Is remote work here to stay? An inside look at how this change might affect

If companies allow more of their employees to work from home permanently, businesses will move to city centers, while people will live mainly in the periphery, resulting in lower traffic congestion and lower real estate prices in the city. Will fall

Those are our main findings From a model we built to predict pandemic-induced changes in Los Angeles. Many of these changes began to occur in the spring of 2020, when we began this research. We wanted to build a model that could show the effects of more widespread telecommunications in the long post-pandemic period.

Our model is like an artificial world-Thinking sim city—in which virtual people choose where to live and work. Virtual companies employ workers, while virtual real estate developers provide offices, warehouses and housing, setting prices to match supply with demand.

Using pre-pandemic information about people living and working as well as their commute, we modeled the Los Angeles metropolitan area Economist Matt Delventhal, The model also uses pre-pandemic data on commercial and residential real estate prices.

According to our calculations from the American Community Survey, less than 4% of workers in the Los Angeles metro area telecommuted from 2012 to 2016. today that figure is about 40%, Based on estimates, about a third of workers in Los Angeles have jobs that to be done remotelyOur model predicts three significant long-term effects if teleworking becomes permanent at this stage:

  • Residents would increasingly move from city neighborhoods to suburbs, while companies would move to the center.
  • Average residential and commercial real estate prices will fall in central city locations, while housing prices in the suburbs will rise.
  • Traffic congestion will be reduced everywhere and commuting time will be reduced.

why it matters

The arrival of the pandemic in early 2020 affected the daily lives of millions of American workers and the businesses that employ them.

Working at home, unusual before the pandemic, became a necessity, leading employers and workers to realize Telecom is enjoyable and productive, as a result of Big exodus of people who have become immoral from their employers.

In Los Angeles, telecommunications-led workers increased move to suburbs, raising real estate prices, Our model takes this a step further and assumes that these changes will be entangled.

Maybe this prophecy is coming true. NPR recently reported that from 2020 onwards, homebuyers from cities are buying homes weeding out low-income tenants of the suburbs.

This suggests that our model can be a valuable tool to help business leaders, economists, policy makers and others make informed decisions as they try to understand the far-reaching economic impacts of the pandemic on their cities.

what is not yet known

Any model is a simplification of reality. In our model, all employees and employers are equal. However, the real-life responses of different types of workers and businesses to increased teleworking may differ.

Another important unknown is the ongoing impact of telecommunications on productivity. During the pandemic, employers and workers have not reported substantial productivity losses; If anything, workers have reported being a little more productive at home,

Plus, productivity often benefits from opportunities to build and maintain professional networks. These networks can become weaker as more people spend more time telecommunications.

what will happen next

We continue to look at and study how the increase in telecommuting may affect city centers. For example, barbershops, restaurants and other businesses that have long been concentrated in traditional business districts may need to follow a large exodus of residents to the suburbs or small towns to survive.

However, not every worker or business can relocate. Our latest paper models the distribution of jobs and residents in 4,502 US locations and Explores the emerging wellbeing and income gap Between those who can telework and those who can’t.


Andrey Parkhomenko Assistant Professor of Finance and Business Economics in University of Southern California, eunji kwon is an assistant professor of real estate in University of Cincinnati,

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