second year in a row, Auckland’s high-achieving city centre has outpaced New Zealand in both GDP and employment growth.
GDP in the city centre grew by 9.2 per cent in the year to March 2023, reaching $30.4 billion, according to the latest Auckland City Centre Overview by Infometrics. That growth rate was well ahead of New Zealand as a whole, which increased by 2.8 per cent in the same period.
These data will come as no surprise to anyone who’s frequently in the city centre. It’s busy again; and in fact feels even better than pre-pandemic, because of the series of place upgrades that have been completed.
I have more to say about the physical changes to the city, but first I wanted to check whether this is just a post-pandemic bounce or part of a longer pattern of growth. Happily, Infometrics has our back: their report contains some useful graphs with longer time series. Amidst some bumps, these show a pretty consistent upward trend.
So, the heart of our biggest city has been out-performing the wider economy consistently, if somewhat erratically, for a good while. Over the last decade it’s been over 33% above the rest of the country, and for the last five years over 50% higher, and over the last two years it’s been three times as strong!
Note that the bar chart sequence runs in reverse chronological order; read from right to left to see how the difference between Queen City and the rest of the country has been accelerating. Our City Centre is leaping out of Covid way more strongly than the whole country, based on data up to March 2023.
Blick continues:
Employment in Auckland’s city centre was up 7.3 per cent in the year to March 2023 compared with the equivalent increase for New Zealand of 2.5 per cent. Auckland’s city centre remains the largest employment centre in New Zealand, with an average of 157,500 jobs in the year to March 2023 being the highest on record – many in professional and financial service industries that support the region and the rest of New Zealand.
“These are very positive signs,” says Auckland Council Chief Economist Gary Blick.
That’s a lot of new jobs. So are these good jobs? Yes, these are very good and productive jobs:
“Estimated GDP for the city centre has grown at an annual average rate of 4.4 per cent since 2000 per compared with 2.7 per cent for New Zealand. A relatively small area of 4.3km2, or 0.4 per cent of the region, is able to generate about 20 per cent of Auckland’s GDP or 8 per cent nationally,” Blick says.
“That productivity is enabled by the presence of high value service industries that choose the city centre for its proximity to other businesses, its accessibility and general amenity,” he says.
And it’s not just construction workers building the CRL. In fact, I’m surprised by how low construction comes on this list:
This is all super interesting, because we are used to hearing all sorts of doom and gloom about the city centre. From the perennial cri de coeur of those who never go there (“a crime-ridden desert with nowhere to park”), to the complaints from all sorts of people who do go there (“too many traffic cones” and impossible construction disruption).
In fact, going by all the chatter, you’d assume the city centre was a total failure. So how to square this perception with the data?
We can start by asking what’s been different in the city centre in recent years. Indeed there has been, and continues to be, a lot of construction – particularly from the City Rail Link, and also from private development.
But hang on, isn’t that the actual point? The CRL was in part predicated on the idea it would stimulate development in the central city, as well as along the rest of the rail network. And we already enjoy a number of great placemaking upgrades as part of the CRL surface reconstruction, like Te Komititanga. In terms of both development and place benefits, the city centre is already winning from the CRL before anyone even rides it.
But surely, doubters might say, any of these early CRL wins must be undermined by all the CRL disruption? In fact, no: the city’s burgeoning success has happened while this much-mentioned disruption has been at its peak, and with the street network most disrupted, especially for anyone driving. Albert St, for example, has been closed for years. And yet the city thrives.
On top of this, we’re benefiting from the recent completion of a bunch of projects from the City Centre Master Plan [CCMP], which are all about re-purposing traffic space to people via place quality interventions. Quay St, for example, has been halved in width for traffic and radically improved for everyone, and the same is happening now to central Victoria St. The main drag, Queen St, has also had its tarmac width halved in order to double the space for strolling, with other measures designed to discourage through-drivers and anyone other than those with direct business on the street.
These reshaped streets are full of people – the tangible embodiment of the data and graphs that measure our civic success.
In the council media release about the city’s successful stats, we also heard from Jenny Larking, the Head of City Centre Programmes:
[Laking] says the council’s delivery of city centre urban renewal projects will help ensure the city centre continues to thrive into the future.
Yes, and this is the big idea behind the CCMP: that all across the world, the most successful city centres are those that reverse the post-war street hierarchy which put vehicle movement over people and place. Rebuilding streets to attract people, to persuade them to want to be there, not merely to pass through, for longer and for more and more reasons other than just to go to the office.
When the City Centre Master Plan was first devised (it was published in 2012 by the much missed Auckland Design Office), it was based on evidence from overseas cities. Many voices here, especially within transport circles, dismissed it as full of pretty ideas but unworkable for Auckland, if not downright dangerous. How could the City Centre function without being full of cars?
By now it’s pretty clear we can; the evidence is in, and we have our own proof. Enough of the CCMP has been completed to show that it works. It does what it said on the tin. City centres thrive on people, not traffic.
This outcome is even more remarkable given the impact of the pandemic on city centres everywhere – job numbers at risk from the move to working-from-home, tertiary education numbers down. Meanwhile, the CRL is still two years away from opening, the existing rail network has been in turmoil with rebuilds for years, and bus and ferry services caught a Covid workforce impact that was only fixed with great effort by Auckland Transport, Council and the government.
