A cost-of-living crisis is unfolding in U.S. major cities. Inflation data shows that costs for items such as rent and groceries are increasing quickly across the Sun Belt and coastal superstar cities. Now years removed from the darkest days of the pandemic, people are asking: Is a return to the city worth it? Metropolitan regions have sprawled in recent years, raising budget concerns and quality-of-life issues for the people who remain downtown. Meanwhile the absence of commuters is slowing the recovery in leisure and hospitality.

Many renters believe that a cost-of-living crisis is brewing in America’s major cities.

New York City is showing up as a hotspot of rent inflation. The average rent for 1-bedroom apartments in Manhattan rose to $3,995 a month in May 2022 — a 41% increase from one year ago, according to Zumper.

Sudden, double-digit rent spikes are hitting other hubs, including Chicago, Los Angeles, and Austin, Texas. Zumper data shows that growth is particularly strong in Sun Belt cities such as Miami, where rents have risen to $2,700 a month in May 2022, a 64% increase from a year prior.

During the pandemic, workers left the largest U.S. cities. Two years in, renters have returned but many commuters haven’t as companies negotiate the particulars of a return to the office. Public officials are concerned about lagging transit ridership in cities such as New York.

Ed Glaeser, an economist at Harvard University, says cities are becoming more important — not less — in the age of remote work. “When you Zoom to work, you miss the opportunity to watch the people who are older, to watch what they’ve done and to learn from them,” he told CNBC in an interview.

But for renters, a return to increasingly expensive cities might seem like a raw deal, especially if they can do their jobs from home.

Researchers say remote work limits firms’ ability to train new workers. Data produced by Microsoft’s workforce suggests that it is more difficult to share in-depth information remotely, which can produce silos within companies’ rank and file.

“A lot of these tech companies, they’re saying you can work remotely,” said Andra Ghent, a professor of finance at the University of Utah. “But, you know, in many cases, they’re also saying, like, we’re not going to pay you quite the same amount.”

Many renters believe that a cost-of-living crisis is brewing in America’s major cities.

New York City is showing up as a hotspot of rent inflation. The average rent for 1-bedroom apartments in Manhattan rose to $3,995 a month in May 2022 — a 41% increase from one year ago, according to Zumper.

Sudden, double-digit rent spikes are hitting other hubs, including Chicago, Los Angeles, and Austin, Texas. Zumper data shows that growth is particularly strong in Sun Belt cities such as Miami, where rents have risen to $2,700 a month in May 2022, a 64% increase from a year prior.

During the pandemic, workers left the largest U.S. cities. Two years in, renters have returned but many commuters haven’t as companies negotiate the particulars of a return to the office. Public officials are concerned about lagging transit ridership in cities such as New York.

Ed Glaeser, an economist at Harvard University, says cities are becoming more important — not less — in the age of remote work. “When you Zoom to work, you miss the opportunity to watch the people who are older, to watch what they’ve done and to learn from them,” he told CNBC in an interview.

But for renters, a return to increasingly expensive cities might seem like a raw deal, especially if they can do their jobs from home.

Researchers say remote work limits firms’ ability to train new workers. Data produced by Microsoft’s workforce suggests that it is more difficult to share in-depth information remotely, which can produce silos within companies’ rank and file.

“A lot of these tech companies, they’re saying you can work remotely,” said Andra Ghent, a professor of finance at the University of Utah. “But, you know, in many cases, they’re also saying, like, we’re not going to pay you quite the same amount.”

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Should Workers Return To Major U.S. Cities?

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42 Responses

  1. Very detailed video!! I'm glad I stumbled upon it. I'm aware of vast information on YouTube, that's why I came here hoping to get my question answered; How do I grow my money without losing it?

  2. This video does not make a strong case for cities. None of the guest speakers appear to relate to the struggles of average people living in large cities, or the reasons why many of them would rather leave than stay when giving the option.

