The Remote Work Effect: How Digital Nomads Change Communities
This post is part of an essay collection. You can buy the book version on Kindle or subscribe on Substack for new essays.
Silicon Valley is a mindset, not a location.”—Reid Hoffman, LinkedIn Founder
At the onset of the remote work era, people living in the world’s most expensive cities were the first to jump ship. A Pew Research Center study found that 1 in 20 Americans moved in response to Covid-19, often spurred by the prospect of more space, lower living costs, and convenient access to nature. The biggest exodus was from San Francisco: almost 40% more people moved out of the city in 2020 than the year before.90
By December, a fresh bid to become the next Silicon Valley had emerged—and like Silicon Roundabout before it, the idea started on Twitter. Delian Asparaouhov, principal investor at the venture capital firm Founders Fund, was one of the many Californians who’d become disillusioned with San Francisco during the pandemic’s first year. Among the growing discontent on social media, he tweeted:91
“ok guys hear me out, what if we move silicon valley to miami” 150 Retweets 211 Quote Tweets 4,287 Likes
Seeing the rising likes and RTs on Asparaouhov’s tweet, Miami’s Mayor, Francis Suarez, responded with a classic venture capitalist line:92
“How can I help?” 314 Retweets 214 Quote Tweets 5,728 Likes
The resulting hype became a meme in itself. Mayor Suarez printed t-shirts with his tweet etched in the iconic neon pink and blue shades of Miami Vice. A billboard appeared on the Bay Area stretch of US Highway 101, broadcasting one of Suarez’s subsequent tweets: “Thinking about moving to Miami? DM me.”93
Between July 2020 and July 2021, nearly a quarter of a million US residents decided to make Florida home;94 Miami saw the single biggest percentage increase—15%—in tech workers over that year than any other American city.95 But what politicians like Cameron and Suarez didn’t pause to consider are the negative consequences of Silicon Valley’s success, and whether similar hubs will follow the same path. The influx of innovators to California undoubtedly boosted the state’s economy and lined investors’ pockets, but it also forced San Francisco’s working poor to live in RV communities and for homeless camps to spring up on vacant plots of land.96 The city has become so expensive, even the tech talent that made it thrive can no longer afford to live within its limits.97 The Silicon Valley dream has, for many, become more of a nightmare.
In the past, innovation clusters represented the best opportunity for cities to attract knowledge workers, but with remote teams becoming more common, that old equation is breaking down. The incentives for individuals to live in overpriced urban centers have disappeared, making it much more difficult to reproduce the network effects that once propelled Silicon Valley’s innovation ecosystem. Mayor Suarez was playing the same hand as Cameron in East London—but remote work has changed the rules of the game.
While workspace and business travel were once dictated by the company a person worked for, remote work moves the decision-making power from organizations to individuals. As more people choose to work from anywhere, flexible, remote jobs are replacing what were once office-based roles.98 Remote work hasn’t just transformed companies, it’s changed mainstream attitudes towards location. Long-held assumptions about opportunity and place have shifted, and more people are weighing their options. Residents of old power capitals like London, Paris, and New York have already shown their willingness to move to more appealing destinations—to so-called “Zoom Towns” near national parks and other sites of natural beauty in the US,99 and “Nomad Villages” on European coastlines.100
Policymakers in lesser-known cities have even begun competing for remote workers by offering them cash grants. From $2,000 in Savannah, Georgia to $15,000 in St. Clair County, Michigan, some incentive programs throw in perks like coworking space memberships, access to local business communities, and help finding housing and schools in the area. Regional governments expect the programs to deliver significant economic impact.
Tulsa Remote, which launched before the Covid-19 pandemic, in 2018, pairs $10,000 grants with community business events for remote workers who relocate to Oklahoma’s second-largest city. In 2021, a review found that for every dollar Tulsa spent on its program, $13.77 was generated in local labor income.101 The same study showed that one new local job was created for every two household members brought to Tulsa. All told, the Tulsa Remote program is estimated to have contributed $62 million to the local economy in 2021.
