🔮 Remote disparities and 2024 predictions

Good Morning,

There have been plenty of year-in-review articles about remote work lately, and it was fun to dive into them this week.

Remote work is here to stay - but you know that. These articles are reflective on the progress that’s been made and the data that’s been measured, with an eye toward the future.

It feels as though the battle for occasional remote work has clearly been won, but the “war” is far from over. In certain industries, roles, cities, and even pay grades, there are big differences in remote opportunities where there really shouldn’t be.

And what are the second order effects of the inevitable rise of remote work? It can be both fun and stressful to imagine. Some experts share their predictions below.

Remote Source Job Board

Featured companies:

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OutSystems: 20 remote jobs
Discord: 37 remote jobs

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Need to Know

📆 More companies offered remote work in 2023
The number of US companies offering flexible work increased from 51% to 62% over the course of 2023, according to Flex Index’s Q4 Report.

According to the report, the following industries are the ones with the most companies offering flexible work:

• Technology: 97%

• Media & Entertainment: 92%

• Insurance: 91%

• Professional Services: 87%

• Financial Services: 87%

And the following are the metro areas with the most companies offering flexible work:

• San Jose, CA: 93%

• San Francisco, CA: 92%

• Austin, TX: 91%

• Seattle, WA: 89%

• Boston, MA: 89%

And way down at the bottom of the list, the least flexible metros are: Chattanooga, TN; Knoxville, TN; Wichita, KS; Lexington, KY; and Lakeland, FL. What’s going on in Tennessee? For the full report, with all industry and metro rankings, take this link to the Flex Index and submit your email address. (Flex Index)

🧑‍🎓 Inequality among remote work offers
A group of researchers looked into job posting data to better understand the divide between those who are typically offered remote work and those who aren’t, as this inequality raises concerns for management teams. The researchers found positive correlations between remote work offers and the following: increased pay, increased educational requirements, and increased experience requirements.

These numbers prove what many job seekers and hiring managers have suspected to be true: the more valuable a person is to an organization, the more likely the organization is to give them the ability to work remotely. (Harvard Business Review)

🚎 The biggest winners and losers of increased remote work
With every passing month, we’re better able to understand the long-term pros and cons of remote work.

The biggest losers:

• City-center office and retail property owners. Many offices remain half-filled, and will take a long time to recover as office leases expire and new office policies and co-working structures are developed.

• Mass-transit rail systems. Now that hybrid work has leveled out, ridership has settled at 30% below its pre-pandemic levels. Federal and state subsidies have helped prop up these revenue shortfalls, but in the long run, the reduced ridership will have further substantial impact on local economies.

• Big cities. There has been considerable exodus from major city centers, leading to a drop in tax revenues. For this reason and those previously listed, local governments will need to make considerable budget cuts that could have devastating impacts.

The biggest winners:

• Workers. People overwhelmingly want flexible work options, and they assign high financial value to (1) less time commuting, and (2) more time spent how they please.

• The environment. Two days of WFH per week reduces pollution by 15%. Further, fewer commuters means traffic speeds during rush hours have increased (as we covered in the December 11th issue).

• Companies. Remote organizations see positive financial impact from (1) hiring remote talent, and (2) higher retention rates. Plus, profitability has surged for a number of reasons in the last several years, but widespread adoption of hybrid schedules seems to indicate remote work is at least part of that increase.

Nobody wants to see energetic cities in decline. It will be interesting to see how local governments adapt to account for a future where remote work continues to become more prevalent. (Wall Street Journal)

💸 Banks could lose $160B from office space defaults
We know commercial real estate values are dropping, as McKinsey shared this summer. But the added consequence of that devaluation is banks losing money on the loans they made to those property owners.

When those real estate owners default, as they have begun doing already, the result will likely be $80-160 billion in total losses.

The Financial Stability Oversight Council - put in place in the wake of The Great Recession - released its annual report last week, naming CRE exposures and concentrations as top financial risks to our national economy that need to be closely monitored.

For a deep dive, head to page 18 of the FSOC annual report here; otherwise, just know that commercial real estate is the largest loan category for almost half of banks nationwide, and the potential impact of these defaults fortunately has a lot more attention than mortgage-backed security defaults did in 2007. (New York Post)

🔮 2024 predictions from experts:

• Barbara Larson, executive professor of management at Northeastern University, says companies have been too focused on broadly implementing strict office requirements. The “clear next step” is more nuanced policies that don’t apply to every employee in a given category.

• Julia Pollak, Chief Economist at ZipRecruiter, says there will be a slow increase in remote work from here on out: “I think the numbers will gradually go up as this becomes more of an accepted norm, as future generations grow up with it being so widely available, and as the technology for for doing it gets better.”

• Julia Pollak further states that business investments have been slower/paused for the last ~18 months but should pick up in 2024. When that happens, there will be greater investment in the technology that supports remote and hybrid work.

• Stephan Meier, professor of business at Columbia University, expects office spaces to change in two ways. First, employee purpose: “If you go into the office, it should be all collaboration and social interaction. Once we figure that out, I think there is going to be an advantage to a hybrid workplace compared to a work where everybody comes to the office five days a week.” Second, building conversions: he expects more cities to adjust zoning laws in order to facilitate conversions from old office buildings to apartment complexes.

The new technology to support remote work will be incredible to see in 2024. Many major tech companies have been testing AI connectivity software internally - some of which I’ve seen, and it’s mind-blowing. It will be interesting to see whether that helps management justify additional time spent away from the office. (Yahoo! Finance)

Stuff We Like

• CrackedDevs
  Found this awesome remote job board last week (link above), built specifically for remote developer roles. And if you subscribe to their newsletter (link below) they’ll send job updates directly to your inbox as well.

• Stop overworking after vacations 👀
  Keep this Harvard Business Review headline in mind and don’t swing the pendulum back to work too strongly, lest you start 2024 on a fast track to burnout.

• Free Stanford Courses
  Did you know some universities offer free online courses? Stanford isn’t unique in this, but they have some of the best credentials. If you need a quick refresher or resume boost as hiring takes off in January, these courses could be a great way to stand out.

Enjoy your New Years celebrations this week! And remember to pour one out for any Florida State football fans.

We’ll catch back up with you on Tuesday, January 2nd.

Cheers 🥂
Grant

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