Virtual knowledge industry and the rise of penturbia

Regions and towns that boomed in the pre and post WWII industrial decades are now losing population, according to a recent article in The Economist. However, some are paying knowledge workers who can now work most anywhere to move to them in order to bolster their declining tax bases and ability to fund local services and pensions for retired local government workers.

In addition to the move in bonus, they also benefit from lower housing costs than in large metros. The newspaper cites Muncie, Indiana as an example. The city of 65,000 people has since 2021 it offered $5,000 grant entice virtual knowledge workers to make their homes there:

So far 152 people have moved to the city under the scheme, which is run by MakeMyMove, a firm based in Indiana which helps promote the incentive schemes of cities that are willing to pay people to move there. From its foundation in 2017 MakeMyMove has expanded enormously, says Christie Hurst, its spokeswoman, not least thanks to the pandemic, which freed many workers from having to go to an office. The result is a much larger pool of potentially mobile workers over whom cities can compete—hence the growth of the business. Yet a taxpayer gained by Muncie, Indiana, is one lost to somewhere else. And with growth overall slowing, not everywhere can win. In fact, remote-working may only hasten the decline of some struggling places, by making it possible for a worker in, say, Muncie, to relocate to a pretty mountain town in Colorado.

This trend was predicted by socioeconomist Jack Lessinger in his 1991 book Penturbia Where Real Estate Will Boom After the Crash of Suburbia. The penturbs represent America’s fifth major residential settlement pattern: regions and towns that lost population since 1970 but destinated to gain residents in future decades where housing dollars go further than metro suburbs and particularly high-cost suburbs close in to metro centers.

Lessinger’s forecast rise of the penturbs came before advanced telecommunications made possible by the Internet, setting the stage for its acceleration.