As automation continues to dislocate the workforce, Australian cities must adapt to attract highly-skilled workers from around the world.

And that means building cities that are both liveable and sustainable.

Our cities are in fierce competition for tourist dollars, talent, ideas and investors. In a global marketplace where talent and capital are footloose and fancy free, how a city feels can be its competitive edge.

Employment is no longer tied to a sense of place, whether that’s the factory floor or an inner-city office. The best and brightest young people have grown up in a ‘flat world’ where information and ideas can be shared in an instant and a trip to the other side of the world takes a day. They’ve seen first-hand what it’s like to live in cities with brilliant cycling cultures, like Amsterdam and Copenhagen. They’ve marvelled at the miracle of modern public transport – hello Hong Kong and London! They’ve traversed the walkable streets of Paris and New York.

These are the places that attract the ‘knowledge worker’ of today.

The term ‘knowledge worker’ was coined by management guru Peter Drucker way back in 1957, when he wrote that “the most valuable asset of a 21st-century institution, whether business or non-business, will be its knowledge workers and their productivity.”

The NSW Government’s recent Jobs for the Future report finds that nearly half of all jobs in Australia are already reserved for knowledge workers, and this figure will grow to 61 per cent by 2036. These knowledge workers will be looking for cities that are healthy, liveable and sustainable. And they want places where they can afford to live and can move around easily.

The Centre for Economic Development of Australia’s report, Australia’s Future Workforce, argues that “workers who produce ideas capable of being sold on the global market live where the living is good.”

A liveable city attracts innovators – the designers and dreamers, creators and collaborators – who then drive change to make a city even more liveable.

A Savills UK study, What Workers Want, found that knowledge workers are attracted to cities where they can balance a high-quality lifestyle with financial rewards. A city where work, rest and play are accessible within a 30-minute radius.

In The New Geography of Jobs, economist Enrico Moretti argues that a city’s public transport and economic success are intertwined. Knowledge workers in high-value, innovative industries – who prefer to use their iPods on the train than sit behind the wheel for two hours each day – are drawn to cities with good public transport networks.

The implications are obvious for Australian cities, with their hundreds of thousands of workers log jammed in traffic each day.

JLL’s New World Cities report finds that size, power and wealth are no longer guarantees of success. In fact, JLL identifies a new breed of small or medium-sized cities that have attractive infrastructure and a high quality of lifestyle, as well as specialisation in a small number of global markets. Think Vancouver, Portland and Melbourne, Brisbane and Barcelona as examples of knowledge, cultural, high-tech or innovation hubs.

Meanwhile, another Savills report, Tech Cities 2017, recently ranked Melbourne as Australia’s top ‘tech city’ – but it came in 14th globally for its infrastructure, business environment, talent pool and lifestyle demanded of high technology companies.

San Francisco and New York may be top picks for technology companies, but other liveable cities like Amsterdam, Copenhagen and Toronto are also rising up the ranks. Melbourne’s appeal rests on its liveability and healthy lifestyle, which could make it a strong base for tech companies, the report found.

Savills assessed each city’s ‘buzz’ – its nightlife, entertainment and culture – alongside ‘wellness’ metrics like pollution levels, access to parks and green space, healthcare and, the clincher, commuting times. It also considered the cost of living in each location.

The report found young talent is looking to live in dynamic, vibrant and healthy urban communities a stone’s throw from the city. Given the laser focus on well-being among young workers, this could come to dominate decision-making in the future.

What does this mean for Australia’s city builders?

It means investment in sustainable city infrastructure – such as active public transport, pocket parks and walkable neighbourhoods – is not only good for the environment. Sure, sustainable cities have cleaner air, less traffic congestion and fewer greenhouse gas emissions – but they also provide foundation for a city to attract mobile knowledge workers. And that is an essential ingredient in the 21st century economy.