Is Home Work Your Employment Future? Office Work Isn’t Dead Yet

As the pandemic rages on, there’s speculation about how Covid-19 is changing work, with many claims of a massive, permanent shift to working at home.  But don’t sell your second car or turn in your commuter rail pass just yet. The jury is still out on the scale of any shift to working at home, and many white-collar workers will probably return to their offices.

Some studies suggest a huge Covid-driven shift to home work. Researchers at MIT used a Google GOOGL survey to conclude “that since between February and May 2020 over one-third of the labor force switched to remote work, resulting in about half of American workers now working from home.” 

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About half of American workers?  That’s well above a University of Chicago study estimating an “upper bound on what might be feasible,” finding that “37 percent of jobs in the United States can be performed entirely at home.”  If the MIT study is right, then many more jobs are actually being done at home than the Chicago researchers found to be possible!

In turn, both of these estimates are very large when compared to more comprehensive and pre-pandemic data sources.  The U.S. Census Bureau estimated that in 2018, only 5.3% of workers worked from home.  (Other federal sources find somewhat higher numbers but the difference is rooted at least partly in how the question is asked.)

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The MIT results may be inflated by their measuring responses at the height of the pandemic, when the economy was virtually shutting down.  A better way to think about the issue is identifying which jobs and industries can be done at home, which both teams do.  The Chicago study uses twenty-two separate occupational clusters from the Bureau of Labor Statistics’ Standard Occupational Classification (SOC) system, allowing a more fine-grained analysis.

Not surprisingly, different occupational clusters have different work-at-home potential.  These include ten job groups at the bottom range of 6% or below, including zero jobs in “construction or extraction” or “food service preparation and serving.”  At the high end, there are nine clusters above 50%, including five higher than 87%, including “legal” (97%), “education, training and library” (98%), and “computer and mathematical” (100%) occupations.

Jobs with work-at-home potential also pay higher median wages.  And metropolitan areas with more of these jobs are linked to higher household incomes and workers with college degrees, while there’s a negative correlation for metros with homeownership rates and percent of white residents. 

But just because your job can be done at home doesn’t mean it will be, especially in the long term.  Although U.S. workers are slow to return to their offices, countries where the pandemic is managed better report much higher rates of return.  The Guardian reports a survey from Morgan Stanley MS ’s AlphaWise finds “83% of French office staff have returned, followed by 76% in Italy” due partly to those countries’ more successful virus management.

There are a lot of reasons, both for employers and employees, to work together.  First, as noted, many occupations simply can’t be done from home.

And even for those that can, analysts worry about productivity.  Stanford economist Nicholas Bloom fears a surge in home-based work “will create a productivity disaster for firms.”  (This is a surprising turnaround, since Bloom in 2014 wrote a Harvard Business Review article entitled “To Raise Productivity, Let More Employees Work From Home.”)

The difference is pandemic-driven working from home often isn’t voluntary or planned well, so it often can be less productive.  Especially for families with school-age children, the work environment isn’t controllable for noise or disruption.  And working exclusively at home—versus some of the time in a planned strategy—could reduce innovation, which many analysts feel comes from sustained face-to-face interactions.

Face-to-face interactions also build networks, which help people advance in their careers.  That’s why women professionals rightly fear being bumped onto the “mommy track” if they take child care leave.

 As economist Heather Boushey has shown, our inadequate public policy for care work means women are pushed into providing care for children, along with the elderly and other dependents.  This means their careers suffer along with overall productivity and innovation.  So working at home could add a new lane to the “mommy track.” 

Another barrier to working out of the office is management’s need to control work.  Marxist economist Harry Braverman, in his famous book Labor and Monopoly Capital, showed how modern managerial methods evolved out of the need to discipline workers for maximum productivity.  When I was writing a study of New York’s financial services industry, a senior manager illustrated this point, saying office jobs wouldn’t be relocated too far away because “you need to be able to go down the hall and yell at somebody.”

It’s clear that lots of employees want to work at home at least some of the time, as Forbes contributor John Koetsier has told us.  But it’s less likely that employers will let them do so on a massive scale.  Yahoo made a massive turnaround in 2013, ordering staff back to the office in order to increase productivity.

Because of Covid, companies like Google and Facebook have told workers they can work remotely until mid-2021.  But Facebook also recently leased a massive new office location in mid-Manhattan.  They’re going to put somebody in there.

So whatever Covid-driven spike we are seeing in home working will likely recede.  It may become a new perk for highly skilled or highly sought-after workers.  But it’s unlikely to become the “new normal,” even if many white-collar workers want it.  Innovation, productivity, networking, and managerial control all are working against it.

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