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Adelaide: drifting into a genteel poverty? « Previous | |Next »
January 9, 2010

Our economy is in the midst of a fundamental long-term transformation—similar to that of the late 19th century, when people streamed off farms and into new and rising industrial cities. That industrial epoch of capitalism had its own distinct geography, a post 1945 spatial fix of suburbanization based on mass production, cars and consumer credit.

Today, the economy is shifting away from manufacturing and toward idea-driven creative industries--what some call the knowledge economy. The decline in manufacturing is the result of long-term trends—increasing foreign competition and the relentless replacement of people with machines. This transformation will also have its spatial fix.

Adelaide is one of the older, manufacturing regions whose heydays are long past, and it has continued to struggle long after the mega-regional hubs and creative cities have put the crisis of the early 1990s behind them. As a rust belt city it stands for a region in decline as the manufacturing industry has shrunk, whilst the local high-end services—finance, law, consulting—that it once supported have also diminished. This region is no field of dreams.

The policy question is: How does a city such as Adelaide prevent its stagnation and decline? Will it make the transition from a resentful, post-manufacturing tawdry inward- looking city to a cosmopolitan friendly, hip city open to the global economy? Or will the city and its regions continue to decline and become a relic of the industrial age? Can Adelaide reinvent itself?

Richard Florida in his The Rise of the Creative Class. argues that innovation., economic growth, and prosperity occur in those places that attract a critical mass of top creative talent. The key drivers of such a transition are the "three T's" of technology, talent, and tolerance. If cities could make themselves appealing to the Web designers, architects, biomedical researchers, and other innovators who are now the drivers of economic growth, then they would also attract the businesses that want these footloose pioneers to work for them.

Florida's urban renewal theory is that the creative class fosters an open, dynamic, personal and professional environment. This environment of bohemian lifestyles and creativity in turn, attracts more creative people, as well as businesses and capital. It is a “creative capital” view of human capital generating growth.

I've thought that the “creative capital” view of human capital generating growth is on the right track. First, about the importance of knowledge-creation and creativity becoming a more important part of the economy Secondly, as cities turn on creative people, they need to attract creative people. Thirdly, bohemian types like funky, socially free areas with cool downtowns and lots of density, as in Melbourne. This is funky, creative chic, innercity area is what Adelaide lacks, even if it has the odd bohemian coffee shops with free wireless. So we have the idea of the new economy that stands in contrast to the old economy with its older-style industries and more traditional values-----a smoke-stack economic development.

The problem for Adelaide is that the well-established tendency for most types of economic activity to cluster in relatively few places rather than dispersing widely--Michael Porter's theory of industry clusters. A second problem is is another well-established characteristic of economic activity: in addition to being clustered geographically, the various activities are also tiered functionally. It is tiered functionally because ventures of one sort systematically demand services of other particular sorts. Consequently, people are crowding into a discrete number of mega-regions, systems of multiple cities and their surrounding suburban rings. The ability of different cities and regions to attract highly educated people—or human capital-- varies immensely.

Adelaide's prospects as a creative magnet are too daunting, and it has limited possibilities to become a magnet for talent clustering to be come a postindustrial phoenix. It really needs economic development and the city has to grow skills and talent from within. So Adelaide needs to present itself as being in the top category—of something---in order to grow its skills and talent and prevent people from leaving, getting by on tourism and retirees subsisting on the pension.

What is this top something for Adelaide in a global economy? Rann Labor has little time for the creative industries. Their drivers are uranium mining and defence industries based around building submarines, and these are seen as the key drivers of technological innovation, economic growth, and improved living standards. This version of high tech and laptop professionals is a long way from Florida's idea of cities with its thriving arts, cultural climates and openness to diversity of all sorts and also enjoying higher rates of innovation and high-wage economic growth.

Will these drivers result in a new economy based on generating ideas, with a higher density of of talented and creative people? A creative, postindustrial economy? I cannot see uranium mining and submarines coupled with low-density urban sprawl creating new software and alternative energy industries. I cannot see that encouraging and shaping economic growth through mining and defence will position Adelaide so that it is becomes best positioned to compete in the coming decades. These are not enough to attract young professionals and creative types or to ensure the emergence of high-growth services and industries.

| Posted by Gary Sauer-Thompson at 5:05 PM | | Comments (12)


Florida now argues How the Crash Will Reshape Americas in The Atlantic magazine that most big economic shocks ultimately leave the economic landscape transformed. Some of these transformations occur faster and more violently than others. The period after the Great Depression saw the slow but inexorable rise of the suburbs. The economic malaise of the 1970s, on the other hand, found its embodiment in the vertiginous fall of older industrial cities of the Rust Belt, followed by an explosion of growth in the Sun Belt.

America is going through a similar economic shock from 2008, that is destroying jobs, bankrupting businesses, and displacing homeowners. It has damaged some places much more severely than others:

No place in the United States is likely to escape a long and deep recession. Nonetheless, as the crisis continues to spread outward from New York, through industrial centers like Detroit, and into the Sun Belt, it will undoubtedly settle much more heavily on some places than on others. Some cities and regions will eventually spring back stronger than before. Others may never come back at all. As the crisis deepens, it will permanently and profoundly alter the country’s economic landscape. I believe it marks the end of a chapter in American economic history, and indeed, the end of a whole way of life.

He argues that place still matters in the modern economy—and the competitive advantage of the world’s most successful city-regions seems to be growing, not shrinking. Population and economic activity are both spiky, but it's innovation—the
engine of economic growth—that is most concentrated.

