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Smart Cities' Challenges

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

economic programs.

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

malicious attacks.


Nobiletec is a multi-national consultancy firm specializes in B2B, B2C and P2P FinTech solutions.

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