Want to live in Georgia? The city of Savannah will pay $2,000 to people who move there and telecommute, even if they work for an out-of-state business. Want to live in the other Georgia? The country has a special visa program for foreigners who want to come to the Caucasus and telecommute from Tbilisi.
Remote work has taken off during the pandemic, sparking competition to lure workers who suddenly have the freedom to live anywhere on earth. The fight to attract new residents has taken on particular urgency as more employers signal that work-from-home is here to stay, even post pandemic. Indeed, the number of permanent at-home workers is expected to double this year.
And thus some of the anxiety in Massachusetts, one of the states that could easily be on the losing end of remote work migrations. Governor Baker recently commissioned a study on the future of work in the state, and regions and municipalities also will need to develop an effective strategy to manage the shift to telework.
Let’s face it: For all its world-class schools and hospitals, historic sites, vibrant urban centers, and legal cannabis, Massachusetts, especially Greater Boston, is expensive. It’s cold. There’s an income tax, a sales tax, a motor vehicle tax . . . and so forth. When people had to live here to access the state’s high-paying jobs, they grumbled about the costs and the snow shoveling but had little choice but to accept them. Suddenly, that’s changing.
“There’s absolutely a concern,” says Eileen McAnneny, the president of the Massachusetts Taxpayers Foundation, which published a recent report on the impact of telework on Massachusetts. “People have more choices than they did before the pandemic.”
Losing people would be bad for businesses, bad for neighborhoods, bad for cultural institutions. On a more nuts-and-bolts level, it would also be bad for the state Treasury: Massachusetts relies more heavily on income tax revenues to fund state government services than almost any other state. An abrupt one-way migration of white-collar workers, leaving a shrinking base to foot the state’s bills, is the last thing the Commonwealth can afford.
The state already is playing defense, in a legal fight with New Hampshire that may preview the way remote work scrambles state economies. Before the pandemic, more than 100,000 New Hampshire residents commuted into Massachusetts for work, meaning they paid Massachusetts income tax on the money they earned in the Bay State. Now many of those workers are logging in from home. But the Commonwealth has asserted those New Hampshire residents must continue to pay Massachusetts income taxes as if they still physically worked in Massachusetts — the first time Massachusetts has made such a demand. New Hampshire, backed by Texas, Connecticut, and a dozen other states, has cried foul, asking the Supreme Court to stop the Commonwealth from “reaching across its borders into the wallets of New Hampshire residents.” Massachusetts says its policy is only temporary. But five states — Arkansas, Delaware, Nebraska, New York, and Pennsylvania — have similar, permanent policies. New Hampshire and its allies want the court to stop not just Massachusetts from taxing out-of-state residents but also to strike down the rules in those five states, too.
Even if Massachusetts dodges that bullet, Congress is considering legislation that would require workers to be physically present in a state for a minimum number of days before they can be taxed there.
What Massachusetts really needs is people — and it should be able to attract as many as it loses.
“If the policy is done right you could have just as many people who want to live here as, in theory, want to leave,” said state Senator Eric Lesser, who is promoting Western Massachusetts as a destination for newly liberated teleworkers. Before the pandemic, Lesser had introduced legislation offering $10,000 payouts to people who relocated to western Massachusetts, but he didn’t refile the legislation this year, saying such a rich incentive isn’t necessary anymore. Instead, he said, the state should focus on building high-speed broadband networks and transportation connections that will make the region attractive.
The sweet spot for Massachusetts, Lesser said, is targeting “hybrid” workers, who typically work at home but want to get to Boston or New York for the occasional meeting. He points to Chicopee, with its low-cost Internet service, and Springfield, with its plentiful housing stock, as communities that could come out ahead in a remote-work world.
The same is true for some of the state’s gateway cities. As MassInc pointed out, some smaller cities in Massachusetts are well suited for smaller satellite offices that more employers are likely to have after the pandemic. When there’s no need for a big office in Boston, a small office in Lowell suddenly makes a lot more sense.
Still, it’s inevitable that some workers, freed from an office and a commute, will leave Massachusetts. Some employees who used to drive in from Rhode Island or New Hampshire will probably embrace work-from-home for good. But the same shifts driving those taxpayers out of state can be a blessing in disguise that reinvigorates communities that have been waiting for a transformative opportunity.
Editorials represent the views of the Boston Globe Editorial Board. Follow us on Twitter at @GlobeOpinion.