Millions of Americans have spent this year working from home, and employers have realized just how smoothly things can get done when they trust their staff to work remotely. But for those fortunate enough to work from home, will COVID-19 have a lasting effect on how we do our jobs? Or will millions of commuters return to cities if and/or when vaccines are made available?
A new study released this week by Vanguard has shed some light on the future of work. “Work-from-home arrangements represent a sharp acceleration of a trend that was already under way before COVID-19,” said Joseph Davis, Vanguard global chief economist. “But the big question for the U.S. economy is how many jobs, and what types, could permanently become remote?”
“For example, if tech workers can just as easily do their jobs from home offices in Toledo or Tulsa or Topeka, do Silicon Valley firms need vast California campuses?” he said. “And what would that mean for businesses that rely on such a concentration of workers and for commuting patterns? What would it mean for real estate prices, both commercial and residential?”
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Vanguard scored 41 tasks from 1,000 occupations tracked by the U.S. Department of Labor on a scale of 0 to 10 for remote-work potential. A score of “0,” for example, represents a task that cannot be accomplished remotely, while a score of “10” represents a task that can be performed 100% remotely, and with equal effectiveness.
“Roughly 15% of all U.S. jobs could be conducted remotely,” Davis found. “It represents potentially over 20 million U.S. workers.” He included a conservative model: a 60% effectiveness threshold was deemed good enough to complete the task in each respective occupation. “A higher threshold would mean that fewer occupations and workers could permanently work remotely,” he added.
In November, long-term unemployed Americans hit 3.9 million, accounting for over a third of the total number of unemployed people in the U.S. Although the overall unemployment rate fell in November, the number of people who were unemployed for 27 weeks or more rose. The labor-force participation rate, which measures how many people are working or looking for a job, also fell.
The U.S. unemployment rate has fallen by 8 percentage points over the past seven months to 6.7%, according to government data, but Scott Ruesterholz, portfolio manager at Insight Investment, a London-based global-asset manager, said, “It will likely take over 12 months to return to 5% unemployment and substantially longer to return to the pre-crisis 3.5% level.”
“This report is a clear reminder that while the U.S. economy continues to recover, the road will be bumpy, especially until the widespread rollout of vaccines,” he said. “This reality underscores the importance of targeted fiscal stimulus to impacted businesses and workers to bridge the economy until a return to normality and limiting permanent scarring.”
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December 12, 2020 at 04:11AM
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Does COVID-19 have the power to revolutionize work? This economist says yes - MarketWatch
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