Topeka, Kansas also anticipates a return on its investment. “What we found is that $10,000 in remote incentives translates into $50,000 in economic impact in just one year,” said Bob Ross, Senior Vice President of Marketing at the Greater Topeka Partnership, the area’s economic development agency. “Then you add in the soft benefits of the intellectual and cultural impact [those remote workers] will be making and it’s $10,000 very well spent.”102
The dissipation of knowledge workers isn’t unique to the US—a similar effect is reshaping Europe. Modest cash incentive programs for remote workers have launched in Malta103, Italy104 and Spain,105 while Greece and Portugal are offering a reduction of 50% on income tax for seven years.106 Mediterranean countries have suffered severe brain drain in the first part of the 21st century, while also hosting the world’s most rapidly aging populations. Policymakers recognize economic incentives and nomad visas in such places are now vital. Providing formal pathways for nomads to integrate could be their best hope for reversing decades of economic stagnation.
As governments seek to attract and retain talent, they’re beginning to act like startups. In the early days of the web, the software engineering skills needed to build internet businesses were hard to come by. Companies like Google, Facebook, and Amazon had to get good at sourcing and keeping hold of the right workers. As these brands expanded their operations, ambitions, and influence, they optimized their talent acquisition strategies—not only to attract the best people, but also to make access harder for their competitors. Venture capital business models encourage tech companies to monopolize user bases—to do that, they need to monopolize talent too. The scramble for jurisdictions to win remote workers marks a new chapter in this global battle for talent.
It’s unlikely Miami will be the next Silicon Valley. It’s even less likely to be in Topeka, Tulsa, or somewhere in the Mediterranean. Instead, opportunities are decentralizing away from innovation clusters and dispersing across geographies and time zones. As attitudes towards location shift , there’ll be no one, single destination for innovation. The future of innovation, like the future of work, is distributed and global. New remote work hubs are emerging, and they’re in a strong position to carve out cultural and economic niches for themselves.
Today, the question on policymakers’ minds isn’t what will attract wealthy investors or scrappy nerds. Now, they’re asking what nomads want instead.
Read the next post:
References
Biddulph, Matt. “‘Silicon Roundabout’: The Ever-Growing Community of Fun Startups in London’s Old Street Area.” Twitter, July 23, 2008. https://twitter.com/mattb/status/866136681.
Cameron, David. “East End Tech City Speech.” UK Government, November 4, 2010. https://www.gov.uk/government/speeches/east-end-tech-city-speech.
Engel, Jerome S. “Global Clusters of Innovation: Lessons from Silicon Valley.” California Management Review 57, no. 2 (February 2015): 36–65. https://doi.org/10.1525/cmr.2015.57.2.36.
Wainwright, Oliver. “‘Everything Is Gentrification Now’: But Richard Florida Isn’t Sorry.” The Guardian, October 26, 2017. https://www.theguardian.com/cities/2017/oct/26/gentrification-richard-florida-interview-creative-class-new-urban-crisis.
Graham, Paul. “How to Be Silicon Valley.” paulgraham.com, May 2016. http://www.paulgraham.com/siliconvalley.html.
McKinsey & Company. “East London: World-Class Centre for Digital Enterprise.” McKinsey Media, March 15, 2011. https://www.mckinsey.com/~/media/mckinsey%20offices/united%20kingdom/pdfs/east_london.ashx.
McGregor, Jay. “Is the Success of London’s ‘Silicon Roundabout’ Forcing New Start-Ups Out of the Capital?” The Independent, May 1, 2013. https://www.independent.co.uk/tech/is-the-success-of-london-s-silicon-roundabout-forcing-new-startups-out-of-the-capital-8599699.html.
Volpicelli, Gian M. “How London’s Silicon Roundabout Dream Turned into a Nightmare.” Wired, July 27, 2020. https://www.wired.co.uk/article/silicon-roundabout-tech-city-property.
