Who Still Works from Home?

Remote work, — aka work from home (WFH), — has been around for decades, but took off in the mid-late 1990s with the explosive growth of the internet. Some even predicted that the internet would lead to the decline of cities, because it would enable people to work, be in touch with friends and colleagues, and shop from home. Why would anyone choose to live in an expensive and crowded metropolitan area, when they could live in a more affordable, less stressful, potentially healthier location? Instead of declining, superstar cities continued to generate the greatest levels of innovation and good jobs, thus attracting a disproportionate share of the world’s talent.

But, everything changed when the COVID-19 pandemic spread worldwide in early 2020. “The coronavirus crisis is forcing white-collar America to reconsider nearly every aspect of office life,” wrote a June, 2020 NY Times Magazine article. “Some practices now seem to be wastes of time, happily discarded; others seem to be unexpectedly crucial, and impossible to replicate online. For workers wondering right now if they’re ever going back to the office, the most honest answer is that even if they do, the office might never be the same.”

The article cited the experience of Accenture, which at the time had around 500,000 employees in more than 200 cities in 120 countries. Before the pandemic, no more than 10% worked remotely on any given day. But, by the middle of March, nearly all were asked to work from home. Employees adapted quickly, said Accenture’s CTO. The volume of video calls went up by a factor of six while audio calls tripled. Despite having to switch from face-to-face to audio and video interactions, overall productivity actually went up as measured by several metrics.”

A survey covering 75,000 respondents between April and July of 2020 found that of those employed pre-COVID, about half were now working from home, including 33% who had recently switched to working from home and 15% who were already doing so pre-pandemic. 39% continued to commute to work, and 10% had been recently laid-off or furloughed.

I’ve continued to track the evolution of WFH by following the research of economists Jose Maria Barrero (Instituto Tecnológico Autónomo de México), Nicholas Bloom (Stanford University), and Stephen J. Davis (University of Chicago) who’ve been conducting monthly surveys  on the state of WFH since May of 2020. One of their first surveys found that the percentage of paid full days worked from home once COVID hit in April of 2020 was 61.4%, a huge increase from their 4.8% WFH estimate just before COVID. The percentage then went down in subsequent months. One year later, in April of 2021, WFH was around 45%.

In an April 2021 working paper, “Why Working from Home Will Stick,” Barrero, Bloom, and Davis predicted that the shift to work from home would be one of the biggest legacies of the pandemic. They projected that “American workers will supply about 20 percent of full workdays from home in the post-pandemic economy, four times the pre-COVID level. Desires to work from home part of the week are pervasive across groups defined by age, education, gender, earnings, and family circumstances.” They estimated that higher levels of WFH would boost productivity by about 4.6%, with over half of the productivity gain reflecting the WFH savings in commuting time.

Since May of 2020 their online surveys have compiled over 200,000 observations. The initial target population was US residents 20-64 who earned over $10K in 2019, which was later changed to those who earned more than $10K in the prior year.

Their latest survey was published in April of 2024. Let me summarize some of their key results.

• In early 2024, 59.2% of all full-time employees were full-time onsite; 12.8% were fully remote; and 27.9% were in a hybrid arrangement.

• For employees that can work from home, the most common arrangement was hybrid at 44.4%; 35.3% worked fully onsite; and 20.4% worked fully remote.

• Friday is the most popular day to work-from-home for hybrid workers, 48%; Thursday was the second most popular WFH day at 38% until late in 2023, but it has since declined in popularity and the second most popular WFH day is now Monday at 40%.

• In March of 2024, about 28% of paid days in the US were WFH days. The percentage of WFH paid full days has fluctuated around 30% since the middle of 2022.

• According to employees, the top benefits of WFH are: no commute, 49.2%; flexible work schedule, 42.9%; less time getting ready for work, 40.4%; quiet, 34.2%; more time with friends and family, 34.0%; and fewer meetings,17.3%.

• According to employees, the top benefits of working full time in the employer’s business premises are: face-to-face collaboration, 49.5%; socializing, 49.5%; work/personal life boundaries, 40.9%; better equipment, 39.3%; face time with manager, 30.2%; and quiet, 18.3%.

• Post-pandemic, workers able to work from home would like to do so around 2.7 days per week, whereas employer plans for workers able to work from home post-pandemic are 2.2 days for week, a difference of roughly 0.5 days.

• In March of 2024, employees desired 31.5% fully remote jobs, while employers wanted fewer fully remote jobs, 22.2%. On the other hand, employers wanted over twice more fully onsite jobs, 34.6%, than employees wanted, 16.8%.

• Not surprisingly, days per week working from home are highest in the information technology (2.27), finance & insurance (2.22), and professional & business (2.09) sectors; followed by arts & entertainment (1.95); real estate (1.72); utilities (1.58); wholesale trade (1.53); health care & social assistance (1.29); construction (1.22); government (1.21); education (1.12); manufacturing (0.85); retail trade (0.78); transportation & warehousing (0.69); and hospitality & food services (0.62).

• Older workers are fully on site more often than younger workers: 50 - 64 (65.4%); 40 - 49 (59.3%); 30 - 39 (54.3%); and 20 - 29 (56.8%).
  

“Who Still Works From Home?,” a March 8, 2024 NY Times article, wrote that “the shift to a permanent hybrid-work reality has been gradual, with periods of tension as workers across white-collar industries pushed against executives’ return-to-office orders. Those battles have largely come to an end, and workplaces have reached a new hybrid-work status quo. Roughly one-tenth of workers are cobbling together a combination of work in the office and from home, and a similar portion are working entirely remotely.”

The article noted that while the biggest group of US workers ages 25 and up, roughly 62%, have no college degrees, college educated workers are particularly prominent among the roughly 40% of workers able to work from home all or some of the time.

“Working from home is, for the most part, a luxury for the highly educated. White-collar workers were in many cases able to do their jobs safely at home, but lower-income workers often had to continue to work in person, even when health risks were highest. And now that the public health emergency is over, that workplace divide — who gets the benefits of remote flexibility and who does not — has become entrenched.”

The remote work patterns for men and women with college degrees are fairly evenly distributed with one major exception: parents of small children. “Among college-educated men, having children does not make much difference to whether they work at home or in person. Among women, it’s a different story. Mothers of young children are much more likely to work remotely than women without children or mothers of older children.”