The Evidence and the Conclusions
Traffic lanes converted to place upgrades do bring everybody to the yard.
Restricting driving in the city centre, rather than being a loss, does correlate with this boom.
All of this is happening while streets are dug up, the tertiary sector is still down, WFH is a thing, and the transit system is struggling and incomplete, which suggests:
We should do more of the thing.
We should expect even more success in the City Centre in the coming years as these negative issues correct over time; as the CRL opens and the rail network fixes finish, with streetscape improvements like Te Hā Noa and Project K being rolled out around the new stations (with significant funding from the City Centre Targeted Rate). As we see even more apartments, hotels, commercial projects, and student flats, workplaces and homes for people in the city, building on this confidence in the city centre and its continually improving public realm.
Most importantly of all, we must complete the City Centre Master Plan to be sure to secure these wins, and spread the rewards from the super successful downtown area upwards along the Waihorotiu valley and right up onto the ridges.
It’s useful to think about how far we’ve come already. Here’s some good plain reporting from back in 2011, about the very first CCMP, by the NZ Herald’s Bernard Orsman. We’ve made a great start on this list in the last decade and a bit – if anything, the evidence says we should lift the pace.
And here’s the 2020 update to the CCMP, with the key Access For Everyone move summarised here by Councillor Darby:
“Think of it as shifting the city from a ‘drive-through’ to a ‘go-to’ city centre; we are not preventing motorists from driving into the city, rather we are providing access in a different way.
“This concept puts people to the fore and will also enable easier access for emergency vehicles and those involved in services, construction, deliveries, rubbish removal and critical business trips.
“We don’t have enough room to create another Albert Park. The only open space that beckons is the reallocation of street space. The tremendous public response reflects the fact that Aucklanders are ready and champing at the bit to have it done.”
Interestingly, as little as four years ago Cr Darby pointed to overseas examples to persuade readers: “The A4E concept is based on examples being implemented in other cities around the world, such as Barcelona in Spain.” Well, now I think we can confidently say we have our own evidence for this, right here in Auckland.
As Janette Sadik-Khan said on her recent visit:
“Our job isn’t to create a slightly less dysfunctional version of the city we have today, It’s to act as agents of the city we want to see in 5, 10, 20 years. Not just managing challenges, but innovating and taking action to transcend them”.
And that’s exactly what we’re doing. Besides, would anyone really want to go back to this place?
And it’s time to pick up the pace. So I’ll end with a question for our readers: what do you think are the most important changes we should accelerate, in order to continue this central city boom? What’s missing from the last update to the Master Plan, and should be added to the next one?
I’ll start: obviously Queen St surface light rail, but also this: Albert Park Tunnels.
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We have it very wrong according to various Chris’s.
CBD’s are in terminal decline, and are well overdue to be replaced by satellite cities.
Suburban utopias complete with super abundant car parking and everything inter connected with multi lane fully separated motorways.
Public transport, and cycles are so 19thC.
Great post. Queen St seems more bust now than anytime I can remember (going back to early 90s). It annoys me when all these boomers say its dead. Would love to see long term pedestrian counts going back to 70s, 80s if that data exists to see actual comparisons. I used to remember so much gum was on the footpaths that is was basically a poker dot pattern of black splotches, gross. So much better now!
Busy not bust*
Shout out to the street cleaners!!
Bravo. It’s great to celebrate successes.
Much achieved with much still to do, the transformation will be driven by the financial growth, it’s reported that John Key was lukewarm on the CRL but signed off under pressure from big business. Money talks and regardless of Mr S Browns own preferences, the same will continue to happen.
I think some negativity around Auckland’s city centre conflates the rise in publicly unhoused people with changes to reduce vehicular traffic. The city is more user-friendly and interesting because of the changes you’ve described above. AND more could be done to house people.
We just need better connections between the suburbs and the city that don’t require private vehicles – CRL will unlock some of that and also we need greater investment in other active modes and public transport.
Overseas experience gives best practice for dealing with the unhoused. Give them houses. A small flat and a UBI. They get off the streets and most of them stay off the streets. https://en.wikipedia.org/wiki/Housing_First
But unfortunately too many people have a *punitive* view of houselessness – that the unhoused deserve to be that way, and that they should simply suffer out of the sight of normies.
Daphne needs to visit San Francisco to see what that kind of approach to homelessness gets you. Best take your gumboots for wading through the sidewalk poop. On the plus side we’ll soon be opening some large new underground homeless shelters on K road and Aotea square.
I would like to see more of a focus on making Hobson and Nelson a better place for the residents that live there. Is there any public land that could become a park – maybe a small futsal court?
The other big issue currently is the bridge to Wynyard Quarter – there definitely needs to be better allocation of funding to this from a range of sources – local board, CCTR, regional funds.
Agree, those two need a serious makeover. I think they are always too low on the priority list, but there is no need to spend hundreds of millions transforming them. Close off a few lanes, redo the footpaths, etc.
Quite right. Last time I checked, more people live in the Hobson/Nelson block than live in Warkworth – why should they have to suffer some of Auckland’s ugliest streets on their doorsteps?
