Modern Life

Why remote workers are moving to small towns and cities

No longer tied to offices and long commutes, white-collar workers are taking advantage of new freedoms, and shifting preferences of where and how they want to work will have long-reaching effects.

By John Surico — February 23, 2021

For most of the last century, offices were in or near cities, as were the services needed to fill them, such as transportation, housing, and food. The suburbs were defined by their proximity to cities, and homes were places to return to at day’s end. So what if, for wide swaths of the working populace, that no longer applies?

A Gallup poll released in October revealed that 33% of job holders in the United States were always remote and an additional 25% were occasionally remote. Major tech companies like Twitter, Facebook, and Slack have told their employees that working from home is now at least semipermanent, and other institutions such as universities and hospitals expect virtual instruction and care to be standard offerings. A PwC survey found that more than half of all office workers —55%— would like to work remotely three days a week or more, and fewer than one in five employers want to return to the office as it was before.

This disruption has resulted in a remote-worker migration where up to 23 million people could move in the US alone and a labor shift that is setting off ripple effects across industry, real estate, and government. In industry surveys, workers in fields like tech and finance say they’ll ditch expensive cities such as San Francisco and Seattle. Meanwhile, 15% of 3,300 tech workers sampled who were living in the Bay Area have left. And those who move are more than twice as likely to settle in less dense regions with lower housing costs.

Biking man on a bridge overlooking water in Burlington, Vermont.

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In Burlington, Vermont, nearly a third of the population is in their 20s. It's well-known for outdoor activities including biking and trails.

Cities like Burlington, Vermont; Bend, Oregon; and Butte, Montana, have become Zoom Towns, with swarms of new arrivals in recent months. They’re also popping up around the world in places like Somerset, England, and Western Australia. Even India’s Silicon Valley in Bengaluru (also called Bangalore) is emptying out. If an area has reliable Wi-Fi, a connection to nature, and good transporation links to larger hubs, remote workers are flocking there.

Remote-worker migration goes big

Remote work has been on the rise for good reason. Before COVID-19, the cost of living in the most expensive US cities was around 40% to 80% percent higher than the national average, a trend mirrored in global capitals like London, Paris, and Tokyo. Smaller municipalities such as Tulsa, Oklahoma, were already luring big-city residents with more space, cheaper prices, and offers of grants and coworking space. The trend isn’t new, but “this past year it has been on steroids,” says Prithwiraj “Raj” Choudhury, a professor at Harvard Business School who focuses on the future of work and wrote about the trend recently for the Harvard Business Review

In 2020, large numbers of workers, restricted from going to the office, began to take a hard look at their home, work, and outdoor spaces. Just 36% of homes in US cities like New York and San Francisco have a spare bedroom for an office. Choudhury, who advised Tulsa and is now helping the local governments of Venice and Cape Town attract remote workers, says, “This has really become a national and international phenomenon.” The acceleration of trends by the pandemic has shifted remote-worker migration into hyperdrive. 

So what does this mean for the towns people are moving to? 

Danya Lee Rumore, a professor at the University of Utah, says “gateway communities” in the Mountain West — smaller towns that are located close to a national park or ski resort and have populations of fewer than 25,000, like Moab, Utah, or Jackson, Wyoming — were already seeing increased visitation and growth. Now this movement of people to places for recreational reasons — called “amenity migration” — has taken off.  

Traveling woman sitting on Longreach bay on Rottnest Island near Perth, Australia.

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Perth, Australia, which is the capital of Western Australia, is one of the most isolated cities in the world.

In recent meetings with corporate leaders, Rumore learned that they expect between 50% and 80% of employees to stay remote, many of whom hold six-figure salaries. “What does it do to a community when the average income of a local employee is $40,000,” she asks, “and, all of a sudden, you have a mass in-migration of people who have average incomes of $150,000?”

What happens? A sort of small-town gentrification — and, inevitably, a rise in prices. In Flathead County, Montana, for example, monthly real estate closings nearly doubled in 2020, and the median home-sale price jumped almost $50,000 in five months.

Rumore, who launched the Gateway and Natural Amenity Region Initiative, says some communities have tools to ensure equitable growth, like zoning and ordinances, but she is worried about towns that aren’t prepared for such an influx of new residents and the strain it will create. “Rural development experts said this year we’ll be where they expected us to be in 15 years,” according to Rumore. “Once [the towns] get discovered, they start to have big-city problems” — like congestion, unaffordability, and infrastructure constraints. 

