BuildZoom, which is a tool to help people find local contractors, recently looked at construction costs across the US.
Here is their 30-city average index running from 1950 to roughly today:
Here is a chart showing the most and least expensive cities (that is, the cities that deviate the most from their 30-city average):
And here is a chart that compares labor cost appreciation to material costs:
Labor costs account for the bulk of the geographic variation in construction costs and the most expensive cities to build in also tend to have the highest median home prices.
The way to read the above chart is that any city with a y-axis value greater than 1 means that labor costs have appreciated faster than material costs from 2008 to 2017.
In the case of San Francisco, labor costs have appreciated 32.8% (> 1.3) faster than material costs.
Part of this likely has to do with the fact that San Francisco is an expensive city in which to live. People have to be paid more if they’re going to work there.
Full blog post from BuildZoom, here.
Fred Wilson wrote a great post on his blog today about New York City’s “transit mess.”
In it he talks about congestion pricing (which, as you all know, I support); the mess that is the Metropolitan Transportation Authority (MTA); and this 37-page report on how to improve the MTA.
Here is an excerpt from his post that I liked, but that won’t be popular with everyone:
That is an idea [congestion pricing] that has been proposed a number of times over the years, most notably by Mayor Bloomberg during his tenure. It is a good idea and long overdue. A dense urban environment should have excellent mass transit and incentives to use it and should have disincentives to drive cars. Taxing cars in Manhattan and using the revenues to maintain and improve our subways seems like an obvious thing to do.
I would encourage you to give his post a read. The New York Times also reported on this topic (and the above recommendations) this week. They called it, 7 ways to fix the MTA (which needs a $60 billion overhaul).
In Edward Glaeser’s book, Triumph of the City, he argues that the average temperature in January is the single best variable to predict which U.S. cities have grown the most over the last century. Indeed, from July 2015 to July 2016, 10 of the 15 fastest growing large metro areas in the U.S. were in the south. Follow the sun and sprawl.
Given this phenomenon, I thought it would be interesting to look at the world’s most influential cities (i.e. global cities) through this lens. Because let’s face it, New York and London aren’t all that warm in January.
Below are the top 25 global cities (taken from A.T. Kearney’s 2018 Global Cities Report), along with their average January temperature (taken from here). Note, there are two rankings. On the left is their global cities index. And on the right is their global cities outlook, which evaluates current potential. Cities that improved their economics & governance made the biggest leap on the right.
First of all, it’s interesting to see San Francisco jump so significantly in their outlook ranking. This has everything to do with tech and innovation. It’s also important to note that a handful of the above cities are located in the southern hemisphere, so “average January temperature” doesn’t mean the same thing (probably should have normalized to their winter).
Montreal wins the award for the coldest city in this ranking. And there’s really only one city, Singapore, with a tropical climate. Though there are others, such as Hong Kong and Sydney, that would fall under subtropical. All of this isn’t enough for us to start inferring anything, but perhaps colder and more temperate climates aren’t such a bad thing for economic growth.