Hobson and Nelson streets were specifically identified for improvement in the 2012 and 2020 City Centre Masterplans. https://www.aucklandccmp.co.nz/opportunities/hobson-and-nelson-streets-more-liveable-green-twin-avenues/
Reallocation of space to make the Nelson Street Cycleway was a good start, but it was meant to be followed by tree planting along the car/cycleway separators….this hasn’t happened.
There were also well-developed plans for a twin cycleway in Hobson Street with the same tree treatment. I’m not sure what happened to it, but it is long overdue. As city centre population and footfall continues to increase, its public realm needs to work harder. Quay, Queen and Victoria Street all show what this looks like in practice. It should be Hobson and Nelson’s turn next.
Yes a block converted into a park around there would go well. Maybe near the convention centre.
Yes, plenty of space for that. There is a HUGE parking lot between Cook Street, Nelson Street and Wellesley Street. Right next to what is probably the most densely populated city block of the city centre.
During covid the council had a chance to take away 1 or 2 car lanes with some temporary barriers and use the space for something else. But no. I guess that was too simple. Many apartments are a surprisingly long walk away from any park.
I am eternally wondering why the council even tolerates this situation. They must be collecting more rates on that one city block than on my entire current suburban street. How damaging is this for the public perception of high density?
Every spring, you can observe the trees on Hobson Street getting green again. It could be a great urban avenue.
It would be interesting to compare the amount of rates paid by occupants of Hobson and Nelson vs the entirety of Warkworth, and then put that beside the amount of expenditure on those areas.
Yes, good idea.
CCRG have recently requested a bit of data.
The economic value of residents here.There’s been work on the economic value of a range of CC ‘users’ but strangely, never residents as a whole.
Also have requested breakdowns of how much residents and businesses are paying. in CC targeted rate, by precinct.
(unfortunately the residential portion of annual targeted rate is very low – about 5% of the total ( c$25m annually).
Our battles to get better amenity, hey even a decent footpath in that quarter continue, and yes reminding AT how many people live there and the rates they pay is always mentioned. There’s always $$ available to resurface Hobson and Nelson streets regularly.. Victoria Quarter has a chunk of $$ being allocated in next round of CCTR projects, but it is so behind. We are going to have to be a lot more tactical and do a lot more that way. That’s why getting the A4E circulation plan done is so important – it ‘drives’ the ability to create something similar to detuned neighbourhoods or LTNs.
The only serious solution to Hobson/Nelson is restore them to two-way operation. You can’t have a decent living neighbourhood on a one-way traffic sewer.
Actually, you can have civilised one-way streets. Barcelona has been doing this for years. Two-waying solves some problems but it is certainly not a panacea and it costs a lot of money to do properly.
Yes. I agree that Hobson and Nelson need an urgent focus. I would put this area way above the wharf questions in the LTP, for example.
Daphne, I agree with George that one way streets can work fine. The key element needed first is: fewer traffic lanes. Each of these streets should be reduced, in the first instance, to two lanes only. (Cry me a river, WK.)
The supporting element needed is: Fewer carparks in the city centre. Far fewer.
The one-way thing is a distraction. It is actually much easier to cross Hobson street than Cook Street, because it is one way. The key thing is to not have 4 or 5 or 6 car lanes, and less on-street parking.
Build south-facing SH1 ramps at the north end of the city, so that Nelson and Hobson don’t have to serve as the motorway ‘ramps’ to and from Fanshawe St/ Customs St. Looking forward to suggestions on how that could be done, to attract some of Simple Simeon’s funding.
Can you explain a little more, Streetguy? And within the context of our broader goals?
Ramps will be added that allow for entrance to the southbound motorway and exit from the northbound motorway at Fanshawe Street. This way, there will be no more traffic on Nelson Street and Hobson Street.
That sounds horrible, particularly for Victoria Park.
Hobson and Nelson just need to be calmed down, boulevard style.
Thanks Hiker. Clearly if ramps had been designed from the start with Low Traffic Neighbourhoods in mind, they would be arranged differently.
However, building new ramps is about as far from a cost-effective approach to solving our problems as is imaginable. We need to make better use of the assets we have, not continue to waste scarce funds on building extremely expensive motorway ramps! There are too many other things that money could be put towards; things that are more effective at repairing our city, reducing traffic, and that are a fraction of the cost.
This is a good demonstration of the difference between paradigms in transport planning. It’s also a good demonstration of how to look at funding differently:
Is it worth Council paying 50% of motorway ramp building projects just to get Government to fund the other 50%? Of course not. That Council money could achieve infinitely more with modeshift, safety, place and reallocation projects, even if there’s no contribution towards the projects from a backwards-looking roads-focused Government.
Both AT and Council need to focus on doing what needs to be done, not on playing their cards to get Government funding, if that involves high-carbon, traffic-focused projects.
Here’s a simpler plan. We get some timtams and reduce both streets to 2 general traffic lanes. Maybe keep the bus lane on Hobson Street. Make the lanes reasonably narrow so a 30 km/h speed limit makes sense. Let’s see what happens.
A potential problem is the queue in the afternoon on Hobson Street to enter the motorway. If you reduce the lanes the queue gets longer, potentially gridlocking other streets.