“Are they going to start pulling people back into the office? I think there’s been enough change fundamentally that we’ll remain in a hybrid mode.”

—Andy Rhodes, HP’s Global Head of Commercial PCs

If Zoom Towns want to retain these new residents and keep local ones, they need adequate infrastructure (increased tax revenue can help with that) such as reliable broadband and power, and farsighted city planning. Bhagyashree Pancholy’s remote work consultancy All Remotely helps companies migrate their workforce online. When COVID-19 hit, she was researching how rural communities across her home state of Rajasthan, India — already a favorite destination for expats — could add remote workers. “The access to stable, fast Internet connection was a real problem [for all workers],” Pancholy says. “But I also had this problem in the middle of Iowa.”

Stefan Palios, a journalist and consultant who specializes in remote work, is moving himself — from Toronto to Windsor, Nova Scotia. He advises town planners to take stock of the amenities they offer, such as affordable housing or great natural vistas, then be proactive, and not to take a perceived urban exodus for granted. “What can you offer that nobody else can?” he asks.

More choice, lower costs

No matter where remote workers end up, the work-from-home structure has been normalized.

“In two years’ time, after this big experiment of working from home, are they going to start pulling people back into the office?” asks Andy Rhodes, HP’s Global Head of Commercial PCs. “I think there’s been enough change fundamentally that we’ll remain in a hybrid mode.”

This return of sorts to an uncentralized workplace has merits and challenges. “The biggest positive is that you can choose where you live,” says Choudhury. And if employees are remote half the time, they can pocket up to $4,000 a year, thanks to less money spent on commuting, parking, and that $13 downtown lunch. They also have more time to spend with loved ones, exercising, or socializing. 

Employers win, too: Businesses can minimize their physical (and carbon) footprint, but maximize their recruiting reach and hire talent from anywhere. Companies can also save up to $11,000 a year for each employee who works remote at least half the time. Companies can reduce budgets on business travel and airfare, hotels, and events, and — if location is no longer consequential — smaller, less expensive office space.

Remote work also has the potential to prevent brain drain. “Scholars like me have studied the phenomenon of smaller towns losing talent to cities, or emerging markets losing talent to the West,” says Choudhury. “Now that talent can come back.”

View of the small village of Porlock in Somerset, England, with its traditional houses and buildings.

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View of the small village of Porlock in Somerset, England, with its traditional houses and buildings.

But the wherever office isn’t without pitfalls — ask any worker juggling children, homeschooling, pets, and shaky Wi-Fi. Traveling from room to room to avoid noisy kids, leaf-blowing neighbors, competing video calls, or sunlight has become the new business travel. This new micro-mobility means workers require the right tools for success. “How does technology enable everyone to give their best self when they are working remotely?” asks Rhodes.

According to Rhodes, it takes up to 23 minutes for workers to regain focus after a disruption while remote, and caregiving or other responsibilities could create “second-class” employees who are at a disadvantage due to their living situation. Companies will have to rethink their relationship with employees, one less centered around a physical place and more aligned with the new work-life pattern. Experts say that some of the daily disruptions synonymous with this past year will subside as in-person activities resume. Yet the struggle of isolation will persist.

“How do we drive a more engaged workforce?” asks Loretta Li-Sevilla, who heads Future of Work and Collaboration at HP. “In the office, it’s taken for granted that you’re always connected, but when you’re home, that becomes a challenge.”

Experts like Choudhury and Li-Sevilla suggest more informal video huddles, virtual water coolers, and flex days, which would allow remote workers to socialize or meet management in a more comfortable setting. Companies should consider opening up localized “hubs” in new growth areas, which would serve a more social, rather than utilitarian, function. 

For companies, the key is creating new rules of engagement that ensure work — whether it’s individual or collaborative, in-person or virtual — is inclusive to everyone, no matter where they are. 

“Now, as we see this whole distributed work environment, it’s really tied to what’s most important for people and an individual’s needs, versus the employer and their needs,” says Li-Sevilla. 

“There’s a shift going on,” she continued. “More power is in the hands of the people.”


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