Not everyone can work from home. Smithfield can’t crank out wieners from 3,700 workers‘ kitchens (but we shouldn’t worry about protecting Smithfield from death and more than they worried about protecting their workers). Plumbers can’t fix your toilet by telepathy or drone (yet?). Road crews can’t repair our highways from a distance (although with people driving much less, maybe those crews won’t have to go out as often).
A recent study from the University of Chicago says that two-thirds of workers can’t do their jobs from home:
…Assoc. Prof. Jonathan Dingel and Prof. Brent Neiman of the University of Chicago Booth School of Business undertook a new study to learn how many jobs can be performed at home, what share of total wages are paid to such jobs, and how the scope of working from home varies across cities and industries.
“Social distancing is difficult for everyone, but some people and sectors are disproportionately hurt,” said Neiman, the Edward Eagle Brown Professor of Economics, who conducts research on international macroeconomics and trade. “Most jobs in finance or insurance have a chance to continue with some degree of normalcy through the crisis, as they can be performed at home away from others. For just about everyone that works in hotels or restaurants, this is not an option.”
…This analysis reveals that 34% of U.S. jobs can plausibly be performed at home. Assuming all occupations involve the same hours of work, these jobs account for 44% of all wages (occupations that can be performed at home generally earn more). They found there is significant variation across cities [“With Much of U.S. Staying at Home, How Many Jobs Can Be Done Remotely?” UChicago News, 2020.03.30].
The significant variation Dingel and Neiman find ranges from less than 30% of jobs doable from home in Grand Rapids, Michigan; Lancaster, Pennsylvania, and Bakersfield, California, to 50% of jobs remotable in San Jose, California, and Washington, D.C. That variation comes from the different mixes of jobs in local economies:
Notice that farming is placed at the low end of the doable-at-home charts… but that seems odd: traditional farming is all about working at home, on a schedule determined by oneself and by the weather. It’s only when farming becomes industrialized and we have to import laborers to harvest massive fields and milk several thousand head of cattle at once that farming becomes just another factory job instead of a cozy family operation.
Many jobs require workers to show up at specific locations to produce their goods and services. But the above charts and your own experience on Zoom this week demonstrate that many do not. Even within certain jobs, workers and their bosses may find that certain functions (paperwork, meetings, training) can be done remotely, allowing workers to flex their time, putting in one or two days a week from home.
Think about what we can gain from whatever amount of work we can shift from the office to our homes. Liz Farmer at Governing offers her personal observations on working from home:
Use a commuting cost calculator to see how many thousands of dollars a year you’d save on gasoline, parking, depreciation of your car and other items.
Just as valuable is the time you save. Don’t just think about your transit time, but factor in your time spent saying hello or goodbye to coworkers, stopping for coffee or whatever rituals are included. For example, my actual commute on public transit used to be about 40 minutes. But in real time, my commute took an hour each way.
…When I first started working from home part-time, I thought I would use the extra time to visit my then-baby at daycare. Instead, I found myself cleaning, running errands, working on side projects and pulling weeds in the garden. I took care of the annoying, ankle-biter tasks that I’d previously designated for weekends. So, I gained family time on the weekends.
When my husband and I started working from home full time, we moved out of the burbs and to the country. We got more house for our buck, a lower cost of living, and public schools just as competitive as the ones we left behind [Liz Farmer, “Pandemic Reveals Working from Home as Viable Possibility,” Governing, 2020.04.21].
Employers could also save money on working from home:
- Nearly six out of ten employers identify cost savings as a significant benefit to telecommuting.
- Alpine Access Remote Agents close 30% more sales than traditional agents the year before. Customer complaints decreased by 90%. And turnover decreased by 88%.
- IBM slashed real estate costs by $50 million.
- McKesson saves $2 million a year.
- Nortel estimates that they save $100,000 per employee they don’t have to relocate.
- Average real estate savings with full-time telework is $10,000/employee/year.
- Partial telework can offer real estate savings by instituting an office hoteling program.
- Dow Chemical and Nortel save over 30% on non-real estate costs.
- Sun Microsystems saves $68 million a year in real estate costs.
- Offers inexpensive compliance with ADA for disabled workers.
- Saves brick and mortar costs in industries where regulations or needs require local workers (e.g. healthcare, e-tail) [“Costs and Benefits,” Global Workplace Analytics, retrieved 2020.04.23].
The coronavirus is demonstrating that there are a lot more jobs we can do without supervision, regimentation, scheduling, and crappy cubicles. So maybe this pandemic has the potential to do some long-term good for our economy.
My “road construction” job starts up Monday. Over the years, hotels have become like my second “homes” for 6 months of the year. Our crews’ typically consist of between 4 and 9 people. Our work all day keeps us at least 20-30 feet apart, and much of the time, confined in separate compartments/rooms (cabs). We have no need to interact in physical proximity between ourselves or any “visitors” to the sites. All the communication necessary can be done by phone.
Restaurants won’t likely be open where we’ll be working, so a once a week grocery store run and “home” (the daily cleaned and sanitized hotel room) cooking will be the normal course for meals. Hotels being mostly empty will hopefully mean everyone on the crew gets their own room. It’s almost like a remote work from home scenario.
You are a lucky man, Richard.
