What It Might Mean If We All Work From Home
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The various measures introduced to tackle the coronavirus that has spread throughout the world has precipitated a widespread adoption of remote work. In Europe, data suggests that remote working has gone from 5% at the start of the year to around 40%.
Earlier this year I wrote about the 5th edition of the Technology at Work report from Oxford University and Citi, which found that over half of the U.S. workforce are in jobs that could continue to be done remotely, even as restrictions ease.
“The COVID-19 pandemic has demonstrated that remote work is possible. We examined 483 occupations and found that 113 of them can be performed remotely,” says Carl Benedikt Frey, Oxford Martin Citi Fellow, and Director of the Future of Work Programme at the Oxford Martin School. “Importantly though, those 113 occupations employ 52% of the U.S. workforce.”
This division is far from equal, however, with EU data suggesting that remote working is most prevalent among highly-skilled workers, while data also shows that there are regional differences, with remote working most common in Scandinavian countries.
Before the pandemic, there were also clear gender divides in terms of remote work, with women typically more enthusiastic about remote working than men. There have also been differences during the pandemic too, with French data showing that women have reported greater mental health challenges during the pandemic, due in large part to the family responsibilities that are still traditionally heaped onto the shoulders of women more than men.
Reluctant to return
As workplaces begin to open again, there has been a call from politicians for people to return to the office. This has been driven in large part by the malaise of city center environments that have become ghost towns without the lifeblood of workers that sustain them. The challenges of city centers have been compounded by the shortage of tourism that would also provide economic heft to so many.
There is an ecosystem of businesses set up around office workers, including gyms, dry cleaners, florists, or food carts. Even larger businesses, such as Uber Eats and Xerox are heavily dependent upon office trade, while the likes of Brooks Brothers have filed for bankruptcy in recent months. Indeed, Starbucks attributed around $2 billion in losses to the desertion of city centers.
Similarly, business travel not only provides a healthy proportion of passenger numbers, but a large proportion of airline profits, not to mention the numerous ancillary businesses, from hotels to conference providers, that rely on professionals getting out and about.
Despite this urging from politicians, however, there is little sign that people are flocking back to the office. Data from the London Underground suggests that passenger numbers are 30% of normal levels, with other forms of public transport across the U.K. operating at around 30-40% of normal levels.
Companies like Google have already said that their employees will be working from home into the summer of 2021, with other technology companies following suit. They have been joined by companies like Ford, REI and JPMorgan Chase, all of whom have announced long-term plans for remote working. Indeed Pinterest has gone as far as paying an $89.5 million dollar contract penalty to walk away from their new city center office building in San Francisco.
“Major organizations have this huge real estate that isn’t being occupied, and it would not surprise me at all to see facilities emerge that are kind of drop-in, WeWork style locations for people to work in outside of the major cities,” Rod Flavell, CEO of FDM Group told me recently.
With pan-European research showing that remote workers are more productive, it’s perhaps no surprise that so many knowledge-based firms are voting with their feet and their wallets.
What It Might Mean If We All Work From Home
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Shifting sands
Of course, the corporate real estate market is not the only sector that will be affected by a shift to remote working. If people can work from anywhere, there is no incentive to live in expensive city center accommodation.
As we spend more time at home than perhaps ever before, the very nature of our abode has fundamentally changed, as indeed have our requirements for them. For instance, a traditional property maxim that it’s all about location, as we strive to live near good schools, our workplace, public transport connections, or other amenities, and people spend considerably in order to ensure their home is in just the right place.
This love of location has underpinned the home improvement boom of the last few generations, as property owners have sought to adapt their properties to meet their needs, whether through loft conversions, installing renewable technologies, or retrofits. Installations of renewable energy and energy efficiency devices have also been desirable as homeowners have sought to bolster the value of their investments.
The pandemic has also driven home the challenges inherent in the current design of properties. For instance, open plan living has become hugely popular in many new developments, but when we’re all in the house at the same time, the ability to find personal space in such a layout is significantly restricted. Single, open plan and multi-functional spaces may become a thing of the past, as the logic of the homeworking adult occupying the space during the day before the entire family coalesces together in the evening may no longer apply.
Such usage relies on the kind of phased occupation that the pandemic has rendered obsolete, as all members of the household have been occupying the house all of the time. If home working, and even homeschooling, are to become more prevalent, then there are likely to be changes in the way our homes are designed to provide more flexibility, so that parents can supervise children just as easily as they can obtain privacy and quiet for online calls or dedicated work.
Leveling up
This might also have profound implications for the regional distribution of wealth across nations. Across Europe there are consistently many more highly paid jobs in capital cities than there are in smaller towns and cities.
That might be changing as a result of the shift to remote work, however, with early indications that knowledge workers might be willing to turn their back on expensive city center accommodation to live and work in cheaper, often greener environs.
Even if remote work is not undertaken on a full-time basis, this might nonetheless see people willing to commute further on the days they do go into an office. For instance, the urban think tank The Centre of Cities suggests that the London commuter region might expand outwards to areas such as Hastings or Grantham, both of which are over an hour away by train.
Across the developed world, there is a desire for wealth to be more evenly distributed across countries, especially as areas like Hastings have long suffered from poor productivity, unemployment and the assortment of social problems associated with these things. While there’s no guarantee that encouraging more highly educated people to live in places that have historically been “left behind” will automatically improve their fortunes, it is highly likely to give those places a boost to their fortunes.
With a recent paper from Cornell University suggesting that remote working is likely to endure for some time, there are going to be significant implications not only for how we work, but for the industries and infrastructure that have grown up around those working norms.
“We know that previous major world events had a profound impact on workplaces and the kind of work people do,” the authors explain. “In fact, these events led to the demise of some markets and businesses and the creation of others. This pandemic is no different. It will change work in fundamental ways, and this will challenge people to learn to work in ways dramatically different than previous generations.”