The Rise of WFH Accelerates The Pace of Climate Change Adaptation
Back in 2021, Yale Press published my book Adapting to Climate Change. In 2022, University of California Press published my WFH book “Going Remote”. In this brief essay, I’d like to connect some of the themes of these two books.
WFH workers (even if they go to the office 2 or 3 days a week) can live further from where they work. This increase in their commuting radius expands the number of residential areas they can afford and choose from. This allows those who are risk averse to better protect themselves and their families from anticipated challenges. First Street Foundation provides pinpoint data on locations facing less heat, fire, wind and flood risk and if local land use zoning rules permit it then the areas that are relatively safe will up zone and build more housing there and new communities will grow. My Business Insider piece from 2022 offers some predictions.
Yesterday, I published a new Business Insider piece on how center cities such as Manhattan and San Francisco will respond to this rising competition as footloose WFH workers “vote with their feet” and can move away from low quality of life areas.
While some leading real estate scholars worry about the short run “Office Apocalypse”, we counter that the expectation of “crisis” creates an opportunity to change the urban rules of the game to improve local quality of life to better compete for the footloose WFH. If cities such as NYC face climate risks such as flooding going forward, then the WFH challenge only increases the incentives of the local leaders to issue municipal bonds to pay for infrastructure projects to increase the city’s resilience. Spatial competition is a good thing that protects both the places and the urbanites from emerging threats. This was the theme of my 2010 Climatopolis book.
If those who are truly afraid that NYC faces significant climate risks can engage in WFH then they are free to choose to live further away in their own Xanadu. This creates a new opening for a young person who wants to live in NYC to find more affordable housing there. Markets accommodate our diversity. WFH unbundles place of work from place of residence and allows more of us to freely choose where we want to live while down weighting the importance of a short commute among our locational determinants.
Suppose a declining city such as Baltimore or Buffalo proves itself to be climate resilient through a combination of natural advantage and wise policy. It will attract footloose educated people to move there. This will stabilize the tax base and build up the upper middle class population. My blog post explores this point.
In my 2022 Going Remote book, I argue that major firms will use their data to see where WFH/hybrid workers are living. If they cluster in a given areas such as somewhere in Colorado, then the firm has an increased incentive to build a HQ2 close to there to facilitate face to face interaction. Note that this dynamic means that if WFH workers cluster in climate resilient places that firms will start to move some of their operations closer to such areas.