Teleworking and rural development after the pandemic

Goal and aim

The project’s goal is to investigate the possible role of teleworking for rural development in post-pandemic Sweden. The aims of the project are to study the opportunities and obstacles for teleworking, to study the conditions under which it might contribute to rural development, and to study current and possible policies for using teleworking as a tool for rural development.

Background

Urbanization has been a major trend of the world for the last two centuries. Historically, urbanization has been closely connected to industrialization, and the counterurbanization that the western world experienced in the 1970s, coincided with a severe industrial crisis. From the 1980s and onwards, the knowledge economy’s (and connected service sectors’) expansion are new driving forces of urbanization. In line with the New Economic Geography, agglomeration has become a self-reinforcing force for the growth of city-regions. Cities are growing by forming city-regions, when residential areas and new activities grow outside the city boundaries and extend the functional city. Commuting binds the regional labor market together. So far, this has taken place within the pattern that factory production formed: work at the workplace, leisure at home, and commuting time has been the critical factor for extending the city-region.

The pandemic – and the access to new ICT – has changed this traditional pattern. Closing of workplaces as a response to the pandemic has changed the location of work dramatically. In Sweden, the share of working Internet users that “teleworked” at least once in a while before the pandemic was 23% (Internetstiftelsen 2020), while a survey to a sample of 2055 working individuals in January 2021 showed that 53% of them were teleworking on full or part time (Netigate 2021). Thus, a large part of the work force have been used to work from home or other place. A majority of them want to continue working part time from home, in some survey as much as 70% (Netigate 2021). Most employers have noticed that teleworking works and that organized teleworking would save office costs in the future.

Other effects of the pandemic is that the predominant urban planning paradigm of densification has been questioned and that media is reporting about a new “green wave”, which among other things is reflected in sharp price increases on villas and rural holiday homes, and a net out-migration from Stockholm and net in-migration to certain rural areas. There are, thus, great expectations on a rural renaissance after the pandemic. On the other hand, from an urban economics perspective, it can be argued that the agglomeration benefits of the big city-regions are so strong that the possible green wave soon will peter out.

In the 1980s, in the childhood of the ICT revolution, there were similar hopes for rural expansion. Distance should no longer be a problem and people would be able to live where they wanted. Pilot projects for “Tele-cottages” were started in several rural places, where tele-commuters should share ICT equipment and be connected to their regular workplaces. Due to the at that time insufficient technology level, the tele-cottages never became a success, but part-time telecommuting from home increased slowly but steady, from about 5% of the working population in 1999 to over 20% in 2012 (Vilhelmsson & Thulin 2016). Similarly, entrepreneurship scholars have increasingly acknowledged that the dividing line between activities that are associated with urban and rural entrepreneurship have grown less distinct—as those illustrated by intriguing examples such as ‘urban farmers and rural coders’ (Townsend, D. & Naar. 2019, Hunt et al., in press).

This project is based on the assumption that the pre-pandemic work pattern only partly will be restored and that this opens a certain potential to partly extend the city-regions’ networks to new urban nodes and rural regions. The long-term growth of the mountain village of Åre is an indication of that this network extension of the Stockholm region already has been going on for a while, and an important question is how such extended, cross-regional networks develop and survive over time.

For obvious reasons there is no research published yet on the possible development of hybrid workplaces, their networks and possible effects on rural development after the pandemic. However, in the international literature there are several topics that relate to the subject of this project. In Europe, the COST Action CA18214, The Geography of new Working Spaces and the Impact on the Periphery with 90 participants from 33 countries is running 2019-2023. The Action aims at a) sharing results on coworking in order to: (i) identify a taxonomy of these workspaces, and (ii) map their spatial distribution and location patterns; b) identifying, measuring and evaluating the (direct and indirect) effects of coworking spaces with particular focus on peripheral areas; and c) to collect, discuss and develop guidelines for tailored policy and planning measures. The project leader, Hans Westlund, is the Swedish representative in the COST Action. A book on the effects of the pandemic on coworking spaces in a number of European countries will be published during the summer of 2022.

