Top 3 challenges brought about by urbanization

Top 3 challenges brought about by urbanization

Urbanization will present challenges on a massive scale. About 55% of the world’s population currently lives in cities, according to the UN, and projections call for this number to increase as rural populations shrink. Not all cities are growing at the same pace, however. By 2030, roughly one-sixth of the world’s population will live in just 41 very large cities—each with a population of more than 10 million people. That kind of concentration among populations can create conflicts—and greater urgency for city governments—in three specific areas:


Economic Competition Among Cities. Large cities often siphon capital and business activity away from smaller cities nearby. And because concentrated populations lead to increased economic opportunities—an effect that becomes self-reinforcing—large cities win and smaller cities nearby lose. New development and infrastructure can sometimes intensify the problem.

In 2008, for example, the Chinese government built a high-speed rail line between Wuhan and Guangzhou, cutting the travel time between the two cities (roughly 600 miles apart) from 11 hours to about 3. Slower trains used to stop at those cities, but the high-speed line did not. As a result, the populations of many of the smaller cities along the route experienced a net decline from 2008 to 2016, while the populations in the cities at either end of the line increased significantly, accruing economic benefits.


Concentrated Opportunities. According to one estimate, 5% of the world’s cities in 2030 will contribute more than one-fifth of the world’s GDP. This concentration of economic activity can lead to greater income disparities between the populations of large cities and small cities. Even within the limits of any individual city, wealth accumulates at the top, leading to a growing split between the rich and the poor and, in some cases, social instability. In the US, among the five cities with the highest per-capita GDP, four of them— Boston, New York, San Francisco, and Washington, DC—also show the highest gap in incomes. Only Seattle has managed to keep the income disparity down.


Environmental Challenges. A concentrated population allows for the delivery of more efficient public services, but as cities grow bigger, governments often struggle to meet the needs of larger populations. Currently, about 35% of the world’s urban population faces either inadequate or unaffordable housing. Residents in the 25 largest cities lose an estimated 66 hours per year sitting in traffic jams—and increased traffic leads to increased pollution. Only 10% of the global urban population lives in areas that currently meet World Health Organization standards. The environmental challenges grow as cities expand in size, and the effect is most pronounced in developing economies, where the majority of megacities are located.


To solve the problems of urbanization and to design livable, sustainable cities of the future, governments need to adopt a far more strategic approach, of which technology is only one part. They need clear upfront analysis to identify the biggest issues that their cities and constituents face, and they need to design collaborative and citizen-centric solutions that use technology to address various functional clusters: energy, mobility, environmental sustainability, public services, and buildings. This is potentially harder and more time-consuming than simply buying software from a vendor. But it is the only way to generate sustainable results.

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