It has been a brutal summer in North America—a pattern of extreme weather and disasters. A as climate change amplifies floods, storms, heat, and drought.
There’s little individuals can do to change this pattern, but we can take pride that we are part of an industry that can. I wrote before that we should add reduced carbon emissions as a benefit (or driver) or working from home (WFH). Clearly, online meetings reduce travel, sometimes across town and sometimes around the world. There are also numerous success stories of improved efficiencies from IoT and CPaaS, such as tracking energy consumption to reduce power waste and managing vehicle fleets to reduce fuel use.
But WFH doesn’t work for every employee or organization. We are seeing ongoing conflicts between the WFH and return-to-the-office (RTO) camps. The RTO argument centers around improved productivity. However, many employers don’t buy it and want employees back for better ideation, supervision, and cultural propagation.
Some employers, such as Twitter, insist that “the office is not optional.” While many others are trying to find that magical sweet spot (suite spot?) of compromise. For example, Meta is requiring employees return to the office three days/week, Zoom insists on two days/week, and Smuckers thinks six days/month is the right recipe. RTO mandates are the stick, but there’s also the tried and true carrot approach, also known as magnets intended to attract employees back. RTO magnets include free lunches, massages, and barista-served coffees.
The RTO-WFO debates are a bit like rearranging the deck chairs in the context of our planet becoming a dangerous place to live. Where we work isn’t just a matter of convenience; it’s also an issue of safety. We are seeing a steady stream of destruction and devastation due to weather-related events. The northern hemisphere is ending its hottest summer on record, and extreme weather is not showing any signs of abating. As these conditions persist, our priorities and values will change, and that includes our views of work. This could result with bringing back some old ideas like the company town.
The Modern Company Town
As I’ve shared this idea with others, I’ve learned that many people have a visceral reaction to the term “company town.” These notorious communities initially popped up in America during the Industrial Revolution. Many of them had exploitative labor practices comparable to prison camps.
Company towns were often located in remote places for proximity to natural resources or cheaper land. These places didn’t have access to labor, so the employers built housing. This was before labor unions, OSHA, and the rise of labor rights in general. Rampant abuses took place, and company towns rightfully disappeared. However, some evolved and still exist. Hershey, PA; Pullman, IL, and Corning, NY all have roots as company towns.
Even more surprising, modern company towns are being built. Google is building neighborhoods with employee housing near its Mountain View headquarters. Facebook is working with real-estate developers to create a mixed-use neighborhood called Willow Village near its Menlo Park headquarters. Willow Village will have 1729 apartments, bike lanes, a pharmacy, cafes, and a 1.25 million-square-foot office building. Elon Musk is building a “multi”-company town in Texas. 6,000 acres outside of Austin are being developed with facilities and housing for Tesla, SpaceX, and Boring.
By living where we work, company towns could be an interesting twist to the RTO-WFH debate. Those corporate communities would be like those billboards along the highway that say, “You’d be home now if you lived here” -- but without the highway.
Company Towns + A Changing Climate
It occurs to me that a modern company town, built for a warmer climate, could be a very powerful magnet that draws employees in the same way that health insurance and other benefits draw talent.
We cannot predict or avoid extreme weather, but we can mitigate its impacts with better construction. By combining work and home, the justification for improved weatherization becomes easier. We can’t out-engineer Mother Nature, but we can build better homes, offices, and communities that are designed to withstand more severe conditions.
If employers really want their employees nearby, why not build a community which makes that option attractive? Employers have a clear incentive: extreme weather is impacting the productivity and safety of employees, and employers have a vested interest in their employees being safe and protected.
It’s obvious that the hot weather affects outdoor workers, such as construction and farm workers. But extreme heat hits the productivity of indoor workers too. We slow down, become more irritable, and are more prone to error when uncomfortably hot. We also become concerned about our family members and pets.
Most workers in industrial societies are indoor workers, but that doesn’t mean they have air-conditioning. Many factories in the U.S. are not air-conditioned because they were built more than 30 years ago. AC was not as prevalent back then, and frankly, it didn’t get as hot for as long back then either. 100+ degree indoor factory conditions were common in the Midwest this summer.
Phoenix, AZ, saw scorching 110-degree highs for nearly 30 days in a row. El Paso, Texas, temperatures were more than 100 degrees for 43 straight days. Maricopa County in Arizona reported 89 heat-related deaths this summer; another 350 deaths are still being classified.
Over 100 million Americans were under excessive heat alerts last month. At least nine prison inmates have died since the relentless heatwave has gripped Texas. A recent report estimates that this summer’s extreme heat will result in $1 billion in healthcare-related costs in the United States. New heat records don’t seem to stand for very long anymore.
Many companies are making carbon-reducing commitments, but in a distributed work world, these commitments should include the HVAC in their remote workers' homes. The answer to a hot day today is AC. The answer tomorrow may be AC and a generator. Factor in other concerns, such as fire and flood protection, and the cost of housing really increases. That’s on top of housing costs that are already extremely high.
There could be any number of motivations causing Meta, Google, and Musk to build modern company towns. I’d like to think that employee wellbeing is among them. These employers, and many others, have already integrated many other magnets into their benefits packages. Climate-fortified housing could be the next progression. That probably involves thicker walls, better drainage, construction with nonflammable materials, and robust underground utilities.
A Complex Choice
The answer to "Where will I choose to live?" is complex and involves many considerations, including income, relatives, real-estate prices, schools, and friends. A modern company-town approach certainly won’t work for everyone. but there are few company benefits that appeal to all employees.
Employers are struggling to find the right mix of pay, benefits, and amenities to attract and retain employees. Considering that housing is typically the most significant cost in household budgets, there’s room to work with here.
It could prove to be a win-win situation. The employee benefits from better protection and peace of mind. The employer gains some weather insurance for its workforce. Employers like to think their benefits package is attractive; and this is one more lever – medical insurance, retirement contributions, education, …, and housing.
It’s not a perfect solution. Employers become landlords, and employee homes become tied to a job, but these trade-offs are not necessarily new. Universities exist to educate, but many offer dormitories and apartments to facilitate the experience. The federal government often offers housing to its employees at national parks. As mentioned above, Meta, Google, and Musk are already moving toward becoming landlords.
The threat of having to move if there’s a job change isn’t new either. Many employees select housing based on their job, and would move if their employment changed. It could be that their job is the only reason they live in a particular location, or perhaps they have a work visa that requires them to move should their employment terminate.
Housing is indeed complicated. I am not suggesting the company town is a solution for everyone — probably not even most employees. I do see it as a natural progression to the RTO efforts. There are clearly benefits to a reduced or eliminated commute, and it seems inevitable that those benefits can and should include climate concerns. All employees need housing, even if they view climate change as a hoax.
Regardless of why, company towns are returning. Assuming they will be built for a harsher climate is not a big leap. If it works as a magnet, then a trend will be born. Smaller companies that can’t build their own towns might gravitate toward communities that develop ruggedized, mixed-use areas.
There’s also a bit of ironic justice to this concept. What if company towns become so desirable that they are deemed the ultimate benefit? An ideal, subsidized safe haven for employees. It would be beautiful if a new generation finds it difficult to fathom that company towns were once associated with despicable conditions and strife.
Dave Michels is a contributing editor and analyst at TalkingPointz.
