New report is bullish on the 'burbs. Should we celebrate?

The center of gravity is shifting to Greater Boston’s suburbs.

 

That’s the key conclusion that caught my eye in a just-released report exploring how the post pandemic recovery will impact work, commerce and life in our footprint and across the state.

 

And if you have a vested interest in the economy of our western 'burbs, you’ll want to pay attention.

 

“Suburban Greater Boston communities may be the natural beneficiaries of the future of work trends, with potential for increased vibrancy as remote eligible workers spend more time closer to home,” concludes the consulting firm McKinsey & Co. in a study commissioned by the Baker administration.

 

McKinsey is bullish -- or is it less pessimistic? -- about Greater Boston’s suburbs (defined as neighborhoods within 20 miles of Boston) in part because it forecasts dramatic drops in office demand (down 20%); commuter rail usage (down as much as 50%) and business travel (30% decline) in Boston and Cambridge.

 

But Boston's and Cambridge's losses may benefit us economically.

 

“According to our modeling, Suburban Greater Boston communities in Massachusetts’ ‘knowledge core’ may become natural beneficiaries of future-of-work trends,” they write.

 

“These areas have a higher proportion of residents who work in sectors that lend themselves to remote work (such as professional and scientific services, finance and insurance), so residents may spend more time close to home, thus creating more vibrant residential communities and local downtowns.”

 

Fewer trips downtown and more remote work, could result in increased retail activity and spending in the 'burbs -- a market McKinsey says currently represents 30.6 percent of Massachusetts’ total population and 33.1 percent of the state’s total employment.

 

“This in turn could also boost the vitality of Suburban Greater Boston, as new local businesses open, increasing area attractiveness,” authors conclude.

 

 

Suburban Boston communities may be on the receiving end of this economic shift but McKinsey warns that our growth will be hampered "by limited affordability and housing inventory” and a need for up to 200,000 new housing units statewide by 2030.

 

In addition, the shift would likely exacerbate demand for childcare – a sector that’s already facing a staffing crisis -- as workers seek solutions closer to home.

 

And then there’s traffic.

 

McKinsey’s models predict up to 4.5 percent of the Suburban Boston population could shift from transit to auto commutes by 2025. Add in more growth and an increase in e-commerce deliveries and our gridlock could soon become even less tolerable.

 

 

“You may see the center of gravity, for lack of a better word, move a bit, or maybe we’ll end up with a bunch of centers of gravity,” Gov. Charlie Baker tells the Globe’s Jon Chesto. “People will have more options with respect to where they work and where they live than they’ve had before.”

 

While increased economic activity and more vibrant suburban town centers would be great news for our chamber's communities and businesses, let’s never forget that Boston proper is the economic engine that drives our region’s economy and competitiveness.

  

And our suburbs don't win when Boston loses.

 

State officials tell Chesto that “they are acutely concerned that women and people of color will see their earnings potential fall further behind.”

 

McKinsey estimates as many as 300,000 to 400,000 jobs -- primarily those with lower average wages in concentrated immigrant and minority communities -- will be phased out over the next 10 years if the pandemic-accelerated trends around automation, e-commerce and digitization continue.

 

"Massachusetts is among the lowest ranked states for affordability and has some of the highest housing costs and most expensive childcare services."

 

So yes, let’s reap the benefits of our new suburban advantage. We love it when our members make money.

 

But we must also advocate for major investments in job training, workforce housing, early childhood education, immigration reform and transportation to remain competitive and equitable while combating the impact of climate change.

 

Let's leave it there for today. The chapter of the McKinsey report about Suburban Greater Boston begins on page 61.

 

Onward!

 

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