Hicks
It must be said again and again that 48.2% of college graduates in the U.S. were working remotely, according to the February 2023 Census survey. That number is up slightly from late 2021, suggesting that remote work is here to stay.
It is also important to connect the dots with job creation and remote work. Since 1992, 81% of all the net job growth has occurred among college graduates, with the remainder going to those with an associate’s degree or some college training. This trend shows no likelihood of changing.
Combining these two facts means that something like 45% or more of all the jobs created in the coming years will be remote jobs. Even if the share of remote work peaks at its current level, we are in a world where remote work affects employers and employees around the country. It also affects all our economic development, tax increases, education and fiscal policy as well.
In later columns, I’ll explain why retaining the status quo on the way we tax, attract businesses and improve public services will be damaging, if not fatal, to most state and local governments. Here I want to personalize the experience through the eyes of three 20-something women from the Midwest.
Over a short holiday, I stayed with a family with three granddaughters. These cousins, all from the Midwest, graduated college in the past decade. The youngest is 24; the oldest will soon turn 30. They are college graduates, each in different professions, who now live on both coasts.
The oldest has worked in a partially remote setting since graduation. At first, she commuted occasionally to work in a large eastern city. But, after a few months, she was able to perform most of her job at home, using the familiar technology of the computer, Zoom and a phone. Long before COVID, this woman and her husband both worked remotely, turning spare apartment bedrooms into separate offices.
Her work included both technical research and writing about the results of that research. The collecting, processing, analyzing and communicating of data is what about 4 in 10 American jobs do now to some degree or another. These types of tasks can readily be done remotely. The couple mentioned above are now moving to be near family, but in a very expensive city, with good schools and an airport.
The youngest is a military officer in her first assignment. As is common in this profession, she spends about half her time traveling. That is a euphemism, for a variety of experiences that are not tourist-like because she serves in a combat support unit. But, surprisingly as it may seem, her command offers remote work one day per week.
This might seem striking because most of her duties involve classified material that cannot be accessed at home. But, every job has administrative duties, un-classified or unsecured online training modules, and the like. She occasionally heads to the office on the remote work day, and of course a variety of duties may call her away. But, this is the third consecutive commander to retain the remote work schedule.
Remote work in the military might seem a bit counterintuitive, but the armed forces compete for talent just like any business would. This necessitates innovation in the way work is organized. My hunch is that across every military career field, a third to half of jobs could have a substantial remote work component. Commanders will need to figure out how to accommodate this, or else struggle to retain the talented young people they need.
The third cousin works in finance and accounting at a large, privately held firm. She enjoys the position. It is exciting, fairly high-paced, and exposes her to a variety of business problems. It is in a great location, which meant she was willing to take a modestly smaller salary than elsewhere to relocate to the area. She was on the job just a year before COVID hit.
Perhaps foretelling the future, the company handled COVID poorly and confusingly. At one point, they required only the vaccinated workers to come to work, permitting those who chose not to take the vaccine to work remotely. That shockingly poor decision was reversed after only a week, but shows how mindless the workplace rules were at this firm.
Today, they absolutely do not permit remote work. Not surprisingly, they have lost a number of employees to firms that allow more flexibility. They have also failed to hire the replacement workers they need. There’s growing doubt among the younger workers that they’ll have successful hires for these positions, since nearly all the applicants expect some remote work options.
The problem is not the human resources staff. They’ve compared productivity during the forced period of remote work with today and found little difference. They’ve also compared position descriptions, salaries and remote work. They think it is less expensive to have some flexibility; the company’s leadership just remains inflexible on the subject.
The experiences of these three women point to the difficult adjustment period we are in today. It is clear that remote work is a huge, popular and growing segment of employment. Some tasks cannot be performed remotely, while others are perfectly suited to it. Some firms might be willing to pay a premium for workers to be on-site or might offer faster promotions to those who occupy offices full-time. But, the share of jobs that need to be performed in person are in long-term decline, while remote-compatible occupations grow.
I find the economic incentives pretty conclusively push in one direction—toward more remote work. In fact, I think the trend will be so inexorable that the really interesting research questions lie outside the workplace. Businesses, after all, will figure this out or fail. The exciting unanswered questions are elsewhere. How does remote work shift to outsourcing of jobs, here and abroad? What cities will become magnets for remote workers, and which will be remote work deserts? Will remote work make larger families easier to support, and employment more stable?
The experiences of these three young women offers insight into the modifications to work, home and family life that remote work now offers. This will be a key demographic to watch in the years ahead.
Michael J. Hicks is the director of the Center for Business and Economic Research and the George and Frances Ball Distinguished Professor of Economics in the Miller College of Business at Ball State University. Send comments to [email protected].
