There's another half of this phenomenon that seems to get ignored. Yes, allowing remote work greatly increases a company's supply of potential employees.
However, if more and more companies offer remote work as an option, that means employees now have a greatly increased supply of companies competing for them as well.
The software engineer living in Ohio who doesn't have the option/ability to move to a tech hub like SF or NYC would've typically had to make due with the small pool of positions available to them locally, meaning less leverage for salary.
If more companies allow remote however, they can now work at any of those, and the local companies will suddenly be forced to compete for talent.
However, if more and more companies offer remote work as an option, that means employees now have a greatly increased supply of companies competing for them as well.
The software engineer living in Ohio who doesn't have the option/ability to move to a tech hub like SF or NYC would've typically had to make due with the small pool of positions available to them locally, meaning less leverage for salary.
If more companies allow remote however, they can now work at any of those, and the local companies will suddenly be forced to compete for talent.