I applaud Microsoft and Google for not going with a full RTO. But hybrid work still requires you to live near an office. True remote work enables an economy that is spread out, resilient, and lets people live the way they want. We have this capability so why not do it?
Aside from all the conversation about work culture, state taxes are a big barrier to fully remote work. States hate losing tax revenue. Notoriously, it is easier to register to do business in a state than to unregister. This is even harder internationally.
For large organizations, remote can be the difference between one state's paperwork + regs + taxation, and every state and country under the sun's paperwork + regs + taxation. That is a real burden. Not just the paperwork + administrative overhead, but being subject to differing employment + everything else laws from *everywhere* will really muck up ability to run a consistent business.
While fully remote startups can now access services to help with this, like PEO providers like Justworks/Deel, the reality is that most of the world is not setup to accept this at scale. I run a fully remote startup and still run into issues with vendor diligence departments and accounts etc. expecting us to have a physical office, and being totally bewildered when we don't. The people involved now understand remote work, but the systems --forms, insurances, tax nexus decisions, etc -- still very much aren't setup to handle it.
Notably: if you are a bigger company, you can't put the toothpaste back in the tube with all these local governments, and you bet that every locality will be trying to extract tax dollars from the big firms with deeper pockets.
We see this all the time working at the intersection of the insurance / fintech space. I've had several big, legacy vendors make requests for multiple physical signatures on a piece of paper (printed and mailed or faxed, can't just annotate a PDF) from people who haven't even met eachother in person let alone ever worked at the same address.
The kicker? These papers are access authorization forms to APIs.
Your average tech company is probably reasonably well prepared to go truly distributed, but I bet many of their vendors aren't. Whole workflows in certain industries don't even conceptualize companies with employees distributed across offices, let alone companies with no office at all.
(I've fought similar battles over not being able to provide a direct phone extension because I don't have a phone on my office desk and even if I did I'm not at the office anything close to full time, and I don't provide my personal cell phone number to vendors... but thats a whole different topic. Employees exist without phone numbers! Entire offices exist without phones!)
This is what we've eventually given up and done. At a certain point, the vaguely-principled stand gets in the way of business. We're playing in an old-school corner of the world and need to meet it in the middle.
is this your startup? I'd love to chat about what you've found work. we're in the intersection of fintech / wealth (which overlaps with insurance).
I've gotten by just fine for the past few years but we are starting to see more questions about this that require us to change our legal address away from a residence. I think we got away without much trouble solely because of the pandemic, and now it's over we're going to see a lot more questions about this.
It's not worth the future of the whole business to fight big vendors/customers over addresses.
Basically, for those who aren't living this, the physical address is mostly a liability thing. Insurance expect to be able to (imagine worst case scenario) walk into an office and blame / seize assets / arrest people if things go south. Sometimes you can just provide a residential address of a founder / board member, but all the diligence forms etc expect a physical office building where you can find all the employees 5 days a week if you just walk in.
> For large organizations, remote can be the difference between one state's paperwork + regs + taxation, and every state and country under the sun's paperwork + regs + taxation. That is a real burden. Not just the paperwork + administrative overhead, but being subject to differing employment + everything else laws from everywhere will really muck up ability to run a consistent business.
This is a real burden for small businesses. The nature of Amazon's business as an online retailer with a massive distribution network means that for any significant market they do business in, they will have employees. Practically speaking, this is a solved problem for any state in which Amazon has a warehouse (which I think is probably all of them for the US?).
All major payroll companies and employment law firms have long since figured out paperwork, taxes, and labor regulations in all 50 states. Unless you're so small that you don't even have an external payroll provider or legal counsel, "differences between States" shouldn't be a valid excuse.
While Amazon may have the administrative capacity for handling the filings, that doesn't address the tax revenue politics + considerations (which i didn't write much about in my earlier comment).
The issue of state tax breaks was such a big deal during their "HQ2" contest a few years ago that it actually became one of the top issues in the NYC elections that year. (to a large extent local candidate races became a referendum on how they felt about giving tax breaks to amazon in exchange for Amazon's commitments to employ a certain # of highly paid software + product people who would potentially contribute to the overall tax base. NYC people ended up electing politicians to stop the previously-negotiated pending deal with amazon, and amazon got enough blowback to say 'we give up' publicly.
> state taxes are a big barrier to fully remote work
What percentage of remote-workers are in a different tax-jurisdiction? Especially post-COVID I expected that the majority of remote-work involved people already in the same US state, merely with a nontrivial commute.
> But hybrid work still requires you to live near an office
Not as close as a daily commute, though.
I live 60 miles from my office. It's just not practical to go in every day, so I go in once a week. I can also go in as needed, such as if there's a special guest, event, ect.
I wish I could go in every day, but where I live is a compromise with my wife, and we have kids.
If I were to go in everyday, I'd need to be much, much closer to the office. It wouldn't work for my family: Single incomes don't work very well near my office.
I would hate to live in a world where I don’t regularly meet with coworkers face-to-face. Remote communication just isn’t the same, you lose a lot of signal and are more compartmentalized from each other. I’m saying that as an introvert.
But I also have a short commute and a nice office.
At my last company I was officially in-office but I basically never went in because essentially everyone I worked with was in a different office or even a different country.