Rushton, Katherine. “Slowdown Hits Cameron’s Tech City.” Daily Mail, January 16, 2017. http://www.dailymail.co.uk/~/article-4123112/index.html.
Khomami, Nadia; Halliday, Josh. “Shoreditch Cereal Killer Cafe Targeted in Anti-Gentrification Protests.” The Guardian, September 27, 2015. https://www.theguardian.com/uk-news/2015/sep/27/shoreditch-cereal-cafe-targeted-by-anti-gentrification-protesters.
Nokes, Caroline. “Statement of Changes to the Immigration Rules.” UK Parliament, March 7, 2019. https://questions-statements.parliament.uk/written-statements/detail/2019-03-07/HCWS1388.
Gillet, Kat. “TechHub May Be down and out in London, but Not in Eastern Europe.” Sifted, August 7, 2020. https://sifted.eu/articles/techhub-london-riga-bucharest/.
https://sfciti.org/sf-tech-exodus/
Asparouhov, Delian. “ok guys hear me out, what if we move silicon valley to miami.” Twitter, December 5, 2020. https://twitter.com/zebulgar/status/1334991230531301376.
Suarez, Francis. “How can I help?” Twitter, December 5, 2020. https://twitter.com/FrancisSuarez/status/1335037068108554241.
Bote, Joshua. “Thinking of leaving San Francisco? Miami’s mayor put up a billboard just for you.” SF Gate, February 19, 2021. https://www.sfgate.com/local/article/Thinking-of-leaving-San-Francisco-Miami-s-mayor-15963190.php.
US Census Bureau. “Press Release: New Vintage 2021 Population Estimates Available for the Nation, States and Puerto Rico.” December 21, 2021. https://www.census.gov/newsroom/press-releases/2021/2021-population-estimates.html.
Nicol, Ryan. “Data Show Tech Workers Moving to Miami—and Fleeing San Francisco—During Pandemic.” Florida Politics, May 10, 2021. https://floridapolitics.com/archives/428057-data-tech-workers-moving-miami/.
Madrigal, Alexis C. “Who’s Really Buying Property in San Francisco?” The Atlantic, April 19, 2019. https://www.theatlantic.com/technology/archive/2019/04/san-francisco-city-apps-built-or-destroyed/587389/.
Dougherty, Conor; Burton, Andrew. “A 2:15 Alarm, 2 Trains and a Bus Get Her to Work by 7 A.M.” The New York Times, August 17, 2017. https://www.nytimes.com/2017/08/17/business/economy/san-francisco-commute.html.
Liu, Jennifer. “HR Experts: Companies Requiring in-Office Work Could Lose Out on 70% of Candidates—Employees Are ‘Calling the Shots.’” CNBC, November 2, 2021. https://www.cnbc.com/2021/11/02/businesses-without-flexible-work-miss-up-to-70percent-of-job-candidates-hr-experts-say.html.
Johnson, Mark. “The ‘Zoom Towns’ Luring Remote Workers to Rural Enclaves.” BBC Worklife, June 8, 2021. https://www.bbc.com/worklife/article/20210604-the-zoom-towns-luring-remote-workers-to-rural-enclaves.
GlobeTrender. “Madeira Launches ‘Digital Nomad Village’ with Free Workspace.” GlobeTrender, February 10, 2021. https://globetrender.com/2021/02/10/madeira-digital-nomad-village-remote-working/.
Newman, Daniel; O’Dell, Kennedy; Fikri, Kenan. “Report: How Tulsa Remote Is Harnessing The Remote Work Revolution To Spur Local Economic Growth.” Tulsa Remote, November 2021. https://eig.org/wp-content/uploads/2021/11/Tulsa-Remote-Report.pdf
Wall Street Journal. “How Small Cities Are Luring Remote Workers Away From Tech Hubs”, March 5, 2021. https://www.youtube.com/watch?v=oxiGJ7cGku4.
