A Surge In Telecommuting Could Jeopardize Economic Growth

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A Surge In Telecommuting Could Jeopardize Economic Growth
Will more people working from home help or hurt the economy?
SHOW TRANSCRIPT

Google, Twitter, and Coinbase are just some major US corporations that have already urged workers to telecommute as a way to slow the spread of coronavirus. But if telecommuting takes off more broadly as the disease spreads, it could threaten a key part of America’s economy: consumer spending.

“Consumer spending is really what’s been the big thing that’s been keeping the economy afloat,” said Lenore Hawkins, chief macro strategist at Tematica Research. 

If more people work from home to avoid getting sick, they might also limit their trips outside to run errands or fill up their gas tank. That could spell trouble for the economy, considering consumer spending accounts for 70% of U.S. GDP. 

“That’s also been keeping the rest of the world going, because our economy has been doing a hell of a lot better than the rest of the world. So that kind of spirals — the worse that the U.S. does, the worse everyone else does,” Hawkins said. 

The good news is several studies show workers are still efficient when they’re at home instead of in the office. And advanced technology has allowed for telecom apps like Zoom and messaging platforms like Slack to keep everyone connected in ways that weren’t possible before. 

“This could be more an opportunity for organizations and individuals to rethink how work is done to become more productive,” said Brooks Holtom, professor of management at Georgetown University’s McDonough School of Business. 

But there’s something else to consider: working from home is not possible for everyone. 

“Hospitality, service industry, people who cut your hair; those types of jobs don’t lend themselves to telecommuting,” Holtom said. 

For those workers who cannot stay home, their safety could depend on protective measures their employers enact to prevent workplace outbreaks.