The Urban Task Force says that cities are back - and they are. But Lord Rogers and his task force have missed the big story. Urban renaissance is not all about design, important though that is. The economy is driving the resurgence of British cities. And that means the recovery may be more fragile than it looks.

Over the past decade, there has been a general revival among Britain's cities. This is largely because of the UK's solid macroeconomic performance.

The amount of job creation is up in cities, and people are returning to them too.

In England, for example, cities' share of national employment growth rose during the 1990s: by 2003, two-thirds of all jobs were in cities. In the same year, cities' share of population growth rose to 42 per cent, up from just seven per cent in the 1980s. London and the big conurbations are now the country's economic hotspots.

Increased economic output, employment and investment are the main drivers of urban renaissance. Public policy has made a difference too: planning rules have helped to channel private sector money into cities, regeneration funding has pump-primed our city centres and, in some places, strong city leadership has got the job done.

Better design has also helped. Many cities now look and feel better.

Refurbished buildings, in places such as Liverpool's Ropewalks, and iconic new structures, for example Manchester's Urbis Museum or the Bullring in Birmingham, send a clear message to the outside world. Our forthcoming research on city centre living shows how improving these areas is one way to attract visitors and investment to cities, as well as to encourage people to live in central zones.

But these catalyst effects are relatively small, even in big cities.

Ultimately, the growth of city centre living reflects the fundamentals: without jobs, people won't stick around and flats will empty out. So city centre living is a marker of economic progress.

The taskforce is right: the job is far from done. But better design will not help us meet the real challenges our cities still face. There's a growing gap between successful and struggling urban areas.

Smaller cities and towns, mainly in the North of England, still need to figure out new roles - and define their relationships with the big urban cores. Low skill levels and a lack of jobs are still holding many places back. We need to extend the recovery beyond city centres into run-down inner ring neighbourhoods. We need to get better at attracting enterprise to deprived areas, as well as nurturing existing businesses. And we need smarter investment in transport to connect up our cities and towns.

To make this happen, cities need greater powers and incentives to enable them to deliver their own growth and to design policies that work best for them. Key functions such as transport, skills and economic development should be devolved down to the city-regional level, starting with our biggest city regions. Local authorities need incentives to work more closely together within city regions. Outside the big conurbations, smaller cities and towns also need to be handed stronger powers.

The economy remains the big one. Our cities are still riding the wave of national growth. But macroeconomic growth has slowed recently, and there may be choppier waters ahead. Would our shiny new cities be able to withstand the challenges of an economic downturn? That's the big question and the real test for our urban renaissance.