Author: Hillary Hoffower
Source: Business Insider
Date: Mar 16, 2021
Now that vaccines and a massive stimulus package are here, the US economy is uniquely positioned for a great new era in the 2020s.
A major factor underlying the great economic potential of reopening lies with how the pandemic ushered in an era of remote work, which is likely here to stay to some extent in a post-pandemic world.
More than two-thirds of professionals were working remotely during the peak of the pandemic, according to a new report by work marketplace Upwork, and over the next five years, 20% to 25% of professionals will likely be working remotely.
Remote working has caused employees to rethink and better accommodate their priorities in life and employers to rethink operations regarding how they can best work with professionals and create teams, the report stated. But it also hasn't been without some downsides, such as blurring the lines between work-life balance and causing increased stress.
Overall, though, Upwork found the shift to remote work in the past year has ultimately benefited the economy in five key ways.
(1) Remote workers are more productive
Remote and and online collaboration technology are proving to be helpful with hidden benefits like making teams work better together, reported Douglas Quenqua for Insider. Higher meeting attendance rates, more attentive managers, simplified communication, and more breaks are just a few of the positive changes.
It's made many more productive. Sixty-one percent of workers said their productivity increased from working remotely, according to an Upwork survey. And an Upwork survey of hiring managers found 32.2% of them said they saw overall productivity rise as of late April, compared to 22.5% that felt it decreased.
These productive effects will only further develop as people adapt more to remote work, new technology is invented, and people will start remote businesses, wrote the report's author, Adam Ozimek.
(2) Remote work has freed up relocation opportunities
Remote work will redistribute opportunity across the US, Ozimek wrote. Upwork estimated that up to 23 million people plan to relocate.
Richard Florida, urban studies theorist and economics professor at the University of Toronto, has a similar mindset. He previously told Insider remote work will accelerate the movement of families out of superstar cities into suburbs and the 1% who are seeking lower taxes.
"I have long said that we will see the rise of the rest, given the incredible expensiveness and affordability of existing superstar cities," he said. "But it's not going to be the rise of everywhere. It's going to be the rise of a dozen or two dozen places." These places will consequently attract new talent, changing economic development.
Florida predicted that bigger cities will see a resurgence, though, as the US inches closer to widespread vaccination, reshaped by a newfound focus on interpersonal interaction that facilitates creativity and spontaneity.
(3) Employers are hiring more independent talent
Employers have become more inclined to build hybrid teams made up of both full-time employees and freelance workers, Ozimek wrote. A November Upwork survey that asked about plans for hiring freelancers in the next six months found that 36% of hiring managers plan to hire out more independent talent.
Fortune 1000 companies in particular have been tapping into more diverse talent regardless of matter location, found a recent report by Business Talent Group, a marketplace for independent consultants. Independent talent has especially increased in the C-Suite. There has been a 67% increase over the past year in executives seeking independent talent needs, per the report.
This increases the talent pool and opportunities for workers.
(4) Remote workers are saving time and money
Without daily commutes, workers have more hours and bigger bank accounts.
One year of working remotely has saved people on average nine days from commuting, per Upwork's research. And car commuters saved around $4,350, including costs to public from their driving.
The time and money saved could boost economic growth and productivity, Robert Gordon, economics professor at Northwestern University, said in a recent UCLA Anderson Forecast interview. The labor force has restructured, with high-paid people working from home and making the same income, he said.
"This shift to remote working has got to improve productivity because we're getting the same amount of output without commuting, without office buildings, and without all the goods and services associated with that," Gordon said. "We can produce output at home and transmit it to the rest of the economy electronically."
(5) Pandemic remote work is different from remote work
"Remote work and remote work during a global pandemic are not the same," Ozimek wrote.
Many of the struggles with remote work were due to pandemic circumstances — like balancing remote work with child care while schools were closed. In a post-pandemic world, these things won't be a hindrance and remote employees will be able to revel in fewer interruptions, which Upwork found to be one of the most cited benefits of remote work.
Remote work also won't always be done from home. Florida thinks neighborhoods will reshape as offices.
"Even as offices decline, the community or the neighborhood or the city itself will take on more of the functions of an office," he said. "People will gravitate to places where they can meet and interact with others outside of the home and outside of the office."