There are also a number of other topics in the international literature that are of high relevance for this project. Some of these topics are relatively well researched in Sweden, while other are less explored. Topics of special interest for this project are the attractiveness of places (e.g. Kourtit et al. 2021), the role of natural and cultural amenities (Naldi et al. 2021) living preferences (e.g. Niedomysl 2008; Niedomysl & Amcoff 2011a), long-distance rural-urban commuting (e.g. Andersson et al. 2018), migration patterns (e.g. Lundholm 2010, Niedomysl & Amcoff 2011b), and rural entrepreneurship (Hunt et al., in press). Regarding local/rural embeddedness and social capital, there is research on Swedish firms and entrepreneurship (e.g. Baú et al. 2019; Johannisson et al. 2002, Westlund et al. 2014). When it comes to policy issues, there is research on policy entrepreneurship, local entrepreneurial governance and the institutional conditions connected to these activities (Olsson et al. 2015, 2020), which show that Swedish municipalities perform a lot of activities aiming at local development and growth (even though measures for teleworking had not come up on the agenda at the time of research).

Project description

Theory

The trend of urbanization seems irreversible. What happened in the developed world in the 19th and 20th centuries is now happening even faster in the developing world (Farrell 2017). As most people in the developed world already are living in urban areas, the current urbanization there is rather a re-urbanization from small, peripheral urban settlements to larger city-regions (Westlund 2018). Traditionally, urbanization takes place through two different but interrelated processes: spatial densification and spatial expansion.

The focus on the two main forms of urbanization, spatial densification and expansion, has often hidden that there are hybrid forms of urbanization: guest workers that spend most of their time in cities but return to rural areas for certain periods; daily or weekly commuters that work in the city but have their main residence at the countryside, etc. This project is based on the assumption that ICT development increasingly is enabling an additional process of hybrid urbanization, viz. online urbanization through ICT networks, where individuals perform part time of their work on distance (from home or from coworking spaces). During this part of the working time, they participate in meetings, chat with colleagues, etc. online, and during the other part they work at the city office “as usual”. During their leisure they are part of the “air” of the local social life.

Marshall’s (1920, p. 271) famous expression that “the mysteries of trade (…) are as it were in the air” has inspired many current scholars to theorize on the importance of agglomeration economies (see e.g. Glaeser 2010). Duranton’s & Puga’s (2004) presentation of sharing, matching and learning as the main sources of agglomeration benefits, is one of the most influential. Their presentation has become a main explanation to the growth of big cities in the knowledge economy, in which innovation plays a major role. However, several issues following Duranton’s & Puga’s explanation have not become the subject of much discussion:

  1. Agglomeration benefits exist at all levels in the spatial hierarchy, even if they decrease with the size of the agglomeration. Also small places have certain agglomeration benefits.
  2. Agglomerations might not only refer to spots (i.e. places and regions) but also to networks of places and regions; networks that are held together not only by commuting but also by ICT solutions. Access to the agglomeration benefits of networks might be more important than being located in a spot of agglomeration without access to the networks.
  3. Networks of agglomerations improve sharing, matching and learning as long as the benefits exceed the costs of the networks. Smaller places belonging to such networks will to a certain extent be able to “share” or “borrow” agglomeration benefits from the big agglomerations – if the networking agents in these places not only interact with the main urban hub but also with each other and other local actors.

This interpretation of Duranton & Puga might contribute to explaining why the biggest centers do not absorb everything. Besides the usual market equilibrium forces, agglomeration economies operate in places at different levels – and they can be strengthened at lower levels in the urban hierarchy by policy measures, like e.g. establishment of regional university colleges and other measures that increase these places’ integration with the national networks and thereby increases the levels of sharing, matching and learning. In addition, rural areas may provide alternatives to the agglomeration logic “through less stressful environments, palpable social support, collaborative networks, and innovative twists on urban business models” (Hunt et al., in press: 9). Even peripheral and remote regions can develop by attracting mobile work forces (Gottlieb, 1994) and hosting “firms that are highly innovative and competitive” Dubois (2016:1)

However, in order for teleworking to positively influence rural development as much as possible, a number of conditions must be fulfilled:

  • High-quality ICT infrastructure, and functioning transportation infrastructure and public transportation must be available at the networked workplace.
  • Part-time teleworking should not only be accepted, but also supported by the employer. The employer needs a developed strategy for teleworking.
  • The place of living must be attractive for the often highly educated work force in the hybrid agglomerative networks. Natural and cultural amenities as well as commercial leisure offers must correspond with the actors’ living preferences and vice versa.
  • The teleworkers must be “double embedded” in two different environments, both their professional urban, social working environment and their local, social living environment. In the best case, the teleworkers should form a critical mass that can function as mutual support and community. If these double embeddedness/social capital conditions are fulfilled, the actors might function as agents of spread of knowledge and information, and possible also as drivers of new initiatives, which would facilitate local innovation and entrepreneurship.

