Remote work has become a significant trend in the U.S. labor market, with economists recognizing it as a major shift that has taken place over the past couple of decades. According to Nick Bunker, economic research director for North America at job site Indeed, the work-from-home revolution is still going strong and is expected to continue for a long time. The term “remote work” encompasses employees who complete their tasks from home on a full-time basis, as well as those who have hybrid arrangements, splitting their workweek between the office and home. Prior to the Covid-19 pandemic, such arrangements were uncommon, but they gained popularity during the stay-at-home orders that were implemented in response to the pandemic.
While there has been a decrease in remote work opportunities from their peak, they have stabilized at levels significantly higher than before the pandemic. Data from WFH Research shows that the percentage of days worked from home during the workweek has remained steady at 25% to 30% since early 2023, which is more than triple the pre-Covid rate. Similarly, the share of online job listings offering remote or hybrid work has leveled off just below 8%, which is about three times higher than in 2019, based on Indeed data. Economists agree that remote work is here to stay, as it continues to benefit both workers and employers alike.
Research conducted by Nick Bloom, an economics professor at Stanford University, indicates that workers value hybrid work arrangements almost as much as an 8% raise. This high value placed on remote work by employees makes it challenging for employers to eliminate this option. From the employer’s perspective, remote work can be a profitable arrangement. Businesses can save money on expenses such as office space by transitioning to remote work models. Additionally, remote work expands the talent pool by enabling companies to hire individuals from diverse geographical locations. Furthermore, workers who can work remotely tend to have higher retention rates, leading to cost savings in hiring, recruitment, and training.
While remote work offers numerous benefits, not all jobs can be performed from home. Around 36% of employees with jobs that could be done remotely were still working in the office full time as of July, as reported by WFH Research. Some companies have highlighted drawbacks of remote work, including challenges in monitoring and mentoring employees. A survey by ZipRecruiter revealed that 45% and 42% of employers cited reduced ability to observe and mentor employees as significant concerns. Economic downturns could potentially prompt employers to scale back on remote work, especially if workers lose bargaining power. However, the financial advantages of remote work may deter many companies from making such changes, as they understand the impact it could have on morale and productivity, particularly during a period of already-low morale.
The shifting dynamics of the U.S. labor market towards remote work signify a long-lasting change that benefits both workers and employers. While challenges exist, the advantages of remote work have solidified its position as a permanent fixture in the evolving landscape of work arrangements.