This is how 50 M Americans are about to change the U.S
This summer the future of the workplace will be unveiled as close to a third of the American workforce (about 50 million people) will be working somewhere other than the office. And while remote workers traditionally work from home, the location and nature of that home office may be changing in two considerable ways. The work from anywhere trend has been growing over the past few years, and COVID19 is about to institutionalize it.
The unnecessary office tested
The economic and environmental impacts of the workplace have been rising. The average American commute reached close to 1 hour a day in 2018, with a cost of $2,600 and 3 metric tons of CO2 emissions each year per individual. The open floor office runs employers an annual fixed cost per employee that can range between $4,000 in Atlanta to $15,000 in New York. The cost to live in a crowded metro area like the Bay Area is 2.7 times the U.S. average, which translates to expensive wages.
A number of studies suggest that remote employees are 15 to 55% more productive. The reasons supporting increased productivity relate to enhanced work-life balance, flexible schedules, fewer distractions and more time available to work. Even collaboration seems to be improved, benefitting from better prepared and shorter interactions. In addition, companies that have transitioned to a (fully or partially) remote workforce have shown to have up to 50% less employee turnover.
Remote work simply works
These are some of the reasons there are many office-free (or headquarter-free or virtual) companies today. Some transitioned into this model (e.g. FlexJobs), while others started like that (e.g. Automattic/WordPress). Prior to COVID-19, about 26 million Americans telecommuted (fully or partially) and 57 million, or about 35% of the workforce, were freelancers. Of those in the gig economy, 63% worked from home.
Most recently, in the midst of stay at home and shelter in place orders, the leadership of Mondelez, Barclays, Nationwide, Morgan Stanley, Twitter, Square, and Facebook have expressed their desire to institutionalize remote working for as many of their workforce as possible. Global Workplace Analytics predicts that about 30% of the workforce will remain remote employees after COVID-19.
Another great American migration?
Now that COVID-19 has solidified the transition to a much larger remote workforce, the question for many will be, where will that home office be located? Fully remote employees will no longer be geographically bound to where their company headquarters are. A 2019 survey found that 44% of Bay Area residents were considering moving, 77% of the respondents citing high housing costs as the main reason. With location constraints lifted, how much will that number jump? And where will they go?
The last major migration in the U.S. occurred during the suburbanization movement in the 1950s and ’60s which was largely fueled by the G.I. Bill. For over a century the prolonged trend has been the concentration of population growth around metro areas, fueled by a concentration of economic opportunities.
Over the past years, Americans have been moving away from expensive metros such as San Francisco or New York. They have been going to cities like Phoenix, Sacramento, Austin, Las Vegas, Nashville, Atlanta, or Dallas, to name a few. These cities offer a balance of affordability and jobs. But if your job now travels with you, the possibilities are wide open.
A taste of our vast land
As we witnessed this Memorial Day weekend, Americans are ready to go outside. While many plans involving flying, cruises, or festivals may not be in the cards this summer, people will adapt their travel accordingly. A third or more of the workforce is expected to continue work remotely and many children are still distance learning, creating a perfect recipe for yet another opportunity: the extended work-pleasure summer vacation.
This upcoming vacation season will allow…
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