Tech Industry

How COVID accelerated a shift that could put new cities at the forefront of American life

Our work and our lives may never return to a pre-pandemic normal, and that's caused some major shifts in where people are choosing to live in the US.

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Since the onset of the coronavirus pandemic, urban areas across the US have seen changes both big and small — one of the most notable being a population migration out of larger cities like New York and Los Angeles, to smaller cities like Denver and Miami. In fact, according to analytics firm CoreLogic, New York, LA and San Francisco had the most people leave their respective metropolises compared with anywhere else in the country during 2020. 

This migration was in motion before COVID-19, but it accelerated as remote work became an option for millions of people, many of whom sought out more space and a lower cost of living. 

"We've always been a very mobile country. I think if you looked around the world and picked any other country ... you wouldn't find the kind of North-South-East-West trajectories that seem to be very easily taken by Americans and are in fact part of our history," said Elizabeth Plater-Zyberk, a professor of architecture and the director of the master of urban design program at the University of Miami. "So this is just another episode in that story." 

Across the US, the number of people who made permanent moves was up 3% from March 2020 to February 2021, according to an analysis by Bloomberg. But when you take a closer look at a few of America's densest and most expensive metro regions, the data paints a different picture, with a larger percentage of the population moving out of those areas. It's a shift that has had far-reaching impacts on cities both big and small when it comes to urban development, housing prices and traffic flow.

Shift to remote work

As remote work policies spurred many people to change their location during the pandemic, some companies are still trying to figure out how to adapt to this new type of workforce. 

At Google, for example, the company announced in June that it had developed a tool for employees to see how their salary might change based on their region. The tool allows employees to request office changes or apply to become fully remote workers, and CEO Sundar Pichai announced plans for 20% of the company to permanently work remotely. Google didn't immediately respond to a request for comment.

Alex Coffman lived and worked in San Francisco for two years before the shift to remote work allowed him to leave the city for the sunnier skies of Miami. While he says the move wasn't spurred specifically by the pandemic, he also notes that without the option to work remotely, he may not have been able to relocate. 

"A lot of technology companies and sort of high-end financial companies focus on New York and San Francisco labor markets, and that is changing quite quickly ... but at the same time, I still believe it would be significantly more complicated for me to find an equivalent job in the Miami labor market," Coffman said. "A lot of peers of mine sought out roles in New York or San Francisco, and then as soon as they had the capacity to leave [they did] — some of them are in Oklahoma, some live in Washington, some live in Texas. And they've essentially kept the jobs that they had as former San Francisco and New York employees." 

Migration from America's largest cities

Most people who moved during the pandemic stayed within the same state. Despite talks of mass moves to Florida and Texas, most people who moved didn't go very far. Data shows that the pandemic accelerated an existing trend of more people moving outward to suburbs and surrounding areas of their former cities like San Francisco and New York. 

One factor that did affect major cities, especially ones in California, was a decrease in people migrating into the state. California's population and job growth have both slowed, with many citing concerns about high taxes, the cost of living and heavy regulations. In 2020, over 135,000 more people left California than moved in, the third largest net migration loss ever recorded for the state, according to CNBC

"Once you were deprived of the opportunities that a fully open Los Angeles, or for that matter, a fully open San Francisco offered you, it was very hard to justify the cost of housing here," said Michael Manville, an associate professor of urban planning at UCLA and the research program lead of traffic at the UCLA Institute of Transportation Studies. 

Migration to smaller cities 

People who left California largely moved throughout the Western coastal states. However, people leaving Los Angeles specifically tended to make their way eastward, to places like Las Vegas, Phoenix and even Miami. 

"Many cities that might tell you they've been languishing economically are experiencing new interests, new residents and businesses," Plater-Zyberk said. 

Florida is one of nine states with no state income tax, a big attraction for those moving out of certain states that have high income tax rates. Almost 330,000 people moved to the state of Florida between April 2020 and April 2021, and experts expect that kind of population growth to continue through 2025. Data from Move.org shows that Florida was the top destination for relocating Americans in 2020. 

Like Miami, Denver saw an increase in people moving to the city during the pandemic. But what sets Denver apart as a new destination is its relatively high cost of living. 

"Our population numbers have just been growing pretty steadily, and everything that is part of normal everyday life is just a little bit more complicated, a little bit more crowded," said Andy Goetz, a professor in the department of geography and the environment at the University of Denver.

