The pandemic scramble to legalize home-based businesses

By M. Nolan Gray, Bloomberg CityLab, January 31, 2022

“In the first year of the pandemic, half of all full-time workers — and more than 70 percent of white-collar professionals — went fully or partially remote in the U.S., and many are saying they may never return to the office. And for all the economic tumult it’s caused, the pandemic has triggered a surge of entrepreneurship — much of it quietly taking place at home.

“Of course, cottage industries didn’t suddenly appear with the onset of Covid-19. As early as 1992, more than half of all firms operated exclusively out of a home.

“But as many entrepreneurs have discovered, U.S. zoning codes regularly subject home-based businesses to unworkable standards, if they don’t ban them altogether.

“It’s a broken system, and one that especially disfavors the women and people of color, who — often excluded from traditional labor markets and access to capital — disproportionately run home-based businesses.

“The good news is, with working from home going mainstream, that has started to change. In mid-2021, Florida policymakers engaged in some state preemption and passed a bill requiring that all municipalities allow home-based business in residential zones. … Similar bills have already been introduced in states like New Jersey and Oklahoma, with more states sure to follow.

“It’s easy to write off the plight of the home-based business as a minor issue. But more often than you might think, they mature into the kinds of traditional brick-and-mortar businesses so desperately needed to fill the vacant storefronts plaguing many U.S. cities. 

“Beyond the economic activity they generate, home-based businesses call into question a zoning system that assumes that different parts of our lives must play out in different places. It’s a planning paradigm that has turned the American city into a segregated and unwalkable mess of office parks, strip malls, and residential subdivisions.”

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