Don’t have anything insightful to add, just last time I went to the CBD for a haircut and trip to the art gallery it was really nice. Places to sit and people playing music, good time
As a City Centre resident who returned from the suburbs, last year; after five years in driveway hell; I can completely agree with this sentiment. With the increase of pedestrian friendly areas, the ease from a ferry, train, and multiple buses to access particularly downtown; and the CRL to open up midtown and Karang a Hape; the CBD can only move upwards.
My only gripe is the lack of residential accommodation but Wynyard Quarter is working positively, and some developers are still building apartments so there is hope for this hopelessly double garaged quarter acred psyche!
This suggests the City Centre could be made stronger still by extending the apartment zone in Auckland. Perhaps those who want to avoid higher density housing in their suburb could be persuaded that this can be done by making it easier to build central city apartments.
Thanks for this article, Patrick. It’s very powerful to juxtapose the economic figures with the experience of being in the city centre which is bustling, particularly in the areas that have made the most improvements to their public realm. It also vindicates the notion that agglomeration drives wealth.
Auckland city centre embodies this realtionship. In other words, you don’t make a city wealthy by spreading it out, but by making it as easy as possible for many people to get there (i.e. public transport) When they *are* there, make it as pleasant as possible (i.e. attractive streets, spaces and things to do).
There are eight transformational moves in the City Centre Masterplan and all of them are fundamentally about transport and accessibility. CRL, plus further public realm improvements, will make a big difference.
https://www.aucklandccmp.co.nz/transformational-moves/
I have high hopes for the Ngati Whatua/Precinct plans for the rail yards east of Britomart.
Another neighbourhood similar to Wynyard and a pretty fantastic looking stadium.
Turn Eden Park into another Wynyard, and also the Dominion interchange, and the surrounding areas to city centre look amazing. Builds pressure for more connected cycleways and surface LR which in turn feeds into the city centre success
Yes, the Quay Park stadium proposal (with private money) would really turbocharge redevelopment of that area. Needs a Strand Station on the eastern line, eventually.
Perhaps the next big challenge is to ensure the people who live in the cc have everything they need. Does that growing community need its own primary school, for example. Also, anything that will make it safer 24/7.
Can any history buffs tell us where the schools were in the City Centre “back in the day” before the 60s-90s depopulation?
I think it’s all the same as now; in the surrounding areas. Parnell, Freemans Bay, St Mary’s Bay, Ponsonby.
There was the kindergarten in Myers Park too.
There were also Newton East School (where Alex Evans Dr is now) and Newton West School (now the Army HQ on Great North Road), plus at least 1 Catholic school in Freemans’ Bay. But my question was were there ever primary schools in the Central City and the answer is no?
108 Greys Ave?
Once when I stayed at a hostel in Parnell there was a plaque saying there had been a school at a site that is now a park. The site was sloping and the school had probably been small. Checking old maps and annual reports might help.
In Wellington you could create new school sites by using very wide inner city street that are mostly parking and building on the fringes of parks. Increasingly school grounds are surrounded by a high fence, but they could be unlocked outside school hours.
What’s next: surely a protected bike/scoot link up Wellesley St, linking Queen St to the Art Gallery and the University, and then through to the Grafton Gully path and onwards to the Museum? Great for locals and for visitors, feels like a no-brainer.
It’s on the Waka Kotahi list of “key projects” for Auckland Network Optimisation (albeit worryingly short of actual details, and no link to a project page): https://www.nzta.govt.nz/projects/auckland-network-optimisation-programme/
Really need to press on with PT priority measures, full bus lanes (eg Customs st), camera enforcement, bike lanes. Network effects as CRL opens, etc – linking with the ferries, buses.
Small things, Wynyard bridge, bollards to protect pedestrian spaces, good wayfinding, more music/performances.
Change people’s mindset from driving to town to park to using multiple forms of PT and active transport.
I always thought it would be good to rip out spaghetti junction and grafton gully motorways and fill them with water to make a moat.
I would offer two suggestions for the city centre. Keep tight restrictions on height. If we want to create areas that people want to go to the we need more viaduct height areas of a hum a scale and less 40 storey towers.
Secondly the connections between the city and the domain are not great. Perhaps covering some of the lower parts of the motorway could be done somehow? So people can walk between the university and domain.
Moat lol.
Vancouver is a brilliant city centre with plenty of tall buildings. I wouldn’t be advocating for height restrictions, Auckland already has plenty (maybe too many?) viewshafts to limit development.
Building height has nothing to do with it, aside from more stories / floor area providing more people for the area, and providing some relief from the brutal sun.
It’s all about the nice pedestrian first streetscape, and many street facing businesses. Could be replicated up queen street and in fact that’s the plan.
A moat’s a great idea. But couldn’t we just decolonize the downtown by removing all reclaimed land, build a wall around the original shoreline high enough to simulate future predicted sea level rise and fill the CBD with water? The ability to paddle board, kayak or take a traditional waka down city streets would be magical. We could then market Auckland to tourists as the Venice of the South Pacific but with a unique kiwi cultural twist. The whole debate of cars vs bikes vs pedestrians would become moot. Homeless people would simply float off somewhere else, and it’d be nearly impossible to make a demio float well enough to escape from a crime spree. It’s also a very future looking adaptation to climate change. Why anguish over that for century and deal with it later when you can just get it over and done with now?
