Work from home and big city out-migration before and after the pandemic

Abstract

Many argue that the significant shift to work from home following the pandemic could lead to large and lasting geographical effects regarding where people choose to live and work. This study is among the first to explicitly analyse how the potential for remote work at the individual level affects migration patterns of those living and working in metropolitan centres. The empirical analysis focuses on Stockholm City, examining workers who continue to work in the city but may choose to relocate their residence outside of Stockholm. The potential effect of working from home on the spatial decoupling between place of residence and place of work is thus at the centre of the analysis. The study is based on detailed population-wide microdata and covers the period from 2016 to 2023. The results indicate that, following the pandemic, workers in remote work-compatible jobs are more likely to make counter-urban moves while retaining their city centre jobs. This is particularly true for professionals with work-from-home jobs and pertains especially for moves to medium-sized cities or to small towns and rural areas. Although the estimated marginal effects are small in absolute terms, they represent more than a doubling of the baseline probability of making a counter-urban move.