Why Working From Home Will Stick
Early Career Research Award
We survey over 20,000 of U.S. workers over several waves to investigate whether, how, and why working from home will stick after COVID-19. The pandemic drove a mass social experiment in which half of all paid hours were provided from home between May and December 2020. We estimate about 20 percent of all full workdays will be supplied from home after the pandemic ends, compared with just 5 percent before. We provide evidence on five mechanisms behind this persistent shift to working from home: better-than-expected experiences working from home, diminished stigma, investments in physical and human capital enabling working from home, reluctance to return to pre-pandemic activities, and innovation supporting working from home. We also examine some implications of a persistent shift in working arrangements: First, high-income workers, especially, will enjoy the perks of working from home. Second, we forecast that the post-pandemic shift to working from home will lower worker spending in major city centers by 5 to 10 percent. Third, many workers report being more productive at home than on business premises, so post-pandemic work from home plans may raise productivity as much as 2.7 percent.