    With that said, as I read through the comments, we also need to be weary of our own subjective opinions. There is real material harm in vilifying cities. Especially, when the city becomes synonymous with everything and everyone we think is wrong with society. Cities, I feel aren’t something to be good or bad. Cities have a lot of strengths, and do a lot of things right. The focal point I think should not be trying to spin all of the negatives of living in cities into positives, to attract young people and businesses to move there, nor should it be cities are bad, filled with bad, desperate people. It should instead be how do we modernize our cities, to get them to adapt, to the changing lifestyle preferences of Americans.

  3. This video is not making a good case for NYC….

    The scrappier firms will embrace remote work, not the other way around. Sad video with ppl clinging to the old world.

  4. I actually predict that with remote and hybrid work, once the pandemic is fully over, I can see young ppl flock back to urban areas. Ppl with jobs in New York and DC, I could see them go for Philly and others go for Chicago as both are also real cities.

  5. And what happens to those former workers who spent the majority of their career scraping by in NYC and now find themselves on fixed incomes in a hyperinflation economy? In my early 30s while in NYC on an extended business trip (the 80s) two moments always stuck with me:
    1) One weekend morning I saw a very frail woman in her 80s pushing a cart (for leverage and to shop). She looked incredibly unsteady and uncomfortable. I thought to myself, she probably never thought this would be how she managed later in life.
    2) During the week I was walking from a meeting in Midtown and an elderly couple (well dressed) was in front of me and slowed down. The man moved forward but the woman stopped looked back and beckoned me. Thinking she was going to ask for directions, I was shocked when she asked could I spare some money to help them out. My heart sank and I never looked at NYC in the same light.

    Eyes wide opened, I now saw seemingly well dressed people roaming through trash cans and experienced mentally ill (lost and unwell) people on the subways. I noticed how many subway stops are unfriendly to the elderly and those with mobility issues.

    The final straw was on early Sunday morning to get the newspaper and walked through Grand Central Station. In a closed restaurant I glanced over and saw a rat on the counter as big as an adult cat. At that time I realized NYC requires a person to accept what many feel is unacceptable and inhuman. I was so glad to get home to a somewhat boring by normal small city. Don't be fooled!!! The people at the top in NYC use you up and toss you in the scrap heap when you are done. The 'Working Girl' movie success story is a myth at best and propaganda at worst.

  6. Sounds like literally the only benefit of living in a big city is more young people. But even then, will your "market of young people" really be that much worse in a smaller city like Pittsburgh or Raleigh than in stupid-expensive NY, Chicago, or California?

  7. Forcing you to hustle… Is the exact reason people are cool staying away from cities.

    No matter how much propoganda these guys plush if there is one good thing that has happened to humanity during covid that would be that humans have learnt being humans and felt how nurturing relations means..

  8. it's funny how they shoot themselves in the foot(lockdown) then they expose their own hypocrisy and trust about the society(inflation) then ask for forgiveness because of their stupidity (bailout) which they will get because they lobbied so much money and they greased so many hands to stay on top(oligarchy)

  9. The only people who want people to get back into the city are those real estate agents. And people who can't employ people to work remotely because it would be buying more laptops and hardware for everybody.

  10. Dirty, noisy, crowded, traffic jams, difficult parking,high crime, pollution, … Expensive housing, expensive utilities, expensive parking, expensive services, expensive food. Rude-belligerent- brash-crude-population etc… need more reason…

  11. Coming from Philly, living in BIG cities imo are OVERRATED. The traffic, the lack of space, people living on top of each other. bad schools, crime. For what?? Access to a museum or two?? A couple of diverse restaurants?? Yeah I'll pass. The peace of mind you sacrifice isn't worth it. I say use the city for its opportunity but LIVE outside of it.

  12. I don't want to go back to the office because I don't want to die or get robbed/beat up. I also grew accustom to having my own bathroom.

  13. rather move off grid you destroyed society with wokisms & political theater to push agendas that destroy the economy, as we are in the worst inflation in 40 years over 2 years after the pandemic from own political doing to please certain bases.

  14. White collar pencil pushers who work downtown but live 45 minutes away in the suburbs are the reason every city has hell on earth traffic from 3:006:00. Give them a laptop and keep them off the roads.

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