Low cost of living, remote work make Southwest Virginia attractive

For Southwest Virginia, it’s getting a little better all the time.

Rising housing prices in metropolitan areas and continuing post-pandemic remote work options are slowly changing Southwest Virginia’s economic and demographic fortunes, a report from the University of Virginia’s Weldon Cooper Center for Public Service shows.

Hamilton Lombard, a demographer for the Weldon Cooper Center and the report’s author, says more businesses are opening in Southwest Virginia than Northern Virginia as more remote workers move into the area. (Photo by Mitch Powers, University Communications)

Although the region still has an older and declining population, with more deaths than births, new residents are migrating into the area as housing prices in Tennessee and parts of Virginia increase and employers accept hybrid remote work arrangements.

“This has historically been the poorest part of Virginia, the area with some of the most negative population trends,” said Hamilton Lombard, the Cooper Center demographer who wrote the report. “For decades, the region was losing thousands of young adults, and we’re seeing that turnaround to where it’s now pulling some in.”

Remote work is one of the big drivers of the change. Data gathered by several national research groups indicates that while companies are bringing workers back to the office, most white-collar workers continue to work remotely, either full time or splitting their time between home and a central office.

“The persistence of remote work has effectively resulted in Southwest Virginia and much of rural Virginia becoming the outer suburbs of the large cities in the mid-Atlantic,” the Weldon Cooper report states.

As a result, regions like Southwest Virginia have become desirable alternatives.

Work locations for U.S. employees with remote-capable jobs

Remote work opportunities, whether full-time or hybrid, continue to give employees more options to live farther away from offices, sparking the migration out of more expensive cities and into rural areas. (Illustration by Mike Cross, University Communications)

“You have metro areas nearby that are growing very rapidly, like Winston-Salem, Salem, Bristol and Knoxville, and prices are rising. Now you have people saying ‘Bristol’s gotten too expensive’ or ‘It’s not as affordable as I want; let me look into Scott County or maybe Wise County,’” Lombard said. “Someone with a high salary from Northern Virginia moving to a place like Abingdon doesn’t just impact the housing market. They’re injecting spending and new business ideas into the community.”

With new business ideas come new businesses. According to the Weldon Cooper report, from 2019 to 2023, Southwest Virginia saw a 70% increase in business applications to the IRS, just behind the Chesapeake Bay region. Northern Virginia’s increase was the smallest in the state.

“Ten years ago, opening a business in Abingdon was far riskier than in Northern Virginia. Now the risk is lower, and the rewards are real,” Lombard said.

Newcomers want affordability, but they also want the hard-to-define concept of quality of life, including culture, recreation and educational opportunities, such as those found at UVA Wise.

“The highest levels of migration have been to places that offer a high quality of life,” the report states. “Since 2020, rural counties with strong natural amenities, such as coastlines or mountains, have seen their (ages) 25-to-44 population grow at twice the national rate.”

That trend, Lombard said, could help explain the interest in Southwest Virginia communities.

Southwest Virginia net domestic migration

Southwest Virginia’s population still skews older and remains on the decline, but new residents are moving in as housing prices in Tennessee and parts of Virginia increase. Those residents are opening businesses and becoming part of communities. (Illustration by Mike Cross, University Communications)

“Southwest Virginia is well-positioned. It has mountains. It has a temperate climate. It’s affordable: a $100,000 salary in Northern Virginia won’t get you much, but in Southwest Virginia, you can live quite well,” Lombard said. “Every place has to compete for its workforce, and a lot of areas are realizing that to bring in jobs, you need to make yourself a place people want to stay or move to.”

While researchers can’t say for sure, Lombard said many of the people moving into Southwest Virginia likely have roots in the region.

“One of the big disadvantages Southwest Virginia has had is that its economy is not based on high tech or a high-skill service industry economy. It’s been more blue-collar. When people who grow up here get a college degree, there are relatively few opportunities, and so they often leave,” Lombard said. 

“We aren’t there with the data to say definitively, but we may be seeing people who once lived in the region who now can work remotely or have a flexible hybrid situation moving back in. Nationally, data is showing this has been happening since the pandemic.” 

UVA’s Weldon Cooper Center for Public Service provides nonpartisan, reliable research and leadership training to individuals and entities that serve the public good. The center staff has expertise in public management, demography, economics and public finance, political science, leadership and organizational development, and survey research.