The four conditions are affected by different institutions and actors of which public policies at different levels play an important role. Transportation and communication infrastructure is mainly a national responsibility, but ICT in rural areas are often provided by local membership associations. Employers’ acceptance and strategies for teleworking are decisive but so are also the employees’ handling of the process. The attractiveness of places is to a certain extent a result of local policy, but also of the activities of local economic and social entrepreneurs. Regarding embedding of teleworkers in local, learning and innovative environments, local governments, together with the teleworkers themselves, are probably the main actors that can take action for initiating such processes.

Project layout and implementation

The project consists of the following work packages (share of projects’ total resources within parenthesis):

WP1. Project set-up, coordination and management (5%). Part of the initial work will be devoted to setting up a longitudinal database to enable the register data analyses described in WP 2 and WP 5 and to link some of the survey collected data in the additional WPs to register data to obtain key contextual indicators. We will use SCBs longitudinal databases that enables us to observe individual characteristics (such as age, gender, level and type of education, industry experience and knowledge characteristics).

WP2. Study of pre-pandemic and post-pandemic patterns in internal migration, commuting over municipality and county borders (10%). This WP will be based on individual and aggregated register data and is performed year 1 (pre-pandemic) and year 4 (post-pandemic) as register data are available with about three years’ lag. Analyses of: a) in-migrants to rural areas after age, education, gender, family, income, earlier experience of the area, etc; b) characteristics of rural places of in-migration: location, accessibility, labor market, public and commercial services, amenities, etc; c) commuters after distance, commuters’ age, education, gender, family, income, etc; d) places of out- and in-commuting after location, commuting distance, commuters’ age, education, gender, income, etc. Comparisons of patterns before and after the pandemic.

WP3. Study of post-pandemic distant workers on “how it works (10%). Selection by Statistics Sweden of possible respondents among commuters over county borders. Survey about teleworking’s contents, its share of total work, distance to regular workplace, teleworking’s location, reasons for teleworking, commuting’s length and means of transportation, employer’s support and arrangements, support and arrangements (from which actors?) in the local community/municipality, What demands do teleworkers have considering arrangements and conditions to make teleworking sustainable in the long run?

WP4. Study of urban workers’ possible (post-pandemic) teleworking (10%). Selection by Statistics Sweden of individuals in professions for which teleworking is possible. Survey on the following questions: Have they been working from home or other place? If so, how much, how long, which regularity? Where has is taken place (location, distance from home, type of workplace)? What is their potential will to move and become teleworkers? What would attract them to move? What would prevent them from moving?

WP5. Study of migrants to rural areas in working age and their activities (10%). Method: Selection of individuals by Statistics Sweden. Survey about reasons for moving, type of working activities (e.g. wage-employment, self-employment), demands on the new place of living regarding e.g. accessibility to services and amenities, things or features that was avoided when searching new place of living, current type of work, distance to work, form of commuting/travel to work, occurrence, possibilities and obstacles for teleworking, etc. For individuals who started a business, questions on the type of business, growth aspirations, ways of maintaining relationships with customers and/or suppliers, and the role of local conditions as enabling and constraining forces in shaping their business.

WP6. Study of teleworkers’ “double embeddedness”, possible support, solidarity and outcomes (15%). Survey combined with the survey of WP3 and WP5, followed up with detailed interviews of selected cases. Which are the decisive factors for embedding teleworkers in the company’s/organization’s joint labor force? Do teleworkers in the local place meet and discuss common problems and experiences? How is this organized? Do coworking spaces exist and if so, are they used? Experiences of them? Interplay between teleworking and work-family balance? Are there differences between women and men (is teleworking a female trap)? Do local embeddedness and collaboration result in any materialization of agglomeration benefits in e.g. the forms of innovations or new firms?

WP7. Study of strategies, projects and activities of municipalities and other local actors to support local attractiveness, in-migration, teleworking and coworking (20%). What do they do? How are local resources and amenities used? How is learning supported and implemented in the processes? What types of collaborations are created and which actors participate? How are problems and obstacles handled? Are there any strategies for not only attracting teleworkers, but also to use their competences and networks for local development? The WP is performed in two steps: first a telephone survey to the municipal directors of all municipalities outside the three metropolitan regions; then more detailed interview studies of about 10 cases based on the results of the first survey.

WP8. Summarizing analyses and results 10%).

WP9. Interactive communication with actors and stakeholders (10%).

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The project started in January 2022 and is currently in its initialization phase.