Your next Milano: the event by Assolombarda and Milano & Partners

The recovery of economic activity and employment to pre-pandemic levels will only be complete in 2023. The forecast is +122,000 people in employment in the 2020-2025 period

In 2020, Milan posted an unprecedented drop in GDP: nearly -11% in terms of value added, more than Italy and Lombardy. The economic shock was due not only to the early and relatively high spread of infections but also to the economic structure of the city, with a strong presence of services which have particularly suffered from the limitations imposed by the pandemic. Today the social and economic consequences of Covid accentuate the need to redesign the city’s development the coming years. This needs to be done by redefining the internal balance of Milan and its relation with surrounding territories; by investing in economic recovery and employment based on a renewed reading of the cit’s positioning in the network of the global economy, and by redesigning and strengthening Milan’s model of attractiveness for businesses, young talent, foreign investment and tourism. To kickstart recovery, Milan must start back from its fundamentals, investing in strategic assets such as work, mobility, attractiveness, inclusion.

This is what emerged out of "Your Next Milano", the event promoted by Assolombarda and Milano & Partners streamed live on the Assolombarda Genio & Impresa web-magazine to provide an opportunity for discussion and reflection on the future of the city. In fact, the pandemic was above all an urban phenomenon, bringing silence to the noise and bustle of cities, and halting decades of growth to induce a state of artificial stasis.

Covid has therefore put the role of cities and their models of development at the center of the discussion.

This is a veritable urban metamorphosis, as told in the introduction by sociologist Aldo Bonomi, and calls for additional investment in the connections between the city and its neighboring territories. Companies, in this sense, are a virtuous example: their interdependence is strength. Their ability to work together, to share skills and experiences, to be connected, represents an economic multiplier. It is a message that also applies to Milan, which must truly become an inclusive city, capable of growing around reciprocity and interconnection of territories. It is about fostering a profitable exchange and a positive-sum game between local companies and institutions: "Your Next Milano" was the final stage of a journey through local territories (Monza, Lodi, Pavia and Milan) aiming to restore the meaning and importance of a strongly interconnected area to compete globally. But the event was also a step in the repositioning process pursued by the business world in synergy with strategic territorial stakeholders. The event, introduced by Alessandro Spada, President of Assolombarda, was concluded by an interview with Antonio Calabrò, Vice President of Assolombarda, and Giuseppe Sala, Mayor of Milan, by Monica Maggioni, TV journalist.

The economic forecast for the coming years, prepared and presented by the Assolombarda Research Center and Oxford Economics, shows that 2021 will be a year of rebound (+ 5.3% in Milan), although recovery to pre-pandemic levels is estimated to occur in 2023, and by 2025 Milan’s economy will have grown by 6% compared to 2019. 

In the medium term, from now until 2025, growth in value added is estimated to be over €23 billion, with business services and trade being the main drivers in terms of economic growth. Also the manufacturing industry, thanks to an expected increase in productivity, will play an important role for the growth of Milan, making up for the decline in activity suffered in 2020. Furthermore, one of the strategic sectors for the city, ICT, is projected to post the highest growth, with an increase in value added of 11% compared to pre-pandemic levels. Finally, hospitality will make its contribution to the economy of Milan and its province, supported by the recovery of domestic and international tourism.

On the employment side, an increase of over 122,000 jobs is expected to occur between 2020 and 2025, with business services and retailing contributing most of this growth. Personal services, which currently account for 2/3 of employed women, and hospitality, with 1/4 of workers under 30, will also play an important role in the recovery, so to rebalance employment opportunities between genders and generations cohorts.

Milan is changing and will have to change its social infrastructure, spaces and times in line with the digital innovations that 2020 have accelerated and that the city will embrace from several points of view: from new ways of working to sustainable urban mobility, from hybrid skills to integrated services, in order to seek a new synthesis between innovation and tradition. Among the panelists: Fabio Benasso, President and CEO of Accenture Italy and Vice President of Assolombarda; Enrico Martines, Head for Development and Innovation, Hewlett Packard Enterprise; Lorenzo Maternini, Cofounder, Talent Garden; Laura Rocchitelli, President of tge Rold Group and President of Assolombarda Mechatronics Group; Sergio Zocchi, CEO October Italy.

Milan more than other territories has been able to absorb the backlash of the sudden closures imposed by the emergency and gradually accommodate the subsequent reopening. Once the pandemic is over, the use of remote work will be much more widespread than in the past, involving, according to corporate projections, 75% of industrial comapnies and business services in the city of Milan (it was 43% before emergency) and 54% in the Milan metro area (up from 20%).

In parallel, for the period between February 2020 and January 2021, data on mobility indicate a constantly higher level of movement and permanence in residential areas (+15% compared to the pre-Covid-19 situation), while mobility for either leisure or work reasons is n sharp decline (in both cases over -40%). Furthermore, the dramatic decrease in the number of subway passengers (-71% in the last eleven months) and pedestrian movements (-60%), is contrasted by a more contained reduction in the use of private vehicles (-40%), with an increase in traffic congestion.

Attractiveness and inclusion are the other two strategic assets on which "Your Next Milano" focused, in order to trace the possible evolution of Milan in the coming years: from real estate investment, which already positions Milan among the most dynamic marketplaces in Europe, to supply chain construction, from air transport to tourism, major events and trade fairs, devastated by the pandemic, to the issue of attracting talents. Panelists were: Mario Abbadessa, Senior Managing Director & Country Head Hines Italy; Giuseppe Bonomi, CEO of Milanosesto; Armando Brunini, CEO, SEA – Milan Airports; Michela Matteoli, Director, CNR Institute of Neuroscience and Coordinator, Humanitas Neuro Center; Gianluca Scavo, CEO of AIM Group International and President of the Assolombarda Tourism Group.

Milan is also called upon to adapt its model of attractiveness to the new context, finding new ways to be a magnet for capital and firms, young people and talents, visitors and tourists, around which it has built in large part its development. Looking at the numbers of tourism confirms dark expectations: in 2020 there were just 2.2 million arrivals to the Milan metropolitan area (-73% compared to 2019) and passengers arriving or departing from Milan airports were 13.3 million (compared with 49.2 million in 2019). And the forecast is not optimistic: according to estimates, domestic tourism to Milano will return to pre-pandemic levels by 2022, while international tourism will only do so in 2023-2024.

However, Milan confirms itself as a global academic hub: admissions of international students to Milanese universities grew during academic year 2020/2021 (+5.6%, equal to 5,400 students). The pandemic does not therefore stop the rapid internationalization of Milanese universities in recent years, which already had 14,600 international students last year, accounting for 6.7% of the total student population.

On the business side, Milan stands out again in 2020 as a catalyst for greenfield direct investment into Italy. In a global context marked by shrinking investment and in contrast to the rest of Italy, in 2020 Milan managed to attract 51 greenfield projects (lower than the record year of 2019 but still higher than in 2018). A result linked to the city's recognized vocation for the knowledge economy, which specializes in financial services, real estate activities and business services.

2020 was the year when inequalities grew markedly: distance teaching and remote learning discriminated disadvantaged students leading to early school leaving, while the the drastic reduction in sociability led to psychological distress and income loss.

Assolombarda will focus its action on the challenge of inclusive development, through strong investment into the design of "collective actions" of social responsibility, integrated with municipal policies and developed together with public institutions, non-profits and civil society, so to actively contribute to the revitalization and well-being of the territory, according to the so-called Ambrosian style of partnership between private and public stakeholders.

For more info visit: https://www.yesmilano.it/en/articles/your-next-milano-event-assolombarda-and-milano-partners