For roughly the last decade, as the nation's biggest metro areas have become increasingly unaffordable, some white-collar workers and freelancers who are able to work remotely have been ditching major hubs like Seattle and San Francisco for smaller metro areas like Las Vegas and Austin: Between 2007 and 2017, according to a recent Wall Street Journal analysis, the proportion of people who work from home in mid-size metro areas grew faster than the corresponding figure for both smaller and larger regions.
Kelly Swift, a health care consultant, gave up her paycheck-to-paycheck lifestyle in the Los Angeles area to work remotely from Boise, Idaho, where she and her husband, who have two kids, were able to buy a house. "We all love it," she told the Journal. "We have a much higher quality of life here."
Now, thanks to COVID-19, the movement away from the biggest metro areas will likely accelerate. Amid the pandemic, some tech giants, most notably Facebook and Twitter, have announced policies extending remote work for years or even indefinitely. Other companies may follow suit. The overall impact, says Mark Muro, a senior fellow and policy director at Brookings' Metropolitan Policy Program, is likely to be a positive – if relatively moderate – realignment in the geography of the nation's workforce.
"I don't think it will completely reverse the fortunes of … struggling heartland places," he says of the telework trend. "I think this is good, though, for the middle of the country, and it's good really for tech, which has been struggling with high-cost problems but also the sense that they are too far away from regular America."
American Big Tech – a global behemoth of an industry whose financial value and influence has only grown amid COVID-19 – was, of course, born on the West Coast decades ago, but the sector remains heavily concentrated in just a select few metro areas. According to a December Brookings report, coauthored by Muro, between 2005 and 2017, just five metro areas – Boston, San Francisco, San Jose, Seattle, and San Diego – accounted for 90% of the country's innovation-sector growth.
The data point underscored a far larger trend: For decades wealth and resources have been disproportionately concentrating in a select few coastal "superstar cities" while other places, particularly once prosperous industrial towns and cities in the Midwest and South, are left struggling. "The result," the report states, "is a crisis of regional imbalance."
But even the supposed beneficiaries are suffering from so much concentration: The San Francisco Bay Area, home to Google, Facebook and Twitter, is facing a notorious housing nightmare that prices out young people, limits the potential of other sectors and exacerbates social problems like homelessness and gentrification. Boston, another highly prosperous region, faces similar problems.
"For the most part," says Muro, "these overheated tech hubs didn't feel like winners. They felt like losers."
The coming rise in telework may help ease some pressure on superstar metros, Muro says, while also providing a lift to less expensive cities that emerge as destinations for newly mobile workers. Smaller metro areas that have already seen recent upswings, like Denver, Kansas City, and Indianapolis, are likely to be beneficiaries; so might college towns or even rural areas farther away from major cities.
"Remember, this is predicated on telework," says Muro. "So there may be some tech workers that actually do prefer to land in a quiet, bucolic Midwestern farm town with good broadband."
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Twitter has implemented the most sweeping change: On May 12, some two months after the company first introduced a remote work scheme, CEO Jack Dorsey told employees that they would have the option of staying away from the office indefinitely.
"We were uniquely positioned to respond quickly and allow folks to work from home given our emphasis on decentralization and supporting a distributed workforce capable of working from anywhere," a spokesperson told various news outlets at the time. "So if our employees are in a role and situation that enables them to work from home and they want to continue to do so forever, we will make that happen."
A week later, the mobile payments company Square, also helmed by Dorsey, announced a similar policy, and in a May 21 article, Facebook CEO Mark Zuckerberg said that he expected about half the company's 48,000 employees to be working from home over the next five to 10 years. "We're going to be the most forward-leaning company on remote work at our scale," Zuckerberg told the website the Verge.
Other tech titans have held back. Google, which is currently expanding its second headquarters in San Jose, now has a work from home policy in place through the end of the year, but CEO Sundar Pichai recently told Wired that he expects the company to still rely on physical interaction. Apple started bringing some employees back to its Cupertino, California, headquarters last month.
There's still potential for a far larger work from home revolution: About half of American workers have jobs that can be done remotely, at least in part, Kate Lister, president of Global Workplace Analytics, told the Chicago Tribune, and some companies in other sectors may be inclined to follow Twitter's early lead.
But even a small geographic shift among workers in the tech industry, in particular, says Muro, amounts to a real mutual benefit for cities. "This really is a win-win-win," he says, "because it's not going to be a catch-all – it's not like Twitter itself is going to move away. It's going to be maybe a couple hundred or a thousand workers who will be working remotely in Dallas or Wichita or college towns." What was not working, he says, was the pre-COVID-19 status quo.
