The city of Topeka, Kansas estimates 10x in annual tax revenue for every $5k they spend in incentives to relocate high paying remote workers to their city. Small cities can build programs that attract individual remote workers that can have an immediate impact on taxes and boost the local economy.
See also:
- Two-thirds of remote workers want to continue to work remotely which increases the demand for relocation
- List of fully remote startups is growing which increases the supply side of the relocation market
- The ‘untethered class’ was most likely to migrate during the pandemic
Links to this note
Cost Rica Enacted a Law to Attract Digital Nomads
The new law turns enables a tourist visa for up to one year with proof of stable income and medical insurance. This is meant to attract digital nomads to spend more time in Costa Rica and thus spend more money there.
San Francisco Lost $400MM of Tax Revenue in 2021
San Francisco Mayor London Breed said that workers are not returning to the office which has resulted a loss of $400MM in tax revenue. Some of the reasons for this is fewer people in the city (while not an exodus, the office vacancy rate is more than 24%) but I suspect this is also due companies moving out of SF for tax reasons (Stripe moved to Oyster Point).
§ What Is the Market Value of Working Remote?
We can come up with a valuation of remote work by looking at a few signals: what you would forgo, what do you gain, what others gain, and what others lose.
Google Employees Could Face Pay Cuts Due to Working Remote
In a recent article in Business Insider, a leaked pay calculator and interviews found that some employees face pay cuts if they continue to work remotely. In one example, an employee based in Stamford, CT would face a 15% pay cut unless they worked from the NYC office (1 hour commute). Former San Francisco employees could face as much as a 25% pay cut.
Places That Will Pay You to Move and Work Remotely
List of places that will pay you to move and work remotely:
Nearly Half of Employees Are Likely to Move to Work Remotely
A survey by Microsoft found that 41% of employees are considering leaving their current job and 46% say they are likely to move to work remotely. This would result in a major change in the percentage of remote workers at companies compared to before the pandemic. A survey by McKinsey about remote work found that 20-25% of workforces in advanced economies could work from home after the pandemic.