Bay Area Tech Workers Relocate
Remote Workers Flood Mountain States
A number of major tech companies headquartered in the Bay Area including Facebook (FB), Twitter (TWTR), and Stripe, have given certain employees permission to work from anywhere they choose going forward. As a result, tech workers are flooding western mountain towns like Boise, Idaho, and Park City, Utah.
These high-income transplants are benefiting their new communities in some ways by bringing in money and other resources. However, they are also driving up the cost of living, and some worry they will permanently change the culture of these small towns.
Rising Home Prices and Challenges for Local Companies
In Bozeman, Montana, the median home price climbed from $432,500 to $515,000 over the course of a year as a result of high-income professionals relocating to the town of about 50,000. Locals in Bozeman and in other, similar communities, worry that if resources are not devoted to cheaper housing, it will be difficult for some long-term residents to afford to stay.
Additionally, the influx of remote workers is creating challenges for tech companies already based in mountain states. Clearwater Analytics, a fintech company headquartered in Boise, has seen some of its workers leave to take jobs at Bay Area-based tech companies that offer them higher salaries but don’t require them to relocate.
A Boost for Local Economies and New Tech Company Policies
The impact of tech workers moving to mountain states has not been all negative. For local restaurants, bars, outdoors gear stores, and other businesses, newcomers have helped them weather a time when traffic from tourism is down due to the pandemic.
Additionally, some tech companies are implementing policies that will likely make it so their employees do not drive up the cost of living in small communities. For example, Stripe Inc. is offering employees a relocation bonus of $20,000 to move out of San Francisco, New York, or Seattle, but once they have moved to an area with a lower cost of living, they will take a pay cut of up to 10%. Other companies like VMware and Twitter are trying similar policies.
The long-lasting effects of this exodus from the Bay Area are difficult to predict. Investors in the tech industry as well as real estate professionals in tech hubs and in smaller mountain state communities will be carefully watching to see what impact this trend will have on their industries.
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