It would slow down cars. So no chance.
That’s the whole point. The regressive dinosaurs who wanted to drive there will have been permanently dissuaded from ever doing so meaning no debate about cars in the CBD need ever happen again. Also the denizens of the CBD will never have to worry about global warming. It’ll be a paddle board, kayak and waka paradise just like the old days before the invention of roads, all the way from the Waihorotiu river to the sea. The CRL will probably sink without a trace but that’s a small price to pay for all the above benefits, at least to people who consider 5.5 billion to be a small price…
Yes please to the Albert Park Tunnels. They would be iconic.
Restriction on heigh is not the way. I get the appeal, but land in the CBD is worth too much, and the more people living there the better. Restricting height in the CBD is no better than NIMBYs in Mt Eden restricting Apartments and Attached units.
Great post, thanks. Yes to accelerating **all** of the CCMP. Notably:
The Low Emissions Zone.
A4E.
Symonds St, Nelson St, Hobson St, Fanshawe St.
One more thing that’s critical, and I see CCRG tweeted about it a few months ago: NOISE. Traffic noise, yes, (and Queen St is so much quieter now than it was; I love it!)… but also ventilation noise.
For example, we’ve discussed Aotea Square many times… but only recently I’ve figured out why it is so unpleasant as a public space for me. It’s the ventilation noise. The stack coming up from the underground carpark is constant and headache-inducing, and this is true even on a Sunday when the number of vehicles actually emitting fumes down there will be next to none. They need to shift it to air quality sensor activation. Then there are some ventilation systems from some of the surrounding buildings that are also noisy.
The waterfront east of the Viaduct still needs a lot of love. Captain Cook should be a green park jetting out into the harbour. Queens Wharf needs decluttering (and a bit of greening) and getting rid of the Cloud would be the best thing.
Look at what Sydney has done with Barangaroo (less the high rises) and provide an inner city beach-type area.
To contradict myself, for Queens Wharf, we could bring back Shed 11 in place of the Cloud. It could be an events facility doubling as cafe/waiting space for the ferries. Plant some trees around it.
Wynyard needs a permanent active mode/tram bridge as planned – paid for by the CBD targeted rate. That’s probably the only must have, I’d love to have the Albert St tunnels, but will wait for the next article on them.
The rest is just incremental improvement (extending bus lanes/streetscape improvements etc.) – and sorting out the dodgy peeps in the CBD. Private developers are the ones who’ll make and break the CBD – as shown by the crap landlords of Queen St floundering while the nicer ones nearer the waterfront doing great.
Maybe Wellingtonians could benefit from reading this….
I just read it.
I thought productivity and GDP were two different things. GDP is a sum of earnings or expenditure (divided by the population to get per capita). Productivity is the ratio of outputs to inputs. The $192,000 per person will presumably be an average earnings or salary. It will be biased by the number of CEOs and executive of large companies based there. It tells us nothing about their individual productivity and doesn’t in any way suggest moving one more person in will increase that persons productivity. All we know is some highly paid people work in the CBD.
City centre, not “CBD”. People live here.
Word Nazis.
GDP is total economic activity, not typically defined per capita. The GDP increase is significant, and the per capita view of it is also interesting but as you say does not reflect productivity, but it also does not reflect individual earnings. Overall, it is a good sign for the city. We should accept that moving forward there will be people working from home, and this is a good thing. It gives us more capacity and time to redefine the city.
Thanks Patrick. Excellent news on the productivity stats for our biggest city.
Lots to be optomistic about, and many things to “do more of”
Im stunned with the 60% reduction in Road Deaths for Franklin that AT achieved – but in no way celebrated. Kind of kept it quiet.
These success stories, backed up with evidence seem less important than the Browns on speeding up our roadways for not only the economy but also safety (the Waikato expressway is 110k and safe says our Minister of Transport)
What to do in a post fact, science or evidence world. Let us pray for those who we are about to sacrifice.
Anyone I know does anything they can to avoid going to their CBD office and would rather work from home instead for the max time their employer allows. But this simplistic analysis by the city council likely imputes all their economic output to the CBD where they are recorded as being employed vs pro-rating it to the suburbs they are actually WFH in and prefer to work in for most of the week.
I bet the productivity and GDP numbers don’t look so flash if you adjust them for where the ‘CBD’ workers are actually doing their work from.
What productivity numbers? I don’t think anyone measures inputs and outputs at a fine grain. Local government economists tend to be little more than a public relations person who can do some maths.
Anyone I know wants balance. They don’t want 5 days in the office and they don’t want to go brain dead, stuck on their own at home 5 days week either.
Thanks to everyone for your comments. Excellent.
Statistics, I not sure this is such an issue, the fact remains that without the city and its locational benefits, the role, work from home or not, wouldn’t exist.
Remember the most expensive real estate is in the city centre so there is a major revealed preference here. And if, which is obvious the case for some, the office is in a suburban business park or somewhere else not in the city centre, wfh or not, it will get counted for that statistical area. The job is still in the city centre, where you work on it may not always be.
