#America #work #virtual #jobs #economy #travel #crypto #digital #viruscasedemic
“Last Thursday featured good news on the US economy, it is extra strong” — Paul Ebeling
The “digitalization of everything” has increased the potential of individuals, firms, and society while also contributing to a series of inequalities, such as worker pay disparities across many demographics, and the divergence of metropolitan economic outcomes.
Fewer and fewer jobs today require employees to be physically present in their office. Alvin Toffler predicted this in the 1970s and the rise of home offices, writing that homes would 1 day resemble “electronic cottages” that allow people greater work-life balance and a richer family life. That has happened.
Last year’s Q-4 and F-Y growth came in at unexpectedly strong levels In spite of a litany of reasons like Omicron, inflation, impending rate hikes and a kinked supply chain, the America economy finds new ways to defy expectations.
But small businesses, the backbone is struggling. And some of the reasons have to do with remote work.
Now 2yrs into the into the VirusCasedemic, lots of office workers are still working from home offices making good money. It is forcing employers to rethink the nature of the workplace, and how to attract and retain talent.
The impact is particularly acute in big coastal cities, and pushing small businesses to the brink.
In an interview with Goldman Sachs last wk we learned that the sector is being hit by labor shortages, rising prices, and the fear of the virus. And that in New York City, the midtown office buildings normally filled with hundreds of thousands of high-earning professionals remain eerily empty.
Noting, the the city cannot recover economically until these people move back to the city and come back to the office at least part time.
An undeniable piece of that puzzle is working from home. Corporate America’s aggressive embrace of hybrid work arrangements comes with increasingly clear, and negative, economic externalities that are getting harder to ignore.
Well-paid knowledge workers can work from anywhere, but that has downsides for public transportation, housing inflation, and wage earners in service industries like retail, leisure and restaurants.
A lack of ridership threatens the solvency of commuter rails, and raises the specter of higher taxes on everyone. Meanwhile, digital nomads with the financial means are driving up rents and housing prices in hot markets, exacerbating the shortage of affordable stock. And small businesses in empty office districts are suffering from the lack of traffic.
The VirusCasedemic created a reallocation shock, according to Brookings. In NYC, virtual work has come at a significant cost to subways and regional transportation in an economy that’s long been defined by commuter culture.
Taxpayers, whether working from home or not are likely to be called upon to pay higher taxes and fees in an effort to prop up a flagging system.
The shift is great for a certain class of knowledge workers. Remote work has created an new category of long-term travel, and that allowed it to become a digital nomads, and many are leaving NY and moving to Florida.
We are living in the biggest change to travel since the advent of commercial flying, because the entire identity of travel is evolving as millions of people are joining this trend.
A study by human resources firm TINYpulse found that employees in hybrid work arrangements “desire even more social and cultural connection than those who prefer fully in-person and fully remote work” and those with a preference for remote work desired as much social/cultural connection as those who preferred in-person work.
The era of office cubicle culture is a thing of the past. But employees, companies and governments have to acknowledge the longer-term effects from hybrid/remote work in this digital age.
Have a happy, prosperous weekend, Keep the Faith!
