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January 24, 2008

Work/Life: NYC Versus Kentucky—One Resists Flexibility, the Other Embraces It. Who Wins?

First, let’s establish that the horses have been let out of the “flexibility barn.” Whether we like it or not, flexibility is fundamentally reshaping how and where we live and work. Yet, while some communities are choosing to embrace and leverage this new flexible reality to fuel growth, others are surprisingly resistant. Case in point would be the contrast between New York City and Kentucky.

According to the New York Times, New York double taxes non-residents with jobs in New York City, but who work from home in other states. This is common since people can live in New Jersey, Connecticut or Pennsylvania and still work in New York.

It turns out that many people have challenged this rule. Senators Chris Dodd and Joe Lieberman (both from Connecticut) have introduced the “Telecommuter Tax Fairness Act” which would ban states from taxing non-resident telecommuters. But there is fierce resistance from New York officials. They argue that it’s unfair for people who choose to live and work in New York to pay more taxes if they work from home than a colleague who lives in New Jersey. And they fear that jobs might disappear if telecommuting spreads too quickly. Sky-high commercial rents will fall and the merchants who support all of those commuters will suffer.

Okay, fair enough. But at the same time, New York City officials are grappling with congestion that they say “shaves up to $4 billion a year off of region’s economy and as a result 52,000 jobs are not created,” a problem that flexibility could help solve. So which is it?

Contrast New York’s active resistance with that of the State of Kentucky. Not only is Kentucky embracing flexibility and innovation but sees it as a key lever for future growth and development. Business and community leaders from across the state, and within cities such as Lexington, are working with the Institute for Workplace Innovation at the University of Kentucky and its director, Dr. Jennifer Swanberg, as well as the University’s President, Lee T. Todd, Jr. to achieve their collective vision.

According to President Todd, “I envision Kentucky as a state of choice, a place where employers want to locate and employees want to work…Becoming a leader in workplace innovation is imperative for the growth and development of our economy.” (To read more about Kentucky’s initiative and what Kentucky employers are already doing download the Institute for Workplace Innovation’s “Making Workplaces Work—Employer Best Practices in Kentucky, 2007” publication.)

There is no turning back the tide of flexibility. Technology is here to stay. Companies are only going to become more global, and talent is only going to be more discerning in where and when they work. Which communities are going to ultimately survive and thrive? Will it be New York City that steadfastly guards an out-dated rule that punishes telecommuters. Or will it be states like Kentucky, and cities like Lexington and Houston that are actively creating new innovative models of work? What do you think?

Posted by Cali Williams Yost at January 24, 2008 12:24 PM | Topic: work/life | 3 Comments