What will the rise in remote work mean for the Madison region?
A recent article by Brookings Institute looks at recent job location trends and explores what will happen after the pandemic. What does the information tell us about where future jobs will be located and what it means for the Madison region?
Following the Great Recession from 2007 to 2009, jobs concentrated in “superstar” metro regions like San Francisco and New York City as businesses and workers benefitted from greater access to jobs, labor pools, and investors. This trend was particularly true for tech jobs like those in the information sector.
With the so many more people working from home due to the pandemic, more workers are now leaving superstar regions than arriving. This reversal could be a harbinger of a long-term trend towards greater dispersal of workers.
The authors argue, however, that even with an increase in remote work, firms and workers will continue to seek the benefits of proximity. They point out that workers leaving superstar regions are mostly going to other large, dense areas like Austin and Miami rather than scattering across the country.
But the story within regions may be different. Inside regions, more remote work may foster the dispersal of housing as people commute farther on fewer days through flexible work options.
The Madison region is well poised to benefit from people leaving the biggest regions combined with the benefits of knowledge economy hubs. While Madison won’t attract the same number of firms and workers as Austin or Miami, it punches above its weight when it comes to knowledge jobs.
The article lists the 20 largest regions by growth of information sector jobs from 2010 to 2018. Madison is only the 89th largest region but its 5,392 increase in information jobs during that period (47%) puts it above seven of those top 20 regions – ahead of regions like Dallas, Portland, Orlando, and Nashville.
This growth potential for Madison comes with opportunity and challenge. Opportunity comes from more workers within a region choosing to live farther from the center city. Outlying communities could capture the economic and cultural resources of larger remote workforce by expanding downtowns, main streets, and other hubs of working and living.
A challenge comes from growing inequality that growing knowledge-based economies experience. Greater numbers of high paid tech workers can bid up the price of housing and overall cost of living, leaving other workers further behind. This disparity is true for the Madison region. The Brookings’ metro monitor ranks regions on a range of economic and inclusion measures. Among 57 large regions (populations between a half and one million), Madison ranked third best on the Prosperity index, but 46th on racial inclusion and 35th on geographic inclusion.