IMO the downside of being that spread out is the infrastructure. Cities subsidize the suburban infrastructure because of the population density benefits. If everyone spreads out then infrastructure will suffer.
Do cities actually subsidize suburban infrastructure? I am skeptical but I don’t know all of the details on how people come to that conclusion. What happens if the economy is more spread out? Also a lot of the people that own and run companies that give a city its tax base live in the suburban areas. It might even be reasonable to say that they are the ones subsidizing the city and not the other way. How do you think about these angles?
It's not like cities give their money to every suburban mom. It's like this:
Suburbs cannot function without freeways, but the presence of freeways harm the property values of city neighborhoods not suburban ones.
SFH simply produces less tax revenue than an entire apartment building by land, so any statewide social services (education, freeway maintenance...) is paid proportionately more by cities than by SFH.
There are reports[0] of cities reporting that their SFH actually loses them money due to the fact they simply don't pay their fair share of taxes vs all the infrastructure they use.
It's not like the government is going "oh boy, SFH mom, here's 500$ plucked straight from some inner city mom's payroll taxes". But in the broader system of supporting many people's living styles through greater societal infrastructure, less-dense housing like suburbs do not put out as much as they take.
This feels more like a planning/governance problem than an innate property.
I've lived in SFH on the edge of a major city and on the edge of farmland and there's a wide gulf in the level of infrastructure that they had access to, and also a significant difference in the amount of tax that was owed. It's hard for me to believe that those two very different scenarios are functionally equivalent.
Moreover, vast swathes of the city I used to live next to, despite having significantly higher tax rates, were ultimately paying a lot less in tax due to severely depressed income levels and property values. There might have been a higher mean revenue per acre in the city as a whole, but there also was a much higher variance.
It is simple enough to break it down by area. If a city has N people per city block, but a suburb has 1/N people per city block you lose out on all economies of scale. Each individual dwelling requires water, electrical, gas, roads, etc. More efficient to amortize that across more people per unit of infrastructure. A road is always going up cost $/foot. Best if that road is being used by 100k people per day instead of 10.
Yes but that’s a cost of infrastructure angle, not an argument for who is subsidizing whom. I’m saying the fact that the economy is unnecessarily focused into cities makes suburbs look worse in tax revenue but it doesn’t have to be that way.
You cannot ignore infrastructure costs and then ask who is subsidizing whom. Infrastructure is an enormous governmental expense. Not just the initial installation, but the ongoing maintenance as well. Economies of scale are always going to result in the higher density installation being more cost effective.
Suburbs in general are losers from a government operations perspective.
They work because they are mostly newish. Core functions like keeping roads functional rely on state and federal aid.
Many older suburbs are more in decline now. Especially in 2nd/3rd tier metro areas. It’s just less obvious than the inner city or rural areas. They need growth to thrive. Once they fill out, population ages out, schools decline, and a vicious cycle starts.
Money policy has kept that going by organizing the economy around real estate. I don’t think it’s sustainable to continually recapitalize single family homes.
Suburban infrastructure is usually much more sparse, of lower quality and a lot of it is shifted to the local business/homeowner.
As an example - city water vs Water wells & Septic tank/fields. Gravel roads without sidewalks, etc.
So it's not 100% evident that cities subsidize rural counties. Cities do provide the larger tax base for states, which probably subsidize more rural counties through incentives tied to certain rural activities, but making a blanket statement is probably not accurate.
Towns and counties produce revenue from property tax and sales tax.
The infrastructure relies on state support, which is usually from Federal funds and personal income tax. That aid is a transfer payment from cities to localities. Bigger states, bigger transfer. Also, the federal funds are sourced from bigger states to the smaller states.
Thats one of the amazing things about the US. The wealth of the coasts ensured that the smaller states weren’t left behind.
Because they don't simply want you to perform tasks. They want to assimilate your mind and make it fully committed to a corporate cult. They can best accomplish this by having you spending most of your wake time in their corp kingdom.
Having been there: it's not that. It's that, unfortunately, they have enough hard numbers to know most people do their best work with a boss physically breathing down their neck.
I knew some folks at Google who worked 100% remote and only came into the office for critical meetings about once a month. They had proven they could operate that way with a more-or-less stellar track record.
> It's that, unfortunately, they have enough hard numbers to know most people do their best work with a boss physically breathing down their neck.
While the conclusion — that most people do their best work when in the office — may be correct, why do you think that the cause of that is the boss breathing down people's necks rather than, say, more efficient collaboration among team members?
My personal observations of my team over the past couple of years are that people are much more engaged, issues get resolved much quicker, and information radiates much better when team members are co-located. This is something that many were in agreement on before covid.
It may be more efficient collaboration among team members. The end-result is the same: more output for the same cost if people are congregating.
> This is something that many were in agreement on before covid
This is an excellent observation worth highlighting: Google's belief stems not just from pre-COVID / post-COVID observation but from the relative output of teams that were same-office colocated vs. inter-office located, necessitating videoconferencing, chat, and email to get work done. Now that you highlight that, I think my reasoning is in error and it's probably more about collaboration being easier in-person. But inconveniently for those who don't want to work in person, the end-result is the same.
Not to mention how body language helps resolve so much surrounding tone when saying something in person. Telling someone to do a thing face-to-face can easily be neutrally charged. The same sentiment expressed in text can carry more weight - feel like an order and appear as if it is more urgent leading to stress