Adelaide was deeply affected by the "economic malaise" of the 1980s --it was one of the losers compared to Brisbane, which was one of the winners. Adelaide was not linked in a global technology system and a global labor market that allow people to migrate freely among the world's leading cities.

The innovative, talent-attracting "have" city regions---- city-regions—London, New York, Paris,Tokyo, Hong Kong, Singapore, Chicago, Los Angeles, and San Francisco that are strongly connected to one another----became increasingly remote from the talent exporting "have-not" regions such as Adelaide.

Spiky globalization wreaks havoc on poorer places creating destabilizing political tensions

As Florida says in The Atlantic article

Suburbanization—and the sprawling growth it propelled—made sense for a time. The cities of the early and mid-20th century were dirty, sooty, smelly, and crowded, and commuting from the first, close-in suburbs was fast and easy.

Cities have been cleaned up and are more attractive. People are returning.

Surely Adelaide's origin's as a non-convict city must be a factor.

In the de-regulated post 70's era where anything goes, Adelaide's lack of a entrepreneurial (or more accurately, opportunistic) spirit, has meant it has fallen behind.

Florida says in his Atlantic article that:

we need to begin making smarter use of both our urban spaces and the suburban rings that surround them—packing in more people, more affordably, while at the same time improving their quality of life. That means liberal zoning and building codes within cities to allow more residential development, more mixed-use development in suburbs and cities alike, the in-filling of suburban cores near rail links, new investment in rail, and congestion pricing for travel on our roads. Not everyone wants to live in city centers, and the suburbs are not about to disappear. But we can do a much better job of connecting suburbs to cities and to each other, and allowing regions to grow bigger and denser without losing their velocity.

Savvas Tziwnhs
Can Adelaide overcome the lack of a entrepreneurial (or more accurately, opportunistic) spirit) and make the shift to generating ideas and innovation so that there is a higher density of of talented and creative people?

At the moment the talented and creative people leave Adelaide for Melbourne or Sydney or Brisbane.

Sorry, maybe I have Savvas wrong.
I thought all this "opportunism" was what turned a "genteel decline" into a post State Bank farce that led to precisely the sort of legislating that has acountability of government at an all time low, the money wasted on macmansions, real estate shonks and new footy ovals every year, rather than being used to further develop the educational precinct, for example.

There's an interesting article on Der Spiegel (english version) online about Hamburg and their embrace of Florida and his ideas.
It spelt out gentrification for them. With a vibrant and active squatting population that defies categorisation (squatters in business suits), the Hamburg government has had to revise some of its "creative class" policies.

When I think about it, why wouldn't Adelaide be a happening place?
• Its between Melbourne and Perth, which beats, say Mt Isa
• Its a time zone closer to Singapore and India
• it has the best fringe festival and artistic conferences around
• it reminds me of Montreal, in the way of a small population ignored by most people.

I had no idea about Rann, but if this is true, then SA is not going very far. Rather unfortunate

the ideas about creative industries and the creative economy are being taken increasingly seriously by policy makers vis-a-vis the knowledge economy. Though I've mentioned the local---South Australia----the discourse about the creative economy has gone global.

In SA the cultural policy has been unreflective, suffering from a lack of robust debate, dispassionate analysis and there is minimal civil society involvement in public debate. The Rann Government's cultural (and social) policy is marked by intellectual dependency--it is dependent on New Labour thinking in the UK--ie., London, where the policy infrastructure and expertise resides.

They've imported New Labour policy and terminology, pretty much without altering a comma or full stop; whilst ignoring Australian initiatives such as Renew Newcastle.

I'm not sure that SA has a "Creative South Australia" policy---if there is one I have never heard of it. I think that their tacit animating blueprint reiterates London’s conception of creative industries, 1998 style – not even the reframed creative economy thinking of 2008--and so retains all its neo-liberal assumptions.

Hi Gary

I have found that in Europe, the difference between creative people and maybe, people on the Dole, to me, is a difference in outlook.

The organic organisation of some parts of the city by creative people, say squatters in Kreuzberg in Berlin, and those who are capital-c Creative (graphic artists, film directors) is not really what they do, but how and in what cultural space they do it in.

The squatters seem to do what they do (make films, do graphics, comics etc) in decrepid conditions, surrounded by a political environment, linked internationally. It does what it does, and purports to stay away from rules and regulations.

The new types of Creatives may not look that out of place from a city worker. The buildings, although interesting and sometimes amazing, aren't 'owned' in a cultural sense by those in the squats, nor are there deep personal networks, but more professional networks which could slip into friendships. It seems to be more individualistic, than collaborative.

That's not to say that the squatters have it more together, or are better. It's just been my observations over the past 15 years or so.

So, when you say Creative people - well, some would argue, it's happening anyway. You don't need to import in creativity. It's just accepting that that creativity happens in different cultures that aren't aligned with the planners or government visionaries.

To many, Creative Classes = gentrification.

What would also help me (maybe by reading Florida's book) would be to know what they call 'Creative'. Advertising agencies? Architecture? Investment Bankers? Because, if it does include those, I would definitely say the G-word.

Which, I feel is also an organic process. Just different cultures carving out their place in a city. And probably, the Creatives getting more space because they are likely more actively working within the system, hence they get what they want. Squatters, comic artists, DJs, multimedia guys, zineheads and goths bracelet market stall holders aren't that good at working out the system.

Creative types for Florida is associated with the knowledge/information economy. So think more Silicon Valley than Madison Avenue.

However, it is fairly broad category since it covers Wwb designers, architects, biomedical researchers, and other innovators who are now the drivers of economic growth in a knowledge economy.