Why remote work has staying power
Taiyou Nomachi | Digitalvision | Getty Images
Remote work, a trend that sprang to prominence during the Covid-19 pandemic, appears to be an entrenched fixture of the U.S. labor market, according to economists.
The work-from-home revolution is “one of the major shifts in the U.S. labor market in the last couple decades,” said Nick Bunker, economic research director for North America at job site Indeed.
“It’s still kicking,” he said. “It’ll probably be around for a long time.”
The remote work label includes workers who do their jobs from home full time and so-called “hybrid” arrangements, whereby businesses might ask employees to work a few days of the workweek from the office and the rest from home.
Such arrangements were rare before the pandemic, economists said.
However, they became prolific amid stay-at-home orders during the early days of the pandemic.
While remote work opportunities have waned from their peak, they appear to have stabilized well above their pre-pandemic levels, economists said.
The number of days worked from home during the workweek has held steady since early 2023 at between 25% and 30%, more than triple the pre-Covid rate, according to WFH Research data as of July.
The share of online job listings that advertise for remote or hybrid work also appears to have leveled off at just below 8%, about three times higher than in 2019, according to Indeed data as of June 30.
“Remote work is not going away,” Nick Bloom, an economics professor at Stanford University who studies workplace management practices, recently told CNBC.
Why remote work has endured
Remote work has endured largely because it benefits both workers and employers, economists said.
For example, Bloom’s research suggests workers value hybrid work about as much as they would an 8% raise.
“It matters a lot, to a lot of job seekers,” making it difficult for employers to “wrench away” that aspect of work, Bunker said.
More from Personal Finance:
How EVs and gasoline cars compare on total cost
Why free school lunches for all may become a campaign issue
The federal minimum wage has been $7.25 for 15 years
Remote work is also a profitable arrangement for businesses, economists said.
For example, they might save money on real estate by downsizing their office space. Remote work also opens up the pool of potential candidates during hiring, Bunker said.
Workers who can work remotely also tend to quit less frequently because they value the arrangement, thereby reducing company outlays on hiring, recruitment and training, Bloom said.
Of course, not all jobs can be done from home. About 36% of employees with jobs that could be done remotely were instead working in the office full time as of July, according to WFH Research.
Companies have pointed to downsides of remote work, including a reduced ability to observe and monitor employees and reduced peer mentoring, cited by 45% and 42% of employers, respectively, according to a 2023 ZipRecruiter survey.
An economic downturn could potentially trigger employers to pull back on remote work, to the extent workers lose leverage, Bunker said.
However, he questions whether many would do so, given the aforementioned financial benefits of remote work. Additionally, such a move would likely reduce morale and worker productivity during a period of already-low morale, he added.
