27 Nov. 2017 | Comments (1)

Has teleworking peaked? Not according to the data.

“In 2006-2016, one quarter of the growth in the number of full-time employees came from those working primarily from home.”

 

In the past couple of years, several well-known corporations made high profile decisions to limit teleworking. That led to broader debate and some re-thinking of the pros and cons of teleworking.

But the latest data from the American Community Survey (ACS) suggests that through 2016, the trend of shifting towards teleworking is not slowing down, but rather accelerating.[1] In every year since 2005, the share of full-time employees primarily working from home has increased.[2] According to the ACS, in the decade between 2006 and 2016, the number of full-time employees increased by 7 million—and new teleworkers accounted for one-quarter of that growth.

 

Chart 1: The growth in teleworking is not slowing down, but rather accelerating.

Share of full-time teleworkers in the US, 2001 to 2016.

Share of full-time teleworkers in the US, 2001 to 2016.

Source: American Community Survey; IPUMS-USA, University of Minnesota, www.ipums.org

 

In 2016, the US labor market reached unprecedented growth in the share of teleworking, after strong growth in 2015 as well, reaching 3.1 percent of total full-time employees. While two years do not necessarily constitute a new trend, if this is the start of a takeoff in working from home, it is worth asking what the cause could be. The tight labor market is certainly a prime suspect. With advanced remote working technologies reaching new prevalence, employers facing a tight labor market can now more easily utilize teleworking to broaden the pool of potential workers and perhaps avoid having to offer higher pay instead. As long as tight labor market conditions prevail, teleworking should continuing growing quickly.

The overall share of full-time employees working primarily from home, 3.1 percent, may not sound like much, but the share differs widely across occupations. While in most occupations, hardly anyone works primarily from home, there are many occupations with far above the average share of teleworking employees. Chart 2 uses a more granular occupation classification to show some of the specific occupations (according to the ACS OCC code) with the highest share of teleworkers. The occupations with currently the highest share of full-time teleworkers are medical transcriptionists (41.7 percent), sales engineers (23.4 percent), and travel agents (21.6 percent). Many of the occupations with high shares of teleworkers are computer-related jobs, and most require a college degree.

 

Chart 2: Working primarily from home is very common in some occupations.

Share of full-time teleworkers in the US by ACS OCC occupation, average of 2014 to 2016.

Share of full-time teleworkers in the US by ACS OCC occupation, average of 2014 to 2016.

Source: American Community Survey; IPUMS-USA, University of Minnesota, www.ipums.org

Note: The ACS OCC coding for occupations was used.

 

The overall trend of the growing share of teleworkers is even more impressive for some groups of occupations. In chart 3, groups of occupations (3-digit SOC code) that experienced significant growth between 2001 and 2016 in the share of teleworkers are shown. Among full-time employees in 2001, almost no engineers or lawyers worked primarily from home. In 2016, more than three percent did. In 2001 just over two percent of employees in computer-related occupations worked primarily from home versus close to nine percent in 2016.

 

Chart 3: In some occupations teleworking is growing rapidly.

Share of full-time teleworkers in the US by SOC 3-digit occupation, 2001 and 2016.

Share of full-time teleworkers in the US by SOC 3-digit occupation, 2001 and 2016.

Source: American Community Survey; IPUMS-USA, University of Minnesota, www.ipums.org

Note: The Standard Occupation Classification (SOC) was used to group workers in occupations. 3-digit level occupations shown here.

 

Decisions to allow for teleworking will differ among firms, but generally the following determinants seem to increase the probability of teleworking: the ability to accurately monitor the employee, the frequency of travelling (more days on the road means fewer days at the office), the comfort of the typical employee with advanced remote working technology, the need for a quiet working space, the independence of the task, and the reduced importance of sitting with colleagues in the same physical space. In some occupations, the growth in teleworking is becoming one of the most important work-related trends. We expect working from home will only gain more importance in the future.


[1] In this blog we define teleworkers as full-time employees, excluding part-time workers, self-employed, and people in military occupations, who responded to an ACS question that they work primarily from home.

[2] Some of the growth in the share of teleworkers may not strictly come from shifting job locations from offices to homes. Some of the growth could be a result of industry compositional changes or changes in self-employment classification.

  • About the Author: Gad Levanon, Ph.D.

    Gad Levanon, Ph.D.

    Gad Levanon is chief economist, North America for The Conference Board, where he oversees the labor market, US forecasting, and Help Wanted OnLine© programs. His research focuses on trends in US …

    Full Bio | More from Gad Levanon, Ph.D.

  • About the Author: Frank Steemers

    Frank Steemers

    Frank Steemers is an Associate Economist at The Conference Board and mainly involved in the analysis of the United States labor market. Based in New York he conducts statistical and descriptive analys…

    Full Bio | More from Frank Steemers

     

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  1. Steve Hunt 0 people like this 28 Nov. 2017 09:14 AM

    Great article on a very significant trend that has major implications for staffing and management practices. Removing "location" from job qualifications opens up an entirely different candidate pool. And effectively managing virtual workers requires a different set of skills and processes than those used for on-site work. Traditional management mindsets like "managing by walking around" don't work if your direct reports live in 5 different cities.