A Tale of 25 Cities in Australia 2017

Lawrence Pratchett Richard Hu Michael Walsh Sajeda Tuli 1 ISBN: 978-1-74088-456-3 The neXus Research Centre Faculty of Business, Government and Law University of Canberra Australia 2017 2 neXus: research at the neXus of business, government & law The neXus Research Centre at the University of Canberra provides a meeting place for all researchers and scholars in the University and the broader Canberra community interested in the interface between the institutions of Business, Government and Law. We believe that these institutions play a crucial role in framing Canberra, communities, citizenship, and especially with respect to the future of knowledges from an Indigenous, Canberran, Australian, South- East Asian and Global standpoint. For further information on neXus visit: http://www.canberra.edu.au/research/faculty-research-centres/nexus-centre-for-research Acknowledgements We are grateful to the following colleagues for their comments on earlier drafts of this research: • Martin Heir, Rose Verspaandonk, Tiffany Heaslip, Department of Employment • Ayman Malik – PWC Canberra • Narelle Powers, Australian Public Service Commission • Cameron Pitt – Deloitte Canberra • Professor Gerry Stoker – Institute for Governance and Policy Analysis, University of Canberra • Assistant Professor Sarah Maslen – Faculty of Business Government and Law, University of Canberra A note about the authors Lawrence Pratchett is Dean of the Faculty of Business, Government and Law, and Professor of Politics at the University of Canberra Richard Hu is Professor of Urban Planning and Design in the Faculty of Arts and Design, and Fellow of the Institute for Governance and Policy Analysis, at the University of Canberra Michael Walsh is Assistant Professor of Social Science in the Faculty of Business, Government and Law at the University of Canberra Sajeda Tuli is a PhD Candidate and Research Assistant in the Institute for Governance and Policy Analysis at the University of Canberra 3 “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair...” Charles Dickens, A Tale of Two Cities (1859) 4 TABLE OF CONTENTS 1. Is It the Best of Times or the Worst of Times? 6 2. The Knowledge Economy 8 2.1 The Future of Work 9 2.2 Knowledge and the Knowledge Economy 10 2.3 The Knowledge City 11 3. Measuring Knowledge Cities 12 3.1 Australian Cities 13 3.2 The Basis of the Knowledge City Index 15 3.3 Computing the KCI 17 4. The Australian Cities 19 4.1 Analysis by Proportion 20 4.2 Analysis by Size 22 4.3 The Knowledge City Index 24 4.4 Knowledge Input and Output 21 5. City Portraits 22 6. A Knowledge Future for Australia 53 6.1 Building up Knowledge Capability in Australian Cities 54 6.2 An Outlook for Urban Policy and Planning 55 References 56 LIST OF TABLES Table 1. Population, Employment and Land Areas of 25 Australian Cities 14 Table 2. Indicators and Measures of the KCI 16 LIST OF FIGURES Figure 1. 25 Significant Urban Areas in Australia 13 Figure 2. The KCI Model 15 Figure 3. The KCI for Australian Cities by Proportion 20 Figure 4. The KCI for Australian Cities by Size 22 Figure 5. The KCI for Australian Cities 24 Figure 6. Knowledge Capacity vs. Knowledge Industries in Australian Cities 26 5 1. IS IT THE BEST OF TIMES OR THE WORST OF TIMES? The nature of work is changing. For some workers, it is the best of How will the changing nature of work and the transformation enabled times, as their knowledge, skills and creativity become increasingly by new technologies and the knowledge economy play out in valuable and combine to make them more prosperous. For others, Australia? We know which types of jobs are most likely to decline and however, it is the worst of times, as their hard-won skills and we have some sense of what types of jobs, or at least which sectors, are occupational practice become increasingly irrelevant or obsolete. likely to be most resilient. But this dichotomy of decline and resilience In many sectors of our economy, automation, artificial intelligence is not equally distributed across the geography of Australian cities. (AI), big data, and machine learning will make more and more jobs Some Australian cities are well positioned to grow and advance in redundant, or at least change them fundamentally (Frey & Osborne, the emerging technology-driven and knowledge-based economy, but 2013). Moreover, it is not just unskilled or semi-skilled workers who others lack the infrastructure and capacity to resist and survive the face these threats from new technologies and the changing nature of impacts of technological redundancy. Just like for individual workers, work. Increasingly, many skilled and professional occupations are being for some Australian cities it promises to be ‘the best of times’, but for affected by these same technologies and their associated economic many others it would appear to be ‘the worst of times’. and social transformations, leading some to question