Up to this point in the COVID-19 pandemic, remote work has been a buoy keeping many parts of the economy afloat. We’ve seen that working from home was so successful and fears of loss of productivity were unfounded. Now we are starting to see a reactionary movement that will find it’s way into political agendas—how to get workers back in the office.
It’s easy to dismiss this problem as a non-problem. Remote work is just work. The economy likes growing businesses because it creates jobs.
Who loses out when the number of people working from home increases? Commercial real estate is seeing their value decline considerably, cities are losing tax revenue. Millions of people without access to high speed internet and a home environment conducive to work creates inequality in remote work.
It’s a matter of time before a political party includes remote work into their platform or scapegoats it.
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San Francisco Mayor London Breed said that workers are not returning to the office which has resulted a loss of $400MM in tax revenue. Some of the reasons for this is fewer people in the city (while not an exodus, the office vacancy rate is more than 24%) but I suspect this is also due companies moving out of SF for tax reasons (Stripe moved to Oyster Point).
Remote work can save employers and estimated $200B per year and help reduce inflation. Workers are willing to accept smaller pay for increased work from home options. A recent paper found that this would reduce wage growth by 2 percentage points over two years.
A recent study found that workers in Manhattan are spending $12.4B less than last year on meals, shopping, and entertainment near their offices. The author says this is due to remote work as workers are spending 30% less days in the office. This impacts local businesses that cater to office workers but also city tax revenue.