Remote Work Is Impacting The US Economy

A research paper by Oxford University Press found that the pandemic induced an increase in the productivity of those working from home.

This change constantly affects the US economy. It has increased housing prices, reduced office rent costs, and will permanently increase income inequality.

Remote work will also change where people live within a metro area.

“This shift to working from home is likely the key driver of the large gap between goods and services consumption,” the study found.

Real goods consumption was already growing more quickly in the pre-pandemic years and is now about 7% above the trend.

This contrasts with real services consumption which is still about 1% below trend.

Credit card data shows that remote workers spend less on office-adjacent services such as transportation and more on home office and recreation goods.

This suggests that much of the shift in consumption patterns is likely to last.

Remote work has declined from its levels during the pandemic but is still four times as prevalent as it was in 2019.

Studies have shown that remote work tends to be clustered in certain industries. Tech leads industries with the highest percentage of remote workers, with one of two job postings.

However, financial and professional services and utilities are also large employers of the remote workforce.

Remote work tends to be dominated by higher-educated employees, with 40% holding advanced degrees.

At the other end of the spectrum are workers in the manufacturing or service sector. Those jobs where an onsite presence is needed.

LinkedIn’s Global State of Remote and Hybrid Work found that the peak in remote job posts was in April 2022. The share of job postings that offered remote work reached 20.3%. 

Now, with harsh RTO policies, the LinkedIn study says the remote work rate is closer to 9% or 10%. 

While the percentage of jobs that are fully remote is around 10%, applications for remote positions accounted for 45% of those received in December.

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