The new “working-from-home economy” will likely continue after the pandemic, predicts Stanford economist Nicholas Bloom, in an article shared by Slashdot reader schwit1.
Bloom cites results from several nationwide surveys he’s conducted:
We see an incredible 42 percent of the U.S. labor force now working from home full-time. About another 33 percent are not working — a testament to the savage impact of the lockdown recession. And the remaining 26 percent — mostly essential service workers — are working on their business premises. So, by sheer numbers, the U.S. is a working-from-home economy. Almost twice as many employees are working from home as at work. More strikingly, if we consider the contribution to U.S. gross domestic product based on their earnings, this enlarged group of work-from-home employees now accounts for more than two-thirds of U.S. economic activity…
The stigma associated with working from home prior to COVID-19 has disappeared… And a number of corporations are developing plans for more work-from-home options beyond the pandemic. A recent separate survey of firms from the Survey of Business Uncertainty that I run with the Atlanta Federal Reserve and the University of Chicago indicated that the share of working days spent at home is expected to increase fourfold from pre-COVID levels, from 5 percent to 20 percent. Of the dozens of firms I have talked to, the typical plan is that employees will work from home one to three days a week, and come into the office the rest of the time…
Growth of city centers are going to stall. During the pandemic, the overwhelming share of employees who shifted to telecommuting previously worked in offices in cities. I estimate that the loss of their physical presence slashed total daily spending at city center restaurants, bars and shops by more than half. This upsurge in working from home is largely here to stay, and I see a longer-run decline in city centers. The largest U.S. cities have seen incredible growth since the 1980s as younger, educated Americans have flocked into revitalized downtowns. But it looks like that trend will reverse in 2020 — with a flight of economic activity out of city centers.
The upside is this will be a boom for suburbs and rural areas.
Bloom also predicts firms trying to cut the density of their offices will scatter from high-rise city skyscrapers into low-rise buildings in industrial parks, reducing the crowds on mass transit — and the need to ride on elevators.