Richard Florida is a well-known adviser to cities and urban initiatives, including one in Oklahoma known as Tulsa Remote. He’s a professor at the University of Toronto’s School of Cities and Rotman School of Management.
Adam Ozimek is chief economist at Upwork, a company that connects businesses to remote freelancers. Florida and Ozimek recently co-authored an essay for The Wall Street Journal headlined “How remote work is reshaping America’s urban geography: Small cities and communities are turning into Zoom towns and competing with coastal hubs as workers move to find more space and lower costs.”
“A year ago, just before the start of pandemic lockdowns, some 10 percent or less of the U.S. labor force worked remotely full time,” they wrote. “Within a month, according to Gallup and other surveys, around half of American workers were at distant desktops. Today, most of them still are. And surveys of employers and employees alike suggest a fundamental shift. While forecasts differ, as much as a quarter of the 160-million-strong U.S. labor force is expected to stay fully remote in the long term, and many more are likely to work remotely a significant part of the time.
“This rapid reordering accelerates a trend that has been underway for years. And it doesn’t just change the dynamic between workers and companies. It is affecting the economic fates of cities and communities large and small, but especially smaller ones: They can now develop and build their economies based on remote workers and compete with big city business centers and West Coast high-tech meccas that have long dominated the employment landscape.”
Florida, of course, saw to it that Tulsa was included in the essay. But an initiative in an adjacent state also was mentioned.
“Smaller cities like Gilbert, Ariz.; Boulder, Colo.; Bentonville, Ark.; and Tulsa, Okla., have joined the competition, some of them launching initiatives specifically designed to appeal to remote workers,” Florida and Ozimek wrote. “And more rural communities–including Bozeman, Mont.; Jackson Hole, Wyo.; Truckee, Calif.; and New York’s Hudson Valley–are becoming the nation’s new Zoom towns, seeing their fortunes rise from the influx of residents whose work relies on such digital tools.
“A Pew Research survey in November found that about 5 percent of Americans had moved in the prior several months as a result of the pandemic–after only 9.3 percent moved for any reason in all of 2019, according to U.S. census data. Smaller cities and towns across the country are already benefiting as the destinations of these moves. The shift has profound implications for the U.S. economy.”
The Arkansas initiative mentioned in the essay isn’t limited to Bentonville. It’s a regional program in which the Northwest Arkansas Council offers a $10,000 incentive for those who put down roots in that corner of the state. The effort, dubbed Life Works, was announced in November.
At the time of the announcement, council officials said they would invest more than $1 million during a six-month period. The money came from the Walton Family Foundation at the suggestion of brothers Tom and Steuart Walton.
The program touts a low cost of living, outdoor recreational opportunities and growing arts, culture and culinary scenes in northwest Arkansas. There’s also the fact that the per capita income in the region is now 14 percent higher than the national average.
“Northwest Arkansas offers a unique opportunity to create balance for those eager to move from congested and expensive larger cities and suburbs,” said Nelson Peacock, the Northwest Arkansas Council CEO. “We’re not seen necessarily as a place to relocate to from the coasts. We need that visibility to get people here with the right skills to add value to our ecosystem.”
Participants must be at least 24 years old, have at least two years of work experience, have full-time employment, currently live outside Arkansas and be willing to relocate to northwest Arkansas within six months.
“We’ll assess the applicants’ skills with our region’s needs, as well as what they can add to our community,” Peacock said. “We’re not looking for someone who can only do a good job at work. We’re looking for people who will add vibrancy to our community.”
Peacock said there are more than 10,000 job openings in the region and a talent shortage in certain economic sectors. In addition to the $10,000, those accepted into Life Works receive a street or mountain bike or an annual membership to one of the region’s arts and cultural institutions such as Crystal Bridges Museum of American Art, the Momentary, the Scott Family Amazeum, TheatreSquared, the Walton Arts Center or the Walmart Arkansas Music Pavilion.
As noted in last Sunday’s column, northwest Arkansas’ growth didn’t slow during the pandemic. Home sales in the region have grown by double-digit margins during the past year as mortgage rates remain low and people flock to the area for jobs.
In March, the Skyline Report published by the University of Arkansas Center for Business and Economic Research showed record-breaking home sales in Washington and Benton counties along with a low inventory of homes on the market. The cost of purchasing a home increased 11 percent last year, averaging $268,987 in Washington County and $293,403 in Benton County.
I mentioned in that column how business and civic leaders in the region have their act together. I see no end in sight for the northwest Arkansas boom. A lack of affordable housing could be a problem, though.
Once more, the leadership is on top of things. Last month, a center focused on addressing housing affordability was launched by the Northwest Arkansas Council with Walton Family Foundation support.
“Teachers, firefighters, health-care workers and other residents face increasing obstacles in finding housing at affordable rates relative to their incomes,” Peacock said. “These barriers often prevent people from living in and contributing to the richness of the communities where they work. Ensuring our residents have quality, attainable homes must be a priority.”
Karen Minkel, who heads the foundation’s Home Region Program, said the housing center will “champion community-driven solutions that lead to dynamic neighborhoods and serve as a resource that helps the public and private sectors develop workforce housing options.”
In 2019, the foundation funded a study titled “Our Housing Future.” It predicted that more than 80,000 families will move to northwest Arkansas’ four largest cities–Fayetteville, Springdale, Rogers and Bentonville–by 2040. The region will need to build 2,900 housing units a year.
The four cities averaged 1,400 units annually from 2010-16. The report recommended that about half of the housing units be for what are known as workforce households, defined as families of four earning less than $78,000 annually.
“Springdale is growing rapidly and needs more housing options that are affordable to respond to the increased demand,” says Springdale Mayor Doug Sprouse. “I look forward to working collaboratively with the council and other community members to address this mounting challenge proactively.”
The Center for Neighborhood Technology in Chicago created an index to measure how savings on housing costs are offset by higher transportation expenses and increased commute times when people live a long way from their places of work. The center considers communities affordable if families spend no more than 45 percent of income on housing and transportation. Northwest Arkansas is at 52 percent.
As you can see, growth comes with problems. Still, the problems booming northwest Arkansas is experiencing these days are problems most other regions of the country wish they had.
Rex Nelson is a senior editor at the Arkansas Democrat-Gazette.