The Rise of Remote Work: Evidence on Productivity and Preferences from Firm and Worker Surveys

Abstract

Drawing on surveys of small business owners and employees, we present three main findings about the evolution of remote work after the onset of COVID-19. First, uptake of remote work was abrupt and widespread in jobs suitable for telework according to the task-based measure from Dingel and Neiman (2020). The initial adoption lead to a persistent shift in work arrangements that both firms and workers forecast would continue into the future. Second, business leaders’ perceptions of how remote work affected productivity shifted over time. In early 2020, 70 percent of small business owners reported a productivity dip due to remote work. By contrast, the median business owner reported a positive productivity impact of remote work by 2021. Third, 21 percent of workers report being willing to accept a pay cut in excess of 10 percent if it allowed them to continue working from home, but the median worker in a teleworkable job would not tradeoff any compensation for the option of continued remote work. Taken together, our evidence points to perceived productivity gains and some workers’ preferences as reasons for the persistence of remote work in the years following the onset of COVID-19.