Working from home and income inequality: risks of a ‘new normal’ with COVID-19

Abstract

In the current context of the COVID-19 pandemic, working from home (WFH) became of great importance for a large share of employees since it represents the only option to both continue working and minimise the risk of virus exposure. Uncertainty about the duration of the pandemic and future contagion waves even led companies to view WFH as a 'new normal' way of working. Based on influence function regression methods, this paper explores the potential consequences in the labour income distribution related to a long-lasting increase in WFH feasibility among Italian employees. Results show that a positive shift in WFH feasibility would be associated with an increase in average labour income, but this potential benefit would not be equally distributed among employees. Specifically, an increase in the opportunity to WFH would favour male, older, high-educated, and high-paid employees. However, this 'forced innovation' would benefit more employees living in provinces have been more affected by the novel coronavirus. WFH thus risks exacerbating pre-existing inequalities in the labour market, especially if it will not be adequately regulated. As a consequence, this study suggests that policies aimed at alleviating inequality, like income support measures (in the short run) and human capital interventions (in the long run), should play a more important compensating role in the future.

Using demographic data to understand the distribution of H1N1 and COVID-19 pandemics cases among federal entities and municipalities of Mexico

“…High densely populated cities within the same country have shown a grater out brake of COVID-19 than less densely populated cities ( Tira, 2020 ). However, it is important to mention the limitations of the observations presented here since the analysis were made using phew parameters that is, population, km 2 , population density, ccCOVID-19 and dCOVID-19; several other studies have shown the need to focus also on weather differences among regions ( Rashed et al, 2020 ), seasonality ( Smit et al, 2020 ; Carlson et al, 2020 ) and social parameters such as income ( Bonacini, Gallo & Scicchitano, 2020 ).…”

Socioeconomic determinants of mobility responses during the first wave of COVID-19 in Italy: from provinces to neighbourhoods

“…The share of employees in the service sector did not explain much of the variation in mobility changes before the lockdown, but it became an important driver during the reopening as it became positively associated to mobility reductions. A possible explanation is that a large proportion of people working in services were either still working remotely or still not allowed to work [17]. Indeed shops, bars, restaurants and department stores were still closed on the second week of May.…”

Socio-demographic factors associated with self-protecting behavior during the Covid-19 pandemic

“…Other studies have focused on work arrangements such as work from home. Examples include Bonacini et al ( 2021 ), Saltiel ( 2020 ), Okubo ( 2020 ), and Rahman ( 2020 ), which examine the types of occupations and workers that have the ability to work from home and how they have been affected by the Covid-19 pandemic in countries outside the USA. A component of our contribution is linking individual demographics to access to tele-working in the USA.…”