Additionally most wfh still involves some in person action, in fact most evidence suggests ‘hybrid’ in office/wfh is the more common model. This is supported by the PT data (see Matt’s recent post) which shows more individual users, but fewer trips per user.
Which incidentally is great for transport networks, breaking the dominance of very peaky diurnal flows, the commuter, may not be dead, but she is less herd like.
So like ‘CBD’, referring to urban transport users as only commuters is even less accurate than it used to be (work trips only make up ~20% of the total).
Now if we could only get public agencies to stop calling us all ‘customers’ too… but I digress.
Patrick that’s big assumption that without city centres roles wouldn’t exist. If the business has need for a role it’ll exist somewhere.
And according to Forbes 98% of workers want to work remote some of the time and most would look for other work if their employer didn’t allow it. Now in the US less than 57% of office roles are full time in office. Pre covid few would have predicted that level of shift.
New Zealand can be a bit behind overseas trends and also the ‘Hermit Kingdom’ approach to Covid probably had less people in New Zealand getting quite so used to WFH so perhaps employees here are a little behind global trends in what they will accept and also have fewer options in any given field.
But my comment was more with the method. Some significant percentage of the GDP and productivity you impute to the city centre is actually generated in the suburbs, on international numbers perhaps around a third of it. Which when you deduct from ‘CBD’ and add to ‘Not CBD’ would reverse your ‘CBD’ and ”Not CBD’ numbers.
On international averages the most high value and highly educated employees are not in the CBD much of the week nor wanting to be there when they are.
If GDP or productivity is being used to justify transport investment I’d suggest adjusting numbers for time the employees are actually in the CBD rather than the time they are there on paper only.
This is indeed a good thing, breaking dependence in the idea that the lemmings need to flood into a city centre and out again each day to get things done. But it also has future implications for those building transport systems around the idea that that kind of flow is what needs to be prioritised at the expense of all other options. It also has implications for businesses that exist primarily to service those customers.
One thing is for sure, this work from home sure means our cities should be able to withstand a lot more population boom.
I also wonder where the profits of say Fontera are assigned to if their head office is in the central city.
Infometrics approach to the employment and productivity numbers uses employee’s stated address for tax purposes, there’s no indication any adjustments are done to account for the WFH split. For regional estimates that probably doesn’t matter much where most employees will have a work address in the same region as their home. And pre covid some level of WFH was rarer while now it is the norm. The GDP and productivity estimates use the LEED dataset as an input which uses nominal employment address only. So obviously when trying to produce a city suburb level split it’d bode them well to start thinking about using both employee recorded location, WFH ratios and home address.
Perhaps Patrick as presenter of the statistics could comment on what if any adjustments are made for the WFH split because without adjustments for that we’re well into ‘Lies, Damn Lies and Statistics’ territory.
And WFH indeed means our suburbs can shoulder the load much more in terms of being the ‘office’ from where people work but the numbers presented above either purposely or due to inadequacy of source information ignore the contribution of the home office to non CBD GDP and productivity numbers. But a hand waving estimate would suggest since covid the city’s lost around 30% of its recorded GDP and productivity to home office work.
No I’m still gonna disagree with this. I don’t think it’s such big thing for these data, the fact that you, working from home, didn’t buy lunch in the city is already captured, or had meeting and drinks in Glenfield or wherever, there will be a bump for those places and a decline for the city. So that the CC is doing so well, despite WFH, as I say in the post, is even more impressive.
If WFH is as large as you claim (and i note employees may say they like it but increasingly employers say they don’t, and are reducing it) then office footprints will fall etc, so like with the lunch example, the ‘from home’ impacts of this change will be largely picked up in the numbers.
And yes we are seeing interesting changes in office occupancies, but not the huge declines predicted by the usual voices of urban loathing, nor the sorts of wild swings observable in some US cities (especially those with housing supply crises and horrible congestion).
Really where your monitor is, is a minor thing for these numbers.
This is all too hair-spilty too I think: Are you also going to insist that when a city person or office orders something from a business in Albany thereby increasing the recorded GDP there, yet uses it in the city, that this is a outrageous distortion of the numbers?
WFH is different to dispersal. That late 20thC ‘solution’ to urban issues, that did set out to, and achieve a hollowing out of CCs, that as we now know largely made things like traffic congestion and efficiency and productivity worse.
And Grant I have asked about this before, and no the output of Fontera plants are not all located to head office, they are all counted as local. Do agree with your point about how it can change the city positively, at the CCAP we have commissioned work on barriers to accelerating residential growth in the CC. We see the diversification of use and occupation of the CC as positive and wish to encourage it.
In this, as with effects on commuter patterns, i think WFH, wherever it settles, is likely to have a positive impact on both the CC and the ‘burbs, should be a win/win:
‘Humanise the city and urbanise the suburbs’
Patrick you’re directly imputing their entire economic output to the CBD based simply on their employment address registered with IRD being there. I’d agree 5 years ago the distortion to the information would be quite small, but now it’s quite large even if you assume on average only one day WFH per person. For sure the effects on cafes will be ‘picked up in the numbers’ but only in the numbers for cafes, and cafe customers served might be quite highly correlated with the number of people in the city any given day. But the actual split of location where an employee generates the economic output won’t be affected unless someone says, “well the address we give to the IRD for tax is in the city and in the old days that was a fairly good proxy for where they actually worked on a daily basis. That’s not so true any more, so instead we need to come up with a methodology to start adjusting for the work from home percentages, if we even care, since it’ll make our city numbers look worse and suburban ones look better”
As for office space, low vacancy rates don’t mean the space is actually continually occupied. And a trend you’re likely already seeing is either that space sitting idle more of the week, or a smaller CBD footprint with smaller spaces per person in the office and more strategies like hot desking in companies that are embracing WFH more.