the very future of many professions (Susskind & Susskind, 2015). It is predicted that To better understand these impacts on our cities and inform our roughly half of the jobs that currently exist in developed economies policy and planning responses, this report builds a knowledge cities could be automated or otherwise made redundant by 2030 (Frey & index (KCI) for Australian cities. We examine a total of 25 cities in the Osborne, 2015). country and analyse each of them according to its knowledge capital (the underlying knowledge infrastructure of a city) and knowledge But the future of work is not necessarily bleak. As some occupations economy (the knowledge activation within a city). We combine six are replaced by technologies, others are likely to emerge in the new different measures through a data standardisation process, in order economies that open up. However, the new occupations will require to give a comparative overview of all 25 cities. In doing so, we employ different sets of skills from the past, and will be focused around new an innovative approach to Australian cities that provides a unique forms of industry and production. In short, those occupations that will understanding of how the changing nature of work is impacting different advance in the near future will be in the information and knowledge urban areas in different ways. This framework is both extendable to areas. They require human creativity and interpretation rather than comparative analysis of cities in other countries and repeatable over the repeated application of rules, and require the more nuanced time in order to understand how cities are changing over time. interpersonal skills that technologies are still not capable, and seem unlikely ever, of replicating. 6 The KCI results provide the most comprehensive understanding of For the top five cities, the current shift to a knowledge economy the knowledge strengths and weaknesses of Australian cities, and promises to be ‘the best of times’. For the other 20 cities, however, it insights into which cities are most likely to be resilient in the transition could well be ‘the worst of times’ as the knowledge economy becomes to a knowledge economy. Among them, three key findings are worth the dominant focus for local prosperity. Understanding the underlying our attention: components of these changes and exploring the social, political and economic implications that stem from them requires a nuanced • In our tale of 25 cities, five cities in Australia appear to be well approach. This report provides an analysis which both quantifies the prepared for the technological revolution and knowledge knowledge economies of the various cities and compares them. In so transition that are already taking place and can be qualified as doing, it provides the basis of such an approach ‘a knowledge city’ (Sydney, Melbourne, Canberra, Brisbane and Perth). The remaining 20 cities have knowledge limitations to This report is structured as follows. Following this introductory chapter, various degrees. chapter 2 conceptualises knowledge, knowledge economy and knowledge cities that underpin the theoretical and methodological • Canberra stands out as one of Australia’s leading knowledge approaches of this report. Chapter 3 outlines the 25 Australian cities, despite its comparatively small population and cities studied in this report, and the framework and methodology employment bases. It has higher proportions of its population for measuring their knowledge capability by constructing the KCI. with both knowledge capacity and who are actually working in Chapter 4 presents the KCI results in different versions to illustrate the knowledge economy than any other city. the different aspects of a city’s knowledge performance. Chapter 5 provides each of the 25 cities’ knowledge portraits to illustrate its • Cities that have traditionally relied on the manufacturing and strength and weakness as measured by the indicators of the KCI. mining industries for employment base lack sufficient knowledge Chapter 6 concludes the report by linking the KCI findings with capital and have not developed the knowledge economy to existing policy initiatives to point out a policy and planning outlook respond successfully to the impact of new technologies on their for future Australian knowledge cities. economies. 7 2. THE KNOWLEDGE ECONOMY The downturn in the mining boom which, until recently, has driven Australia’s economic growth and stability, and the expectation that such a boom is unlikely to return, emphasises the need for a transition to a more knowledge- based economy. In fact, knowledge is already an important part of Australia’s economy. In 2016, Australia’s third biggest export sector was not a physical commodity, but was education in the form of international students who came to study in an educational institution within the country.

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