JUST IN: 4.4 Million New Unemployment Claims Filed This Week Bringing Total to More Than 26 Million During Coronavirus Outbreak
A lot of jobs can be home-based now, and many businesses are finding ways to do that to save money. I know of several insurance companies that put much of their customer service and claims departments at home. Big savings for the company’s space needs, as well as a benefit to employees in lack of commutes, proximity to kids. The employee, though, had to have a dedicated space in their home for an office, so that expense was off-loaded onto the employee. Some employers will increase a home-based employee pay to make up for space. I believe that home office space can be used as a tax deduction.
Hear that, “thud”? The need for and cost of commercial real estate fell by 1/3. AI (artificial intelligence) strikes again – good for society, but will greatly disrupt real estate careers, portfolios, banks, and tax bases.
Of 8 primary relatives: 3 work full time from home, 2 work part-time from home — under normal circumstances. In the COVID-19 environment 2 more work part-time + from home.
Hey, Richard! How well can you count on those hotels to deep-clean your rooms between guests and to make sure their employees maintain strict health protocols while you are staying there? I ask not to cast suspicion, but to honestly inquire if the hospitality industry is ready to maintain hospital-level cleanliness standards to satisfy its customers.
I shouldn’t compare real work to blogging, but I’ve occasionally wondered if investing in a downtown office would help the blogging business—maintain a visible physical presence in the community, have a space available for interviews and events. But reporters don’t need an office for interviews; when we’re not in quarantine, they go out and talk to their subjects where their subjects are, get photos and video there for context. A blogger can get visibility by hanging out at the coffee shop, and a hot chocolate every other day is much cheaper than monthly rent and utilities and upkeep on a downtown office. Why bother?
I keep heading in to my campus office because I have a better computer set-up there, I occasionally need the big copier/scanner, we have some physical files that we just can’t move offsite, and because the majority of the workplace population (students and faculty) are all doing their thing online. With a little planning, we could probably move 95% of our operations to remote. I could easily handle any remaining immobile tasks with a half-day visit to the office once a week.
So I wonder: how many jobs that currently look unmovable could workers do remotely with robots? How many of those jobs could we completely automate? And how many pandemics will it take before we realize everyone needs to be a knowledge worker… and we need to support everyone with a universal basic income to weather both public health crises and economic revolutions wrought by technology?
Thinking about the need for actual human to human contact that all humans have. How can that need be met for people living alone?
I’m thinking of 2 things – Warm blooded, soft bodied pets and some type of physical human connection arrangement.
I don’t know how the 2nd part would work. Maybe something like a clothed massage of shoulders, arms and back by a person who’s recovered and is immune? (Although we don’t know if that will work.) They’d be like the people who work as “cuddlers.”
I have a good friend, single and near retirement age. She has no children, but dogs. She works from home for an insurance company, under very similar circumstances to what Donald Pay describes. She never reports to an office, except once or twice a year for big corporate announcements. She loves working from home. What she doesn’t realize is she gets stranger and harder to get along with as time goes on. Maybe some people can get along fine- but regular in person human contact is pretty important.
Cory, I suspect that the hotels will be having MANY fewer guests overall, so staff will be able to spend more time on each individual room.
mfi, lucky maybe this year, but highway project funding for next year will likely disappear all together. meanwhile, the country will be considered “open” again and extended
unemployment benefits hiding in the same dark corner as highway funding.
More time on each room is good, but will staff be keeping themselves healthy and taking precautions ro prevent spreading whatever they may have? Will hotel owners be generous with sick leave time… or, like Smithfield, will they continue to exploit their low-wage, often immigrant workers, pressuring them to keep coming to work even if they may have health concerns?
The psychological and social impact of not getting real human contact deserves a whole blog post or book of its own. I’m a bad guy to gauge those effects; I rather enjoy social distance. I see my wife and daughter, and most days, that’s plenty. I’m thinking about a mini-vacation where I just go disappear in the Black Hills National Forest for a few days then see if the world is still standing when I come out.
Cory, the two Counties I will be staying and working in in Minnesota (Rice and Steele) have, respectively 9 and 11 cases. They have populations of 64,000 and 36,000. A whole different scene to what’s going on in SD. I will probably be safer there than “at home”, in Lincoln County, SD. Definitely safer to when I was traipsing around in 8 airports, 4 states and 2 countries for 20 days in Feb. and March.
Richard I live in Rice County. You must be talking about Owatonna and Faribault. You will be safer in Minnesota. Good luck.
Debbo, Yep. Staying in Faribault, job site in Owatonna. They put us in hotels where we can cook and do laundry.
Well, sounds like cats can carry the Corvid……just saying…..
W-2 workers cannot get a tax deduction for their home office. Used to be though, “That means if you work from home as an employee for someone else, you can’t take the home office deduction for tax years between Jan. 1, 2018, and Dec. 31, 2025. But if you’re self-employed (a small-business owner, freelancer or rideshare driver, for example) you may still be able to claim the deduction.”
Noem/Jackley will face the fusion ticket of Nelson/Heidelberger, if I can get Stace to come out of political retirement.
That would be a good one, too, Mr. H. grudznick estimates a whomping beyond that one that young Ms. Wismer took. I believe that whomping was a record for the Great State of South Dakota.
You should no longer say “as your next governor” if you are not at least at the top of your own ticket. You should start saying “As your next Lt. Governor…” and then the Rhoden Rhangers will start up their massive campaign machinery against you and I wager you a breakfast you don’t take the county of Brown. Not with the Rhoden Rhangers against you, and with Mr. Nelson across your shoulders as you slog him forward.