Benefiting from the ‘Zoom boom’
“Pandemic refugees” fleeing big cities in the North and Midwest could turn parts of North Carolina into “Zoom towns,” said demography expert James Johnson of Kenan-Flagler Business School.
James H. Johnson Jr.
North Carolina’s economy may actually benefit in some ways from the coronavirus pandemic, as thousands of urban “pandemic refugees” relocate here, said demography expert James H. Johnson Jr., William Rand Kenan Jr. Distinguished Professor in the Kenan-Flagler Business School.
Johnson recently examined the coronavirus-fueled migration in a Kenan Institute white paper, “Coronavirus Pandemic Refugees and the Future of American Cities.” Thousands of urban dwellers once willing to pay high rent for cramped apartments in exchange for the vibrant social life of the city have moved to North Carolina seeking cheaper, more spacious places to live and often work. “The impact should be very positive” for the state’s economy, Johnson said.
Zoom towns
“Between March 1 and May 1, 400,000 people left New York headed to other places. And North Carolina for the past decade has been a primary destination,” Johnson said. Over the last decade, 150 people per day on average have migrated to North Carolina. In 2017, the average was 194 people per day, 47 of whom were from New York.
“As this pandemic continues and as people strive for social distancing, we’re talking about more space. We’re talking about larger properties, larger homes, particularly for older adults and millennials with children,” Johnson said.
This migration has led to the emergence of “Zoom towns,” vacation destinations that have become attractive as places to live full time, especially for people who can work remotely thanks to technology like Zoom conferencing.
“Most of these Zoom towns are in the West, but I think we’re going to see them also in North Carolina, in rural areas near amenities, lakes and golf courses,” Johnson said.
Homes and furnishings
This growing influx of people increases demand for property, houses and furnishings, a particular advantage for a state known for its furniture and textile industries. “They want a bigger house on a bigger lot and that means more furniture,” Johnson said.
Desk options from Project Objet. (Photo courtesy High Point Market.)
People new to the state aren’t the only ones fueling the demand for furniture, however. The pandemic has created several reasons to get new furniture: equipping a remote office, setting up spaces for children to do schoolwork at home, updating rooms for adult children returning to live with their parents and refurbishing or replacing furniture that’s getting used more often.
Johnson himself is a prime example of the trend. During a Zoom interview, he pointed out the features of his own home office. “Everything in here has been purchased since the pandemic,” said Johnson, who used to be in his office on campus at 6 a.m. every day. “I have a whole set up over here. I even ordered a new chair and put it together.”
The furniture business is booming, setting records for orders for four straight months, according to the latest Furniture Insights survey. Compared to last year, orders were up 30% in June, 39% in July, 51% in August and 43% in September. The High Point Market, the largest furnishings industry trade show in the world, cancelled its April market but returned in October, with exhibitors and customers wearing masks and maintaining physical distance. Exhibitors reported a decrease in foot traffic, according to the High Point Market, but an increase in orders.
Here to stay?
Forecasters like Johnson wonder if the effects of the pandemic will linger. “Is this a long-term trend or, when this is over, are people going to flock back to urban centers?” he asked.
New Yorkers did return to the city they had fled in fear after 9/11, but the pandemic could be different. “If you have any kind of health vulnerability, are you really going to want to go back to sharing elevators and laundry rooms?” he asked. And now that employers have allowed and even encouraged working from home, will people want to return to the office? He doesn’t think so. “I don’t foresee this trend of remote work being fully reversed even when we get a vaccine in place.”
Instead of an anomaly, the pandemic signals a shift that North Carolina can take advantage of. “The only thing the pandemic did was to accelerate a trend that was already underway,” Johnson said. “We need to see this as an opportunity.”
Deepened disparities
Of course, the pandemic has also had devastating effects on other segments of the economy. Commercial clients are suffering from having to shutter shops, restaurants and offices during the pandemic. Hundreds of thousands of North Carolinians remain unemployed, many without health insurance.
Communities of color have been impacted most negatively by the pandemic and its effects. Johnson is studying this side of the issue as a member, appointed by Gov. Roy Cooper, of the Andrea Harris Social, Economic, Environmental, and Health Equity Task Force, which will address the social, environmental, economic and health disparities in communities of color that have been made worse by the COVID-19 pandemic.
One issue that has emerged is the pressing need to expand broadband access throughout the state — not only to keep middle school students from “doing homework in the McDonalds parking lot,” as Johnson said, but also to attract more taxpayers to the state.
“Broadband access is a primary deciding factor where people are going to relocate,” Johnson said. “And I’m hoping North Carolina can continue to be a migratory destination.”
