Rebalancing the scales
There are reasons to believe the remote-work revolution won’t be as dramatic as some predict, though, says Dingel. Working from home has been technologically feasible since the advent of high-speed internet 20 years ago, but even in developed countries, the proportion doing it full time has been negligible.
“We didn’t see a mass exodus from cities,” he says. The conventional wisdom among economists is that there are significant benefits to the spontaneous in-person interactions only possible in a shared office.
Employee satisfaction with work-from home arrangements will also largely depend on how companies structure their business processes, says Dingel. Remote work is often conflated with flexible hours, but that relies on asynchronous ways of working where people don’t need to collaborate in real-time. If you still need to be on call for a typical 9 to 5, the benefits of working remotely are significantly reduced.
But while in most countries the proportion of jobs that go remote long-term is unlikely to get close to the percentages identified in his paper, Dingel expects a significant uptick after the pandemic. And that could require creative approaches to head off a widening gap between remote workers and those clocking in in-person. A government’s standard tool for dealing with inequality is redistribution via the tax system. “There isn’t such a tool analogous to the tax system if we’re talking about increases in unequal flexibility or unequal life satisfaction,” says Dingel.
One option would be to focus policy on problems affecting those unable to work from home, says Palomino. That could include subsidising commuter transport, or incentivising companies to provide better childcare options. “It could be more targeted and nuanced than just giving out money and taxing the people that do telework,” he says.
Perhaps more important, though, will be helping more people access these higher-paying, remote-friendly jobs. Many countries will require significant investments in infrastructure, such as high-speed internet and reliable power supply, says Dabla-Norris, as well as proper childcare options. When the pandemic shuttered schools and day-care facilities, it highlighted the difficulty of juggling domestic and professional responsibilities without support, particularly for women carrying the bulk of this burden.
In his research, Palomino also found the biggest factor in whether or not someone can work remotely is access to higher education, which also governs earning potential. That suggests that the most important action governments can take is investing in training. “Looking into the future, I would say the impact of education, which has always been key, is going to be even greater,” he says.