And it wasn't just individuals who moved during the pandemic. Several major tech industry leaders pulled out of Silicon Valley altogether. Oracle moved its headquarters to Austin, Texas; Hewlett-Packard Enterprise moved to Houston; and Palantir went to Denver. The CEO of Dropbox also moved to Austin, and while the company's headquarters are still located in San Francisco, it's taking a virtual-first approach for its workforce allowing employees to predominantly work from home. 

Elon Musk also left Silicon Valley for Texas last year to focus on two big priorities for his companies: SpaceX's new Starship vehicle launch site in Brownsville, and moving Tesla's headquarters to Austin. But Musk did say that in addition to the Texas operations, Tesla "will be continuing to expand" its activities in California as well. 

Some cities are even offering tax incentives for companies to move their businesses. Miami-Dade County, for example, offers a myriad of business incentives such as state and local tax breaks for companies relocating to areas that have been designated as having economic development priority. 

"There is an influx of tech industry, and there's also a great attention to incubating businesses. All of a sudden, it's evident that this is happening in a big way," Plater-Zyberk said. 

Traffic changes

This urban shuffle across the US is also having an effect on traffic patterns. 

Brian Taylor, director of the Institute of Transportation Studies at UCLA, told the LA Times that there are two variables when it comes to traffic. The first is vehicle traffic, which is how much people drive. The second is traffic congestion, which is what causes delays. 

Congestion occurs when many people are going to the same destination at the same time, and this very thing is seeing a shift. 

"We've definitely noticed that there has been an increase in the volume of traffic in Denver," Goetz said. "Vehicle miles traveled have increased significantly. And then with the pandemic, public transit has really dropped off."

Goetz said that skyrocketing housing prices in Denver are also contributing to increased traffic, as more people are having to find places to live further away from the city center. In contrast, Plater-Zyberk says the influx of new residents to Miami has created greater demand for a more walkable city. 

"You know, if you were to drive west to the western reaches of South Florida, you would see pockets of walkable and less auto-dependent urbanism," Plater-Zyberk said. "It's definitely changed, I think, largely by remote work."  

In bigger cities like Los Angeles, the once jaw-dropping empty freeways during COVID's early days have filled right back up with cars again. 

"Right when the pandemic began, and California first entered a lockdown, traffic just plummeted to levels we have probably not seen in 100 years," Manville said. "And right now, with something close to, but of course not quite full reopening, we see congestion levels and traffic levels that rival pre-pandemic levels. So things have come back pretty fast." 

Although the infamous Los Angeles traffic is pretty much back to a pre-pandemic norm, Manville says emptier city streets during the coronavirus brought into sharp focus just how unsafe the city's street networks are. 

"It was very telling that early in the pandemic in California, you saw traffic crashes go down, right, because the typical crashes are just caused by vehicles being in close proximity to each other, but fatal crashes go up, because fatal crashes are caused by speed," Manville said. 

Public transit changes

A shift in the use of public transit has also played a role in changing traffic patterns in big cities. In New York City, the pandemic profoundly disrupted the Metropolitan Transportation Authority, throwing the largest public transit system in the US into a desperate financial situation. 

In Los Angeles, Manville said public health agencies advised people not to take public transportation during the early months of COVID. "I think there's a hangover from that, where people still really worry, perhaps rightly, perhaps wrongly, that their riding public transportation might put them at risk of COVID," Manville said. 

For many remote workers, especially those like Coffman who've moved during the pandemic, a return to the old ways of Monday through Friday office life isn't very appealing.  

"I will remain a remote worker, I believe, for the indefinite future. And I think that there is a really good reason to be in the office, which is that it's of course lovely to see people. And I could return to the office, but I don't have to. And I really don't want to, to be honest," Coffman said.

He also said that he has no regrets about leaving San Francisco for Miami but aknowledges he knows people who stayed where they were during the pandemic and love their city. 

"I've had family members who reside in the city of New York, didn't leave, stayed in New York, and then went right back to the office when it opened. And ultimately, they love the city of New York, and it's why they remained," he said. 

In the end, the pandemic may have accelerated the timeline of this urban shuffle across the US, but it's also a complicated issue that can't be easily pinpointed or defined. What is clear is that a good amount of people are on the move -- whether it's to live in a more affordable city, be closer to the outdoors or just for a change of scenery. And it's not slowing down anytime soon.