I agree the whole WFH trend will take a while to shake out and there’s a definite attempt by many employers to put the genie back in the bottle. But one key takeaway is that the majority of employees love some percentage of it even if employers don’t. To the extent one side or other wins depends on the relative demand for the services. It’s been noted that the higher somebody’s education level is the more likely they will succeed in being able to work from home for a greater percentage of the week.
And I don’t have too much of a problem with a sale by an office supply company in Albany being recorded as economic activity generated by a business in Albany. The economic value the CBD business adds by using whatever it brought will presumably be correctly recorded against the CBD. But I do have a problem with economic output of an employee being used to increase the CBD’s numbers purely because of where the company chose to give the IRD as the employee’s ‘place of work’. If that was a 5% or 10% error it’d probably be at a level where you’d ask is it really worth trying to correct for given the likely lack of good data to do so with. But it’s now likely much larger than that. The outflow of economic value generation from the CBD due to this effect likely exceeds the recorded growth numbers and on a quick hand waving analysis it’s hard to see how this hasn’t actually made CBD economic growth negative over the time periods you mention.
So caution should likely be used in inferring too much from CBD vs Auckland figures especially when it comes to deciding where to invest in public projects. One should be aware of the fairly substantial inaccuracy in the statistic being quoted.
If the main office/get together location is in the central city, then it’s core “business” is in the central city if you ask me regardless of some workers working from home part of the time. This would tend to all average out as I bet there are city dwellers working from home that their business is in a suburb. Also someone working in the Auckland for a Wellington based business for example.
After this blog this video was made funnily enough, where reverse commuting is looked at in North America.
OK, Grant carrying that on further if the main get-together for collaboration is in Slack, Teams or Zoom do the people work in a data centre somewhere overseas? Should a nice public park be built outside that data centre for them?
For many purposes it’s a harmless error and simplification to just impute all the WFH work to a central city location and historically maybe not too bad an approximation.
But when talking about where to place and improve facilities and services for people it matters where the people actually are during the week not where the IRD thinks they work.
Patrick, it’s not an ‘unknowable random number’. A lot of imputation of GDP to cities is based on inferring numbers from available information and surveys and it may not be as easy a process as you believe it to be compared to say measuring whole country GDP. It’d be easy enough to add a WFH survey to understand how often CBD workers are in the office vs not to get a percentage to refine that split. Even without that it’s easy to come up with some estimates of likely high and low bounds for it on known information.
To assert it ‘Comes out in the Wash’ would require at least some investigation to actually show that. Pre covid I’d be prepared to believe it was a relatively small percentage error. Post Covid it’s clearly not. From a hand waving analysis many more people with a CBD office work from home at least a day or two a week than run a home businesses and commute to the CBD every day.
From a March 2023 survey 60% of kiwis have some ability to work from home, 35% state their job can’t be done at home, and 5% that their employer simply doesn’t allow it.
About 80% of those that could WFH do and half of the WFH group quote company policy as being the barrier to working from home more.
Possibly in solving Auckland’s traffic woes lobbying employers to allow more WFH (which a majority of employees clearly state that they’re up for) could produce a greater result than a lot of other initiatives. That of course comes at the expense of ‘bringing life back to the CBD’ so may not be a particularly attractive approach for CBD enjoyers or pro CBD lobby groups.
And I absolutely prefer not to go to a CBD and I do predict more WFH and non CBD sites in people’s future. And the demand for it from employees is clearly there. And the least impactful and cheapest to fund transit journey is the one that never happens.
But the numbers don’t depend on my preferences. They exist independently. When using any statistic it’s important to know what it actually measures (unless you’re merely looking for one to confirm an existing bias, promote a particular project etc..)
I think Grant is right, and is certainly much more workable than your; “I have decided it’s 30% somewhere else”. An unknowable random number. Anyway surely the most important information here is change over time, so keeping methodology constant is important for that.
I get it’s your preference and looms large in your mind. But let’s take me as an example, my business has always been located at my home which is not in the city, but almost every single day I am in the city centre prosecuting it. This process will likewise apportion 100% of my businesses activity to Grey Lynn. It all comes out in the wash.
Can someone clarify the geographical definition of the City Centre that you’re using? In the past the Auckland City Council defined it approximately as within the motorway loop. Does it now include wider area e.g. Parnell and Ponsonby?
I recall some transport planners saying more than 57,000 jobs commuting in would gridlock the city…. but now if we have 157,000 FTES, PT must be working.
Hi Terry the geography is here:
https://rep.infometrics.co.nz/auckland-city/geography
Is the motorway noose + the bit of K Rd just beyond it.
yes PT does work there, it will be better in the years ahead but the city centre is one place in AKL that is pretty much fully accessible by PT now. Which means of course it could have a pricing cordon on it anytime that was politically backed.
