Remote worker migration expected to persist in 2023

Introduction

The widespread adoption of remote work arrangements has played a key role in explaining the turbulence that has characterized the rental market since the start of the COVID-19 pandemic. Newfound geographic flexibility has allowed workers to relocate from expensive markets to more affordable ones, and to spread out from the urban cores of large metros to their farther flung suburbs. Even as some employers have asked workers to return to the office, it seems clear that remote work will continue to be far more prevalent going forward than it was at any point prior to the pandemic. Recent Census data shows that the share of Americans who work primarily from home tripled from 2019 to 2021. In a recent survey, we found that the flexibility afforded by remote work is indeed leading to higher rates of mobility and shifting geographic preferences. Given their heightened propensity to move, remote workers have been having a disproportionate impact on housing market trends, and this is expected to continue into 2023 and beyond.

Compared to on-site workers, remote workers were more likely to move in 2022 and considered different factors when they did so

We surveyed nearly 6,000 employed American adults in December 2022, and found that those with remote work arrangements were far more likely to have moved into a new home over the course of the last year. Among workers whose jobs require them to be fully on-site, 17 percent moved in 2022. Meanwhile, 27 percent of workers in fully remote jobs moved, meaning that this group was 56 percent more likely to have moved than the on-site workers. The highest moving rates were observed among workers with hybrid remote arrangements – those who split time between working at home and on-site – 31 percent of whom moved in 2022, a rate of mobility that was 78 percent greater than that of on-site workers.

For the survey respondents who told us that they moved in 2022, we followed up with a more detailed question on the factors that motivated those moves. We found that those with remote working arrangements were not only more likely to move, but also considered different factors when they did so. A desire for more space was a major concerns for both on-site and remote workers¹, with 25 percent of both groups telling us that they moved into a larger home. However, factors concerning geographic preference were far more important for those with remote flexibility.

23 percent of remote workers told us that their move gave them greater access to natural amenities, compared to just 10 percent of on-site workers. We see a similar gap in the share who increased their access to urban amenities (23 percent for remote workers vs 16 percent for on-site). Remote workers were also more likely to have moved to be closer to family or friends, although this was an important factor for on-site workers as well. These results imply that remote work, even in hybrid form, is allowing some workers to move to locations that better suit their preferences now that they are less bound by job locations. In fact, more than one-in-five remote workers who moved in 2022 specifically told us that their remote work status was a motivating factor for their move.

Given the skyrocketing growth in housing costs in recent years, it is no surprise that affordability was also a major concern for both groups. Roughly equal shares of remote and on-site workers told us that they moved to reduce their monthly housing costs (23 percent and 22 percent, respectively). However, 21 percent of remote workers told us that they moved to a more affordable housing market, compared to just 14 percent of on-site workers. While remote workers may be able to relocate to alleviate affordability woes, on-site workers are bound to their job location, making such moves far less feasible.²

Remote workers were also far more likely to have purchased homes in 2022. This is likely attributable in large part to the fact that remote occupations tend to be higher-paying, on average, than on-site occupations.³ However, it may also be the case that some remote workers who could not afford to purchase homes in the market where their job is based are relocated to markets where homeownership is more attainable. These dichotomies highlight the ways in which remote work could actually exacerbate economic inequality.

Heightened mobility among remote workers will continue to impact migration patterns going forward

Looking forward to the year ahead, our survey results imply that we should expect to see heightened mobility among remote workers again this year. 27 percent of on-site workers told us that they are planning to move in 2023, compared to 36 percent of fully remote workers, and 44 percent of hybrid workers.⁴ Notably, most of this variation is due to within city moves; only a marginally higher share of remote workers are planning to relocate to a new city. It could be that the increased desire among remote workers to move this year has more to do with finding space that is better suited to doubling as an office, rather than a desire to move to a new market.

That said, when we ask about the specific factors involved in these planned moves, we again find that remote workers are more likely to choose factors that would tend to imply moving to a new city. One-in-four remote workers who are planning a move tell us that they want to take advantage of their remote flexibility. And compared to on-site workers, remote workers are again significantly more likely to tell us that they plan to move to a location with greater access to natural amenities (28 percent vs 21 percent) or urban amenities (26 percent vs 18 percent).

Our survey also indicates that we should expect greater movement among remote workers to persist beyond 2023. Among those not planning a move this year, we asked about longer term plans – 11 percent of fully remote workers told us that they are very likely to move to a new city within the next three years, compared to 6.5 percent of hybrid workers and just 3.5 percent of on-site workers.

Untethering housing choice from job location could lead to greater housing satisfaction

As shown above, individuals who do not need to take their job location into consideration when choosing a place to live are likely to place greater emphasis on other factors relating to their own individual preferences. It seems that this freedom of choice is leading to greater satisfaction in living arrangements for remote workers.

Nearly half of fully remote workers tell us that they are “very satisfied” with their current living arrangements, significantly higher than the 33 percent rate among on-site workers. Interestingly, those in hybrid work arrangements are least likely to report high satisfaction in their living situation. Hybrid workers may be able to consider a wider range of geographic locations – assuming that they’re willing to commute longer distances if those commutes are not daily – however, their options are still largely contingent on their job location. Such arrangements entail the downsides of having your home double as an office, without the upside of full geographic flexibility. These results indicate that remote work could lead to more favorable housing outcomes, but crucially, only for the minority of workers – typically in high-paid professions – who are afforded the flexibility.

Conclusion

The ongoing prevalence of remote work is set to be one of the key economic legacies of the pandemic. This large-scale forced experiment in how workplaces are organized was largely successful in proving that a significant share of knowledge sector jobs can be performed from anywhere with an internet connection. The rapid uncoupling of housing choice from job choice has had profound implications for the housing market in recent years, and there is good reason to believe that the dust has yet to fully settle. Remote workers are far more likely to be planning moves, and to be emphasizing factors that could lead them to relocate to a new market. Those with remote flexibility are still a minority in the workforce, but a rapidly growing one. And as they continue to account for an even greater share of moves, these workers will play a key role in driving domestic migration patterns this year and into the future.