BNo OSTON The most popular of the winter travel destinations. Many economists, however, were disappointed by the news that the grand annual meeting of their profession, scheduled to take place in the city in early January, would again be virtual. Greater experience with remote-conferencing technology means that events unfolded more easily than a year ago. It seemed appropriate for a conference dominated by speculation on how Covid-19 could change the economy permanently.
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Many sessions were devoted to sketching possible features of the post-epidemic world. New habits are stuck – and economists have gathered data to prove it. Take remote work. Jose Maria Barrero of the Instituto Tecnológico Autónomo de Mexico presented the results of the study with Nicholas Bloom of Stanford University and Steven Davis of the University of Chicago. Economists have conducted a monthly survey since May 2020 that asked Americans, among other things, about their plans to work remotely. A year ago, results suggested that remote work was responsible for 20% of full-time hours after an epidemic.
Over the past year, however, remote work has gained traction. Based on the results of the survey from December, the researchers think that 28% of the hours can finally be worked from home. Employees who were once indecisive now say they can sometimes work from home, Mr Barrero said. And respondents who always said they would work from a distance now plan to spend more time doing it. In all, about 15% of full-time workers are expected to be completely distant in the future, and just under one-third will work in a “hybrid” fashion – a dramatic change from before the epidemic, when only 5% of the population was working. Home.
Long-distance work will continue because its experience has been better than expected and workers and organizations have invested time and money (together Mr Barrow estimates that about 0.7% of America’s value is GDPTo make it even better. However, the new system will also be driven by the choice of employees. While many employees look forward to returning to the office, a large portion প্রায় about 15% say they will definitely or probably leave employers who do not offer remote options. This has created an opportunity for young companies to attract talent through remote recruitment, says Adam Ozimek of Upwork, a freelance-work platform.
As the opportunity to work from a distance increases, people are happier moving away from big, expensive cities. Mr Ozimek noted that research published early in the epidemic suggested that the most significant geographical impact of the new work system would be on the distribution of population between cities. The reduction in commuting as a result of the hybrid system will create a “donut effect” as people leave city centers for remote suburbs. But an analysis of recent data suggests that relocations within the city are increasingly significant. Home prices and rents have risen more slowly than in other areas, including higher housing costs and a large portion of the workforce that can be done remotely. While the 2020 data sends a vague message about migration trends, the 2021 figures show clear outflows from high-value places like California.
Some parts of the world may face uncomfortable adjustments as b-entrepreneurship puts severe pressure on parts of America and Europe in the 1970s and 1980s. The study, presented at Columbia University’s Connor Walsh Conference, found that the economic burden of the epidemic fell heavily on less skilled service workers in dense and expensive cities, who previously met the demand for skilled workers. The permanent exodus of white-collar professionals can trap some less-skilled workers in places where job prospects are declining.
Although more distant future may offer some offsetting benefits. Pockets of economics studies suggest that epidemic-related changes hold up the potential for productivity gains. Emma Harrington of Princeton University discusses research that shows that call-center staff productivity increases by 7.6% when work is remote, without any noticeable drop in customer satisfaction. Dan Zeltzer of Tel Aviv University presents an analysis of the transition to telemedicine in Israel, which shows that resource use continues to increase and costs continue to decrease, with little sign of further misdiagnosis or other negative health outcomes.
Virtually unknown
It is no less clear whether such gains will translate into a stronger macroeconomy. Janice Aberley of Northwestern University credits the distant work of reducing this fall. GDP By early 2020, it is about half the size of what it would otherwise be. Although remote work could increase the company’s profits by reducing the cost of office space, and reducing travel to improve well-being, he doubted it was a fundamental change enough to lead to sustainable productivity gains. It is accompanied by other, more general fears about the post-epidemic economy. Catherine Mann of the Bank of England is concerned that business investment may prove inadequate, with prospects for growth and uncertainty over unrivaled markets. Although investment was strong in 2021, recent studies show that appetite for capital expenditure has decreased, compared to share buybacks and consolidations, he noted.
Larry Summers of Harvard University observes that while central banks may struggle to control inflation in the short term, long-term growth may still be restrained by the same headwind as the demographic shift before Covid-19. The outcome of the conference often seemed to suggest that although economies did better than many people expected during the epidemic, they might be disappointed later. But with participants from around the world zooming in from session to session without visiting an airport or queuing for coffee, one has to think that such decisions were not too pessimistic. 3
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This article was presented in the section on Finance and Economics of the Print Edition under the heading “Distant Possibilities”.