One of the most impacting challenges that smart cities will face is the disruption of the labor
market due to the progressing automation and the use of robotics to replace manual work.
New jobs must be created while obsolete ones disappears. And not only that, but people who
lost their jobs must be trained as fast as possible so they can be reallocated to new positions.
Cities that don't manage this quickly enough will be confronted with long-term
unemployment, that may consume money addressed for other challenges.
According to a research from University of Oxford, the main affected areas will be office and
administrative support, sales and service. With this knowledge, smart cities can take a step
further and start the jobs transition smoothly, so this causes lesser impacts on its social and
Attract and retain high-tech and creative talents is not an easy task too. And as they are the
foundations for new initiatives and start-ups, they are also the catalysts that help the cities to
create new jobs and businesses.
So, to be attractive to these talents, smart cities should provide a lifestyle that fits the needs of
young professionals and also have the presence of reputable institutions, researches, an
innovative financial sector, and stimulation of start-ups.
Another related problem that might emerge from automatization of manual work is the
income inequality, as companies are less dependent of human labor for these activities, there
is a higher risk that employees will earn much less money than owners of companies. In this
scenario, not only government, but also businesses and groups of citizens should work
together to solve social problems.
Out of the labor subject, there is data security and privacy. As smart cities tend to be highly
digitized, with large volumes of data stored digitally and a huge number of physical objects
connected to the internet, almost every aspect of our personal lives is captured in digital data
that is stored somewhere. Digital systems and connected objects which are part of vital
infrastructures can be hacked and data analytics may become so powerful it can combine data sets to infer someone's lifestyle, habits and more.
Finally, smart cities must be prepared to ensure continuity of critical services, like energy,
water, communication and transportation, in case of a deliberate attack, accidents and natural threats.
Though high digitization that smart cities rely upon may be compromised causing serious
disruption of society and economy, it may also provide the government with real-time
information and insights, helping to minimize the effects of incidents since traffic accidents to
Nobiletec is a multi-national consultancy firm specializes in B2B, B2C and P2P FinTech solutions.