Where you are certainly wrong is asserting that i think WFH is ‘bad’ or a threat to the city, I absolutely don’t, and mentioned its positives. I literally hold that it is likely good for both the centre and the ‘burbs, and our transport networks, so i have absolutely no skin in any argument about whether it is happening or not (it is).
What i said in the post is that the City Centre is thriving despite it and several other things (fewer students, construction disruption, PT disruption) that all are surely impacting economic patterns. You literally said the CC can’t be thriving, the data must be wrong, cos you ‘and all your friends’ don’t like to go there.
An alternative explanation, and one for which there is evidence, not only in GDP data, but also in returning and changing PT ridership (lower peak of the peak weekday, higher all day and weekend) and CC residents, is that the CC is broadening its action to other markets. Away from so many diurnal weekday screen warriors shuffling in and out and growing other markets, especially in retail and entertainment.
Which i think is good, better in fact for everyone. This also has policy implications, which are also explicit in the post: we should continue to invest in this broader more diverse urban economy, absolutely lean in to this city of the future.
I think we agree; that old city of commuters being forced to go somewhere they hate 5 days a week is dead or dying and is unlamented. I have no interest in, and have been saying so for years, the 20thC ‘CBD’ urban model is bad and low value, and believe any attempts to return to it and the urban form it created is the road to failure for cities everywhere.
Hang in there for another 6 weeks (ish) and the data from the 2024 City Centre Public Life Survey should be hitting the streets live and correct, the findings of which will add meaningful value to this conversation.
Looking forward to it! 4 weeks now and counting
As a CBD Resident this is what gives me ongoung muitple heart attacks
> The lack of big Format Shoping!
-DESPERATE FOR A PROPER FULL Warehouse! PLus Actual Furniture stores, Way more MENS clothing which are ACTUALL STOCKED, PROPER Electronics STORES..
OH I am crying again as Heavenly “.. store Surplus electTronics – being replaces with ANOTHER alchol store 🙁
OMG – Firstly Wayne Brown and Many in Authority really should prociscute many corporates which lie under a number of acts and ask Corporates to please setup a full size version of thier Offering in the CBD – There is AMPLE space availbale Basement buildings or even high rises for such
Anyone One company who should have their License on hot coals is the WareHouse CBD – The are lying = go a license to trade in the CBD
–
Us Apartment livers need to buy furniture like OTHERS.. yet the warehouse in the CBD is a con like many in the CBD. They sell nothing really except shoes, few cloths and soaps and a few dishes (Actually destroying the little shops that did provide that in the CBD and NOTHING llike proper furniture, Gaming stuff, Fishing gear, And a billion other useful things!
Also Mayor should do what he can to get all the fast food companies back into the CBD what ever needs, the full offering again.
Also lacking in CBD :
PLEASE! K Mart ( A FULL STORE) A Jaycar/DickSmith electronics :(, A WALLMART please get them to setup here, a proper discount Fashion store Cotton On uses to stock proper mens stuff not anymore.
ALL THE BANKS should be FORCED to have a Queen Street branch
AND OF COURSE A Bloody Hardware Store.
Anyway.. To upset to think how much Auckland CBD has been killed since my love in the 90s too upset, so
Auckland was actually perhaps the BEST CBD in the world in the 1990s.
Sorry spell Checked now
As a CBD Resident this is what gives me ongoung muitple heart attacks> The lack of big Format Shoping!-DESPERATE FOR A PROPER FULL Warehouse! PLus Actual Furniture stores, Way more MEN’S clothing which are ACTUALLY STOCKED, PROPER Electronics STORES..OH I am crying again as Heavenly “.. store Surplus electronics – being replaces with ANOTHER alcohol store OMG – Firstly Wayne Brown and Many in Authority really should prosecute many corporates which lie under a number of acts and ask Corporates to please setup a full size version of their Offering in the CBD – There is AMPLE space available Basement buildings or even high rises for suchAnyone One company who should have their License on hot coals is the WareHouse CBD – The are lying = go a license to trade in the CBD
–
Us Apartment livers need to buy furniture like OTHERS.. yet the warehouse in the CBD is a con like many in the CBD. They sell nothing really except shoes, few clothes and soaps and a few dishes (Actually destroying the little shops that did provide that in the CBD and NOTHING like proper furniture, Gaming stuff, Fishing gear, And a billion other useful things!Also the Mayor should do what he can to get all the fast food companies back into the CBD whatever needs, the full offering again.Also lacking in CBD :
PLEASE! K Mart ( A FULL STORE) A Jaycar/DickSmith electronics :(, A WALMART please get them to set up here, a proper discount Fashion store Cotton On uses to stock proper mens stuff not anymore.
ALL THE BANKS should be FORCED to have a Queen Street branchAND OF COURSE A Bloody Hardware Store.Anyway.. To upset to think how much Auckland CBD has been killed since my love in the 90s too upset, soAuckland was actually perhaps the BEST CBD in the world in the 1990s.
When you’re in the CBD you’re always only a short train or bus ride away from civilisation in the suburbs. You can’t force businesses to set up in places where it is neither convenient nor desirable for customers to go to.
Hardware store = Placemakers Cook Street