Traditionally, living in a major city came with a higher cost of living, but it also provided greater job opportunities and better wages to compensate. However, the pandemic significantly disrupted this dynamic. As remote work became widespread, many professionals left expensive urban centres for more affordable locations, seeking a better quality of life. This shift led to rising demand in smaller cities and suburban areas, driving up housing costs and other living expenses. At the same time, businesses had to adjust wages in response to shifting labour markets, leading to an overall increase in salaries in regions that were previously more affordable.

As a result, the wage gap between different parts of the same country has narrowed compared to pre-pandemic levels. Remote work remains a strong trend, enabling workers to live in areas with lower costs while still earning competitive salaries. A notable example of this shift can be seen in the United States, where cities like Austin and Nashville have experienced surging populations and rising costs, closing the gap with historically more expensive locations like New York and San Francisco. If remote work continues to be the norm, this trend may persist, fundamentally reshaping the relationship between location, wages, and the cost of living.