tech nations economic metro big would work

techsuch May 9, 2021 0 Comments

Could Big Tech’s move to permanent remote work save the American heartland?Last week, Facebook announced that as many as half of its employees couldpermanently work from home in the coming years, as the COVID-19 pandemiccontinues to upend traditional office routines. Twitter was rightly abuzz atthe move:Facebook’s announcement, following a similar one from Twitter, may be asimportant for the nation’s traumatized economic geography as it will be forgeneral office culture. Suddenly, it looks as if the COVID-19 pandemic couldallow not just localized telework, but a more fundamental dispersal ofAmerica’s highest-value employment away from large “superstar” metro areas andinto the lower-priced American heartland.Such dispersal would be a welcome change. As Brookings Metro and others havestressed, Big Tech—a stand-in for America’s highest-value industries—has beenwidening the nation’s regional economic divides due to the heavy concentrationof its workers in a short list of coastal tech hubs, beginning with the BayArea.Based on hyper-intense agglomeration dynamics, Big Tech and the broaderinnovation sector have generated significant technology gains and wealth forthe country. But they also have greatly exacerbated a growing gap between thenation’s superstar cities and most everywhere else.Neither market forces nor bottom-up economic development efforts have closedthis gap. According to Brookings calculations, over one-third of the nation’sdigital services job growth in the last decade was concentrated in just fivemetropolitan areas: New York, Seattle, Boston, San Francisco, and San Jose,Calif.As a result, growth in other places has been stymied—to the point that just 16of the country’s 100 largest metro areas managed to increase their share ofthe nation’s digital services economy by more than a tenth of a percentagepoint. As for the rest of the nation’s large metro areas, no less than 63 ofthem saw their share of the tech sector actually decline due to slow ornegative growth.The upshot: Big-tech job concentration—prompted by self-reinforcingagglomeration economies as well as management groupthink—has driven a trulyruinous degree of territorial polarization. Superstar metro areas must contendwith skyrocketing home prices, homelessness, and traffic gridlock, while thenation’s left-behind places face economic stagnation and underdevelopment.This is why the Facebook and Twitter announcements are such a big deal. Thesecompanies’ move to permanent remote work is not just a signal that work withincities may soon be reorganized. The announcements could also forecast a degreeof tech decentralization across the continent that no amount of real estateappreciation, pleas from heartland leaders, and promises to open branchoffices have been able to achieve.Decentralization has been slow to occur so far, as big coastal hubs like SanFrancisco and Seattle continue to accumulate tech sector jobs. Yet even if,over a decade, staffing adjustments like Facebook’s shifted just 10% of techsector employment into towns and cities across America, the change wouldachieve a genuine benefit for the country.Such an adjustment would ease the economic costs of tech sectorhyperconcentration while reducing the heartland “brain drain” that has leftmany areas with thinned talent reservoirs. It would bring opportunity closerto people that are otherwise deprived of it because they live in the “wrong”place for dynamic economic growth. And it might begin to tamp down thenation’s simmering distrust of distant, high-tech elites.If delivered on, Facebook’s plan to allow employees to work outside ofexpensive, superstar cities really does seem like a watershed moment.Widespread remote work, especially in the tech sector, might very well prompta degree of geographic healing that would counter decades of economicdivergence which have left so many American places and people behind.

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