Protect Your Rights: Navigating the Challenges of Working from Home
“I hope to work from home full-time,” I confided to my boyfriend just a week after landing my dream job. With a staggering distance of 2352 miles between us, a 5-hour flight, and expensive airfare of $700, I’m not alone in facing the challenge of a long-distance relationship after graduation. Studies reveal that 75% of the 4.43 million college graduates in the US face a similar predicament (Shimkus, Hanson). However, this is not just a matter of romance. Even among couples with college degrees, nearly 50% live over 30 miles away from both mothers, with only 18% living within 30 miles of both (Compton & Pollak). As the population ages, couples delay fertility schedules, and the middle-aged face growing responsibilities to care for their aging parents, working from home has become an increasingly attractive option for many.
My perspective on working from home completely changed in the fall of 2022, thanks to a seminar by Professor Matthew Kahn, a renowned urban economist at the University of Southern California. During the seminar, I was introduced to his groundbreaking book — “Going Remote” — which unveiled the hidden potential of WFH as a natural social experiment that tests its compatibility with our current world. After reading it thoroughly, I was amazed at how it provided a practical guide to transition from a traditional office-based work environment to a remote setup. In this “new normal” of WFH, employees enjoy flexibility, employers cut costs, and underdeveloped cities catch up. Long-distance couples are reunited, and middle-aged workers no longer feel sandwiched between their parents and children. I envisioned megacities with lighter traffic and lower rents, making housing more affordable for low-income families. I saw new service jobs emerging in beautiful locations and sustainable housing and infrastructure being built in less developed areas. However, though these prospects elated my optimistic and idealistic mindset, my rationality reminded me that challenges lay ahead.
Indeed, while the book presented a compelling vision for the future of WFH, I hold a more cautious and pessimistic view of the challenges that lie ahead. I question whether WFH is potent enough for post-industrial cities to regain their allure and for current megacities to experience lower rents. Additionally, I am uncertain about how many people would be willing to move and to where if infrastructures in new cities wait to be built, which could prolong the process indefinitely. The more I delved into the book’s content, the more questions surfaced in my mind.
While numerous unresolved issues surround the WFH “new normal,” one of the most pressing concerns is the protection of workers’ rights. The pandemic has sparked fears among WFH employees about losing their jobs, and these anxieties persist even as the pandemic recedes. In 2020, a survey of 2300 verified professionals revealed that almost half (49%) were worried about job insecurity due to remote work (Daniel). Later in 2022, a CNBC workforce survey indicated that remote workers in the US labor force are the most likely to fear layoffs and struggle to find new employment opportunities quickly (Rosenbaum). As the rest of the passage will demonstrate, these concerns about job loss are not unfounded under rising risks from offshoring and instability. Before we head into the WFH “new normal,” let us consider together what these negative consequences are and how we can protect our rights.
One of the primary concerns related to WFH is the increasing risk of unemployment caused by “white-collar offshoring.” Although offshoring has been a trend in the US for decades, WFH has enabled companies to offshore not only unskilled labor but also professional, technical, educated, and well-paid high-skill workers. The middle-class and affluent professionals in the US are now competing with highly skilled workers in India, China, Korea, and other countries, creating a situation where someone in those countries is becoming more substitutable for one in the US. Since living expenses and average income are higher in the US, we are comparatively disadvantaged in this profit-maximizing capitalism. Professor Kahn has similarly acknowledged that as labor costs are the major expenditure category for firms, US workers face downward wage pressure (Kahn). To address this issue, he suggested two remedies: 1) moving to a cheaper location where rents are lower and 2) investing in new skills to stand out in the competition (Kahn). However, both solutions have their challenges. Relocating to a cheaper location isn’t as easy as it sounds. We have to consider various factors such as our partner’s job, children’s education, and taking care of elderly parents. The efficient market theory also points out that these cheaper areas may have inferior infrastructure, such as inadequate hospitals, schools, and poor internet quality that cannot support remote work. Moreover, moving within the US doesn’t guarantee substantial savings, leaving US workers still at a disadvantage compared to those in other countries who can work for lower wages. Investing in new skills is a solution, but it can be expensive and not exclusive to US workers. The global market already has a plethora of skilled workers, and there is no escaping competition once WFH opens up opportunities.
Professor Kahn proposes an indirect solution to the challenges faced by WFH workers in another book chapter, highlighting the advantages of the gig economy. He argues that by accessing remote job positions through moonlight platforms such as Upwork, unemployed individuals can mitigate the risks of local “boom/bust” cycles and reduce the likelihood of unemployment (Kahn). Truly, recent apps have demonstrated that contingent work can substitute unemployment insurance, lowering optimal UI replacement rates for traditional workers from 48% to 41% (Kass). However, while gig work can provide a temporary solution, contingent workers’ hourly wages are typically 11.5% lower than those of traditional employees, making it difficult for them to maintain their previous living standards in the long run (Kass). Furthermore, irrespective of their job title, gig workers are often categorized as independent contractors instead of employees, which deprives them of essential rights, such as a minimum wage, overtime pay, and a secure and safe work environment (Well). They are also left without protection against discrimination, unemployment insurance, workers’ compensation, and paid sick leave, which are mandatory in most states (Well). Ultimately, to achieve financial stability, unemployed individuals must eventually return to the global labor market and compete within the world pool of workers for stable, full-time jobs.
