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Second-Order Effects

Derek Thompson’s writing for the Atlantic has been some of the most interesting this year. His latest, The Workforce Is About to Change Dramatically, is worth a close read. He gives good arguments for and against how remote working will change real estate, entrepreneurship, and something I’ve been meaning to write about but he did a much better job, how the great migration happening away from superstar cities could reshape politics.

I sincerely hope that all the people moving to new places are registering to vote in their new home, as I did when I moved from San Francisco back to Houston in 2011. The following year was 2012 and in Harris County (Houston) with 4.263 million people, Obama won by 585 votes. I was one of those votes.

8 replies on “Second-Order Effects”

As the author of the article notes, these trends were already happening — COVID-19 just accelerated them. To wit:

1.) The amount of money companies can save on renting commercial spaces is massive if most of their employees are working from home. But of course it comes at a cost to the larger economy. So, short term financial gains can lead to long term financial hazards if a downward spiraling effect starts to chip away at profits — some of which come from having a healthy economy for a wide swath of the population.

2.) Remote work means more flexibility in where one lives — well, for those whose jobs allow for remote working. You used to live in the Bay Area, so you know how soul-crushing a daily commute can be — either driving or getting packed into BART trains. For those who pay $3400 + for a studio or one bedroom, commute to a job, and then come home late only to start the routine over again have to be asking themselves after years of doing such a grind: “Is this all there is?” Even with a comfortable six-figure salary, the cost of living in Superstar Cities has got to eat away at your net income like crazy — to the point where it’s kind of the Law of Diminishing Returns.

3.) We are seeing a political change in places like Texas. I think the candidacy of Beto O’Rourke and many others demonstrate that The Lone Star state isn’t firmly in the GOP’s pocket.

4.) Right now the big exodus is from SF to the North Bay — if you can afford and want a single-family home. Sacramento and Lake Tahoe are seeing sizable upticks in their populations because of people looking for bigger houses and a better quality of life. Pretty soon, you’ll see a high-end chefs and others make tracks to where the money is and set up shop. After years of that kind of migration, the locals will be screaming about how city techies paved paradise. 🙂

Great points, I live in the Denver area and see all of these in play.

1) Everything downtown and near our “tech center” is hurting due to fewer people being there.

2 and 4) Housing costs continues to go up though due to so many people wanting to move to the area for the lifestyle.

Denver certainly is a desirable location! Two of my former co-workers moved there from SF (one moved back to Denver because she’s originally from there). Both say they love being in a Rocky Mountain State where there’s a lot of outdoor activities to do. However, as you note, the price of real estate is going up as more and more people look for quality of life — and a bigger house. I’ve only been to Colorado twice. Once on a family camping trip to Dinosaur National Monument (in the late ’70s), and the airport in Denver for a connecting flight.

How ironic the effects of woke politics is causing you to flee a blue state and you are trying to bring the same problems to Texas.

I’m actually born and raised in Houston, and a sixth generation Texan. I went to San Francisco for economic opportunity. I wasn’t fleeing it when I left in 2011, I just wanted to be closer to my family and friends and since I work on the internet and my company (Automattic) is fully distributed, I could keep that same opportunity and impact of my work even while shifting my homebase back to my original home. I do have disagreements with certain things in San Francisco and California, and as a citizen who’s still loves SF and CA I try to support political candidates there who I think will have a positive impact.

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