Why Working From Home Will Stick

TLDR

COVID-19 drove a mass social experiment in working from home (WFH). The study surveys over 30,000 Americans to investigate whether working from home will persist post‑pandemic and why, and to project its employee and economic consequences. The authors conduct a multi‑wave survey of 30,000 Americans and analyze five drivers—improved WFH experiences, capital investments, reduced stigma, lingering health concerns, and tech innovations—to explain the shift. The data show that 20 % of full workdays will be remote post‑pandemic (up from 5 % pre‑pandemic), yielding employee benefits, a 5–10 % drop in city‑center spending, and a 5 % productivity boost—though only a fifth of this gain appears in standard productivity metrics.

Abstract

COVID-19 drove a mass social experiment in working from home (WFH). We survey more than 30,000 Americans over multiple waves to investigate whether WFH will stick, and why. Our data say that 20 percent of full workdays will be supplied from home after the pandemic ends, compared with just 5 percent before. We develop evidence on five reasons for this large shift: better-than-expected WFH experiences, new investments in physical and human capital that enable WFH, greatly diminished stigma associated with WFH, lingering concerns about crowds and contagion risks, and a pandemic-driven surge in technological innovations that support WFH. We also use our survey data to project three consequences: First, employees will enjoy large benefits from greater remote work, especially those with higher earnings. Second, the shift to WFH will directly reduce spending in major city centers by at least 5-10 percent relative to the pre-pandemic situation. Third, our data on employer plans and the relative productivity of WFH imply a 5 percent productivity boost in the post-pandemic economy due to re-optimized working arrangements. Only one-fifth of this productivity gain will show up in conventional productivity measures, because they do not capture the time savings from less commuting.