Galloway, Lindsey. “Malta: The Island Welcoming Digital Nomads.” BBC, September 11, 2021. https://www.bbc.com/travel/article/20211109-malta-the-island-welcoming-digital-nomads.
The Local Italy. “Will Italy Really Pay You to Move to Its ‘Smart Working’ Villages?” May 11, 2021. https://www.thelocal.it/20210511/will-italy-really-pay-you-to-move-to-its-smart-working-villages/.
Cater, Deborah. “Spanish Villages Enticing Remote Workers with Relocation Packages.” In Spain News, August 19, 2021. https://inspain.news/remote-spanish-villages-entice-remote-workers-with-incentives/.
Williams, Ollie A. “The War For Digital Nomads Heats Up As Greece Passes New Tax Law.” Forbes, December 3, 2020. https://www.forbes.com/sites/oliverwilliams1/2020/12/03/the-war-for-digital-nomads-heats-up-as-greece-passes-new-tax-law/.
Mercer. “Quality of Living City Ranking.” Mercer, 2019. https://mobilityexchange.mercer.com/Insights/quality-of-living-rankings.
WorkMotion. “The Cities Best Facilitating Remote Work: A Global Index.” April 28, 2022. https://workmotion.com/best-remote-work-cities/.
Nestpick. “The Work-from-Anywhere Index,” 2021. https://www.nestpick.com/work-from-anywhere-index/.
Chan, Samantha. “The most expensive and affordable cities for coworking globally.” Human Resources Online, June 8, 2021. https://www.humanresourcesonline.net/the-most-expensive-and-affordable-cities-for-coworking-globally.
Levels, Pieter. “Nomad List: Open.” Nomad List. Accessed June 17, 2022. https://nomadlist.com/open.
Levels, Pieter. “The 2022 State of Digital Nomads.” Nomad List. Accessed Nov 30, 2022. https://nomadlist.com/digital-nomad-statistics.
Wainwright, Oliver. “‘Everything Is Gentrification Now’: But Richard Florida Isn’t Sorry.” The Guardian, October 26, 2017. https://www.theguardian.com/cities/2017/oct/26/gentrification-richard-florida-interview-creative-class-new-urban-crisis.
Florida, Richard L. The New Urban Crisis: How Our Cities Are Increasing Inequality, Deepening Segregation, and Failing the Middle Class— and What We Can Do about It. New York: Basic Books, 2017.
Salinas Arreortua, Luis, and Ana Pardo Montaño. “Urbanismo Neoliberal En La Expansión de Las Ciudades. El Caso de Ciudad de México.” Bitácora Urbano Territorial 28, no. 1 (January 1, 2018): 113–19. https://doi.org/10.15446/bitacora.v28n1.57537.
Sherman, Becca. “Do Yourself a Favor and Remote Work in Mexico City — It Is Truly Magical.” Tweetstamp, February 16, 2022. https://tweetstamp.org/1493760533564063744.
Google Maps. “El Parián: Pasaje Comercial El Parian.” Accessed November 30, 2022. https://goo.gl/maps/ga3MMgdFsqXBac3Q9.
Mega Media Group. “Foreigner recommends working remotely in CDMX and ‘it rains’ criticism on Twitter.” Diario de Yucatán, February 18, 2022. https://www.yucatan.com.mx/mexico/2022/2/18/extranjera-recomienda-trabajar-distancia-en-cdmx-llueven-criticas-en-twitter-299914.html.
Babalola, Ayoola; Ayomide, Chukwuemeka. “Nigeria’s Internet amongst World’s Slowest, Most Expensive: Report.” People’s Gazette, September 29, 2021. https://gazettengr.com/nigerias-internet-amongst-worlds-slowest-most-expensive-report/.
Onafuye, A. “Nigeria doesn’t even have the infrastructure to support remote work.” Twitter, March 5, 2022. https://twitter.com/FunkeOnafuye/status/1500232001034596354.