The new world of remote work has exploded the growth of small and medium-sized cities, considered by workers as alternatives to large metropolitan areas. But is this good or bad?
At the end of a strict five-month lockdown in Santiago, Chile — a sprawling city of around seven million people — Gonzalo Fuenzalida ended up getting fed up with urban life.
Owner of the Chile Nativo tourism agency, specializing in adventure travel, he always wanted his family to live closer to nature. So in December 2020, they took a month-long exploratory trip to the small resort town of Pucón, located in the shadow of a steaming volcano 780 km south of the Chilean capital.
Three months later, Fuenzalida rented a house in Pucón, near Lake Villarrica, where he and his wife now spend their free time cycling, camping and paddleboarding. The couple’s seven-year-old son is studying in the nearby town of Villarrica, where Fuenzalida has rented an office measuring two by three meters to work.
“Our lives are better now in every way,” he says.
Of course, the change brought its challenges. Fuenzalida, 56 years old, says that the speed of the internet is much lower than that available in Santiago, which makes it difficult to manage the company from his home – which, according to him, “is in a black hole”. And he hasn’t entirely shied away from traffic, which can delay him for hours during the region’s peak summer tourist season, especially now that the number of permanent residents has soared.
Like Fuenzalida, more than 380,000 people moved from Santiago in the first year of the pandemic. Most now live in small and medium-sized cities like Pucón, with more space and greater natural attractions. This phenomenon has occurred all over the world, with workers avoiding major metropolitan regions and their high cost of living in exchange for cheaper rural areas that suit their lifestyles.
Big city problems?
With the pandemic decoupling work from the office, it is now possible to live in regions that historically did not offer work for some professionals. And for some small and medium-sized cities, this is an opportunity to reverse the brain drain, fight an aging population and pump money into municipal coffers.
But, on the other hand, this new trend distorted the real estate market, made it impossible for local working class residents to buy or rent real estate due to high prices and took problems from the metropolis to small towns, totally unprepared for this situation.
This scenario is particularly observed in the mountainous region of the western United States, where the three states with the highest percentage of growth between 2020 and 2021 are located: Idaho, Utah and Montana.
American consulting firm Oxford Economics recently declared that the city of Boise, Idaho, has the most expensive real estate in the United States, due to the arrival of new remote workers from high-end coastal cities such as Seattle and San Francisco.
The average home price in Boise (which has a population of 235,000) is now $535,000 — 10 times its average income. And a similar study by the Atlantic University of Florida in the United States showed that three cities in the neighboring state of Utah—Ogden, Provo and Salt Lake City—were also among the 10 most overvalued real estate markets in the United States.
Danya Rumore, a researcher at the University of Utah and founder of the Natural Portals and Enchantments Region Initiative (GNAR), lives in Salt Lake City. “We used to call it Small Lake City [‘Cidade do Lago Pequeno’, em tradução livre]”, she recalls. “But we’re really starting to feel that she [agora] feels much more like a big city, with obvious changes in community dynamics.”
Big city problems such as downtown transformation, homeless people and air pollution are on the rise, according to Rumore. In addition, the overheated housing market (exacerbated by short-term rentals) has made it difficult for service industry companies to retain their employees, as they are unable to pay the rent on their homes.
Rumor notes that Salt Lake City, home to about 200,000 people, is an example of the many urban centers in the western United States that are known for their natural charms, good recreation opportunities, access to open spaces, and high quality. of life.
“With the changes that have taken place over the last year, we are seeing money coming into these communities,” she says, as many of the new residents still earn their income in high-income regions but now live in a lower-income region. “It’s a major transition that happened overnight and it will really take several years for markets and communities to adjust.”
For Rumore, there are two possibilities for the development of this transition. In the most idealistic scenario, newcomers connect to the community and their income and resources promote the development of all. But in the most worrisome scenario, it may be more common for newcomers to exploit the community, driving up prices, and their purchasing power begins to oppress people with jobs linked to local businesses.
Opportunity that arrives
This trend of migration from large cities has caused some controversy in the United States, but there is a very different approach on the other side of the Atlantic.
With an average age of 42, Europe is the oldest continent in the world. Low birth rates and mass migrations to major European urban centers — such as London, Paris and Madrid — mean that medium-sized and small cities have been shrinking for decades. But for many of them, the pandemic offers a glimmer of hope.
“There is an unprecedented opportunity in Europe to save many rural areas,” says Marcus Andersson, CEO of Future Place Leadership, a consultancy based in Stockholm, Sweden, which has studied the consequences of remote work and new patterns of relocation.
“Lots of [dessas áreas rurais] they’re on the brink of bankruptcy — they can’t survive as functioning locations or administrations — and this is a really great opportunity… because they’re attracting exactly the people they need to attract: people who have children or are on the way to establishing a family. “
Ireland, where the divide between rural and urban areas dominates politics, seized this moment like nowhere else in Europe. In March 2021, the country made a major effort to decentralize the capital, Dublin, with a new rural development policy, described by the Minister for Rural and Community Development Heather Humphreys as “the most ambitious and transformative policy in rural Ireland in recent decades.” “.
The plan includes an investment of 2.7 billion euros (R$ 16.2 billion) to install ultra-fast broadband internet throughout the country. The idea is to transform pubs that are now failing into work centers, offering a new lease of life to decaying small towns.
The initiative also provides millions of euros in financial support for regional governments to turn vacant real estate into a network of more than 400 remote work facilities, as well as tax breaks for individuals and businesses that support teleworking.
Japan (which is the oldest country in Asia, with an average age of 47) took a similar approach in April 2021, offering 1 million yen (R$ 46,200) to workers moving to rural areas. , from where they would remotely connect to their jobs in the metropolitan area of the capital, Tokyo, which is home to 30% of the country’s population. The Japanese rural revitalization plan also provides up to 3 million yen (R$138,700) to people who establish new information technology companies in rural areas.
Will they stay or do they intend to return?
Of course, in Japan and the rest of the world, the question remains: will people who have moved to medium-sized and small cities remain living in these places after the pandemic passes?
Marcus Andersson believes creating the right ecosystem will be critical to capitalizing on this opportunity, as remote workers don’t just work from home. They work in cafes, bars, co-working spaces and community centers.
“What these places need is to create meeting spaces for people and networks where they can interact, learn from each other and grow together,” he says. “They need to offer a little bit of what big cities used to be for people, for companies and for innovation.”
Overall, Andersson believes that people who have moved from major metropolitan areas will stay in their new homes, but may also maintain connections to where they came from, such as a smaller apartment or co-living place. “We’re coming out of a situation that was exclusive,” he explains. “Now, you can be in both places.”
Danya Rumore says she has seen empirical evidence in the United States that some big-city workers who moved to small tourist towns in the past year are now moving again. But they are not necessarily coming home.
“When you realize that you don’t want to live in a small town in Utah, but that Salt Lake City also has really good outside attractions, you think, ‘I think I’m going to move there instead of Seattle or Silicon Valley,'” she explains — and points out that this can add even more tension to cities in the mountainous region of the western United States.
Gustavo Fuenzalida, in Chile, has no plans to give up his life in the tourist city of Pucón anytime soon. He is part of a strong community of outdoor enthusiasts, found solutions to his internet problems and bought land in the woods to build a new home and office.
“For a family like ours, really connected to nature, this is exactly the life we wanted,” he concludes.
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I have over 8 years of experience in the news industry. I have worked for various news websites and have also written for a few news agencies. I mostly cover healthcare news, but I am also interested in other topics such as politics, business, and entertainment. In my free time, I enjoy writing fiction and spending time with my family and friends.
