How remote work is reshaping the economy
OSWEGO, N.Y. — While remote work is not a recent alternative, since the COVID-19 pandemic it has become an increasing trend in workplaces. When the pandemic hit, the world was forced to come up with solutions on how to continue on with life as normally as possible and in order to do that, working from home became the new norm. With this, the economy has seen both positive and negative effects.
Remote work allows people to travel less, saving money on transportation such as buses, subways, trains, and gas-saving that adds up annually.
The U.S. Department of Transportation Federal Highway Administration said that in the year 2020, the average American drives 1,060 miles per month, or about 35 miles per day, per driver. Miles traveled in 2020 were 12.4% lower than they were in 2019.
With the cost of gas in New York being more than $3 a gallon, working from home, and cutting out commute costs can save a person thousands of dollars a year.
Not only are remote workers saving the money they would have been spending on gas, but also by traveling less, there is less wear and tear on their vehicles, saving them the cost of repairs or even new car purchases.
“It is easy to fall into the trap of ordering lunch or stopping for coffee. By cutting out those spending habits I got used to, I’ve been able to keep more money in my pocket each month,” said Joe Busch, a remote worker.
Fewer people are working in offices, schools, and more has caused a domino effect. Now dry cleaners are seeing fewer customers, small businesses are hurting from the decrease in customers coming in and buying food throughout their days, less public transportation workers are needed, and the effects are astronomical. Working from home has reduced spending in city centers by 5 to 10 percent.
Because so many workers are able to stay home, saving themselves that commute, transportation companies are hurting from the decrease in ticket sales and gas being bought. Declines of more than 60% have been observed on buses, trains, and planes. Any simple change can affect the economy in a domino effect.
Due to the decrease in commuters, changes in traffic flow can be seen as well. Because there are significantly fewer people on the roads, especially during what was once rush hour times, one can see a noticeable difference in commute time.
Another aspect that working from home has affected is the need for child care. Because some people are able to stay home and work, they do not need to pay for babysitters or daycare facilities, saving themselves that costly expense. Childcare costs in the United States steadily increased until 2020, peaking at $8,000 a year, then dropping post-pandemic.
“For three days a week of babysitting, it costs me and my wife who both work full time $1,600 a month,” said Michael Frank, father and full-time worker.
Since he and his wife are both full-time teachers for 10 months of the year, taking that monthly expense and multiplying it by 10, it costs them about $16,000 a year on childcare alone. If they worked 12 months out of the year as many people do, it would cost them $3,200 more a year.
People who work fully remotely are essentially able to live anywhere they want. Some may have a job in a state that pays higher wages and live in a state where the cost of living is lower. There are so many different ways remote work has affected people’s lives and the economy.
“Living costs are much lower when you’re living in a more rural area than when living in the city, many workers have ended up moving into less expensive communities,” said John Kane, SUNY Oswego economics professor.
Working from home has become the new norm and the effects have been noticeable within the economy.