As “white-collar offshoring” poses an increasing threat to highly skilled American workers, WFH arrangements also make our jobs less secure. Professor Kahn’s book fails to acknowledge that flexibility is a double-edged sword: we have it, and so do the hirers. Following the trend of offshoring, companies can quickly replace employees with cheaper labor from other regions or countries. The expectation of working in-person or from home can also change abruptly, causing instability of jobs. Three years after the first adoption of WFH, on February 17, 2023, Amazon CEO Andy Jassy announced that employees would be required to work in the office for at least three days a week starting May 1 (Bowman). This sudden shift led to backlash from Amazon employees, who began a petition urging Jassy to cancel the return-to-office (RTO) mandate and allow for continued remote work (Serrano). As Professor Kahn points out in his book, one of the critical advantages of remote work is the ability for workers to choose where they live, irrespective of where their jobs are located (Kahn). The unexpected change from WFH to RTO can create significant difficulties for workers who, in expectation of a permanent remote work arrangement, have sold their homes in urban areas where their companies are located and moved to areas with fewer job opportunities. In the case of Amazon, many employees trusted previous statements that allowed individual teams to decide the number of days to work from home and have planned for a life where their employer wouldn’t force them to return to the office (Serrano). Even worse, based on a survey of 1500 companies, 39% of them said that they will or plan to fire employees who refuse to return to the office full-time (Digital.com). Given there is no requirement for severance pay under the Fair Labor Standards Act (FLSA), we are left vulnerable to the whims of powerful companies.
Facing unemployment risks and instability of jobs, how can we be safeguarded under the “new normal” of WFH? Indeed, many things can be done by the government, and it is imperative that we take action to urge them to move. First, to address “white-collar offshoring,” the government could support us in acquiring new skills and improving our competitiveness in the global labor market. One approach is to invest in education and training programs, such as partnering with businesses that provide those courses. Another approach is to provide financial assistance to workers who are seeking to acquire new skills. For example, the government could offer tax credits or other incentives to employers who provide training opportunities to their workers. Additionally, the government could offer grants or loans to workers who want to pursue training or education programs that will help them acquire new skills. Second, to ensure the stability of jobs, the government could increase the cost of laying off employees by transitioning from free-will contracts to annual contracts or establishing minimum severance pay requirements. To avoid unexpected changes in work mode, the government should also urge companies to establish clear policies around remote work and in-person work, such as fixed timeframes and detailed rules around relocation.
However, setting aside whether the government will enforce these regulations, I am concerned that they will impose excessive costs on firms and cause them to cancel the WFH model as many of them already have. Therefore, it is crucial for economists like Professor Kahn to gain a better understanding of the combined impact of WFH and such regulations and make more accurate projections before we fully embrace this promising “new normal.” One approach to achieving this is examining past data as more become available. For instance, economists can compare changes in productivity among companies that have fully adopted WFH, partially adopted it, or rejected it by industry, occupation, state, and other criteria in order to draw conclusions on the effects of WFH for different groups of people. Moreover, economists can distribute surveys to companies or conduct experiments to assess the combined impact of WFH and new regulations. With the collaboration of employees, economists, and governmental institutions, I am confident that we can achieve a smooth and early transition to the WFH “new normal” while ensuring job security and stability for all.
Works Cited
Bowman, E. (2023, 2 17). Amazon will send workers back to the office under a hybrid work model. Retrieved from NPR: https://www.npr.org/2023/02/17/1158102101/amazon-office-remote-work
Compton, J., & Pollak, R. A. (2013). Proximity and Coresidence of Adult Children and Their Parents in the United States: Description and Correlates. IZA Discussion Paper, №7431.
Daniel, E. (2020, 10 27). Nearly half of professionals fear job insecurity due to remote working. Retrieved from Verdict: https://www.verdict.co.uk/job-insecurity/
Digital.com Staff (2021, 6 9). 4 in 10 employers will fire workers who won’t return on-side. Retrieved from digital.com: https://digital.com/39-percent-of-employers-will-fire-workers-refusing-to-come-in-to-work/
Hanson, M. (2022, 7 26). College Enrollment & Student Demographic Statistics. Retrieved from Education Data Initiative: https://educationdata.org/college-enrollment-statistics#:~:text=4.43%20million%20college%20students%20graduated,20.8%25%20earned%20master's%20degrees.
Kahn, M. E. (2022). Going Remote. Oakland, California: University of California Press.
Kass, T. (2022, 4 14). The Value of Contingent Work. Retrieved from https://tlkass.github.io/TobeyKass_JMP_2022_UMN.pdf
Rosenbaum, E. (2022, 12 21). The latest remote work trend: Fear of being laid off and struggling to find a job. Retrieved from CNBC: https://www.cnbc.com/2022/12/21/the-new-remote-work-trend-fear-of-layoffs-and-not-finding-a-new-job.html
Serrano, J. (2023, 2 22). Amazon Employees Ask Their Boss Not to Make Them Come Back to the Office 3 Days a Week. Retrieved from Gizmodo: https://gizmodo.com/amazon-prime-remote-work-return-office-workers-protest-1850145077
Shimkus, A. (2022, 9 22). Love It or Lose It: Long-Distance in College. Retrieved from Whitman Wire: https://whitmanwire.com/feature/2022/09/22/love-it-or-lose-it-long-distance-in-college/#:~:text=According%20to%20a%20study%20conducted,reported%20at%20below%2060%20percent.
UNC Kenan-Flagler. (2019, 5 8). When companies treat employees fairly, everyone wins. Retrieved from UNC Kenan-Flagler Business School: https://www.kenan-flagler.unc.edu/news/when-companies-treat-employees-fairly-everyone-wins/#:~:text=Lack%20of%20fairness%20in%20the,with%20the%20company%20long%20term.
Well, D. (2023, 1 9). What’s a ‘gig’ job? How it’s legally defined affects workers’ rights and protections. Retrieved from Brandeis Now: https://www.brandeis.edu/now/2023/january/gig-economy-explained.html#:~:text=Regardless%20of%20their%20professional%20status,independent%20contractors%20rather%20than%20employees.
