Shift Away from Major Tech Hubs: Companies with "work from anywhere" policies increased hiring outside the top 5 U.S. tech hubs (SF Bay Area, NY, Washington, LA, Seattle) from 50% pre-pandemic to over 60% since 2021.
No Office Presence Hiring: 60% of new hires are located in cities without a company office presence, up from 40-45% pre-pandemic.
Emerging Tech Hotspots: New tech worker hubs include Salt Lake City, Boston, San Diego, and Denver, each accounting for 2% of hires.
Attrition Improvements: Companies adopting "work from anywhere" policies reduced attrition rates from 12% pre-pandemic to 7% in 2022, aligning with the broader industry average.
Global Workforce Trends: North American employees decreased from 75% to 67% of the workforce for "work from anywhere" companies, while employees in Asia tripled from 3% to 10%
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The COVID-19 crisis unlocked a paradigm shift in how organizations think about flexible working. A post-pandemic gold rush ensued as firms enacted sweeping ‘all remote’ policies to capitalize on clear benefits to employee wellbeing and reductions in capital expenditure. However, a backlash has occurred at major firms in recent months following concerns over the impact on long-term productivity and team connectivity.
Yet many organizations continue to go all-in, ditching hybrid models in favor of fully remote options for all, and are starting to reap the benefits of access to much wider talent pools. The question remains how firms will converge on balancing these competing pressures and to what extent a true “work from anywhere” model will materialize in the talent marketplace.
Aura job posting data shows a surge in adverts for “remote” positions in US tech firms at the onset of the pandemic in March 2020, rising steadily to a peak of 41% in July 2022. The past year saw a relative decline in remote postings, however, reaching 31% in July 2023, with high-profile tech companies such as Google and Meta ending fully remote options as part of a partial ‘return to office’ policy.
In contrast, many smaller companies have been encouraged by clear evidence of the benefits to the employee value proposition, savings on physical office space, and access to a much larger pool of talent, choosing instead to embrace remote working as a permanent fixture. With remote postings 3x higher than the pre-pandemic norm of ~10%, the distributed working model will likely stay here.
Companies are reaping the benefits of a decentralized workforce, but a true “work from anywhere” model will take time to materialize.
Flexible working models take many forms. Many firms are opting for a hybrid or “hub and spoke” model, requiring employees to live within commuting distance of an office location to allow a few visits each week. Others have recognized the benefits of a “work from anywhere” model, allowing employees to live and work from any location, and employers to source talent wherever they can find it.
Aura analyzed data from 6 US-focused software companies adopting “work from anywhere” policies since the pandemic (Ancestry.com, Atlassian, TaskRabbit, Dropbox, Slack, Square) revealing a gradual hiring shift away from the top 5 N.American tech hubs (SF Bay Area, NY, Washington, LA, Seattle). ~50% of pre-pandemic hires were from outside of these cities, rising to >60% since 2021, suggesting these firms are starting to tap into a much wider pool of talent.
However, a full ‘work from anywhere’ model has yet to materialize, with the proportion of hires in Aura data located outside of major tech hubs remaining stable at ~60% since 2021.
Changes in hiring practices are allowing these firms to achieve a more distributed workforce vs the wider US tech industry, which sources only 45% of its staff outside of the major hubs.
Yet there is still room to decentralize further. Companies such as Gitlab, which has been deploying an " all-remote" model since its inception, have been able to achieve much more distributed workforces¹, with 80% of employees located outside of major tech hubs.
¹Ancestry.com remains an exception to this group, with a large proportion of its workforce located near its HQ in Lehi, Utah
A more distributed workforce doesn’t need to mean more office locations. Hiring data from 5 US-focused software firms shows that an increasing share (~60%) of new employees are located in cities with no physical office presence at all vs. 40-45% pre-pandemic.
Workers are starting to take advantage of “work from anywhere” policies to live where they please, and employers can now tap into larger talent pools without the requirement of setting up new office spaces.
These workers are particularly likely work in software engineering roles, taking up the top 2 job titles for employees working away from company office locations, at a combined total of 16%.
"Work from anywhere" policies are also enabling the emergence of new tech hotspots. While some remote workers will inevitably come from existing major hubs where firms haven't chosen to place an office (LA, NY), large numbers of workers are locating in much smaller cities such as Salt Lake City (2%), Boston (2%), San Diego (2%), and Denver (2%).
Aura attrition data suggests that firms implementing post-pandemic “work from anywhere” policies might attract more committed and longer-serving workers. Whilst these companies suffered from historically higher attrition rates than comparably-sized (<$20Bn) US tech companies, with a 2017-19 average of 12% vs 10%, attrition data from 2022 shows that these firms have brought employee attrition in-line with the larger industry at 7% since introducing these policies.
A spike in turnover in 2021 to 12% suggests that transitioning to fully remote work can be difficult. However, time will tell how successful this model will be in convincing distant workers to remain committed and loyal in 2023 and beyond.
The first wave of remote working following the pandemic saw workers relocate to new locations within their home countries. Even employers with full “work from anywhere” policies often require staff to remain within the same country as a company home office for most of the year.
However, these firms are slowly moving towards a more geographically distributed model. The proportion of the workforce from our Aura’s group of “work from anywhere” companies within North America fell from 75% to 67% in three years. Workers in Asia rose particularly sharply, more than tripling from 3% to 10% since 2017.
Given the domestic shift already happening in the US and the clear benefits of a distributed model to workers and employers alike, perhaps it is only a matter of time before a genuinely global “work from anywhere” model emerges.
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