Who on Earth can work from home?

 

The COVID-19 pandemic has changed the way we think about working from home. But the situation varies widely depending on a country’s income level and type of economy, as well as availability of critical infrastructure, in this case the internet. Well, what was your motivation to read this search and what do you find?

 

The road out of poverty passes through finding well-paying, secure and productive employment. The World Bank then constantly asks- how health outcomes and education would impact labor markets, and how infrastructure or macroeconomic policies would affect labor market outcomes across the world. And what the impact is on inequality.

 

 

When COVID-19 hit, the organisation wanted to measure the impact of the pandemic on labor markets and how it differs across countries. Policy makers need to counter negative effects inflicted by shutdowns, social distancing, and other efforts to contain the disease, and understanding whether jobs can be performed from home helps to determine labor market vulnerability. Also, many governments in developed countries enforced lockdowns to contain the virus, but I question the feasibility of doing the same in low-income countries.

 

There already are several papers that have come out, but many focus on high-income countries with less emphasis on low-income countries. Let's start by applying the metrics the World Bank used to low-income countries, examining the type of tasks carried out by the worker, and explor the extent of working from home in developing countries. Being this, there arises one certain question that how access to infrastructure, in this case the internet, affects labor markets. Before COVID-19, search on remote work looked mostly at the composition of work and types of jobs across countries. Failing to account for internet access causes overestimation of the number of jobs that could be performed from home across the globe by around 27 per cent on average.

 

The disparity found is striking- In high-income countries, it’s 1 in 3 jobs that can be done from home while in low-income countries it’s only 1 in 26 jobs. The overall labor market burden of COVID-19 is bound to be larger in poor countries, where only a small share of workers can work from home and social protection systems are weaker. In terms of income inequality, the search notes that the type of job one has and their access to the internet matter a lot. And there are big differences across the world or within countries. In high-income countries, where the internet is readily available, the type of job matters more. Educated people tend to have high-skilled jobs that are amenable to working from home. Low-skilled jobs that are temporary or noncontractual are hit harder.

 

 

In developing countries, the internet is more relevant because access is highly unequal across income groups, education group levels and geographic regions. Lack of internet access creates another layer of distributional inequality, especially in middle-income countries. While rich people tend to have internet access, poor people may not have access at home. Even if you are a relatively well- educated person whose job can be done from home, internet access determines your fate. On the other hand, in low-income countries where internet access is limited, the situation is somewhat reversed. The majority of people work in low-skilled service jobs like agriculture, and people with high-skilled jobs who depend on internet access in the office are generally most affected.

 

The digital divide is certainly not a new concern, but the working paper underscores the significance of ICT infrastructure during this pandemic for labor market outcomes. How are you taking this search forward? This shows us what kind of data we should be collecting and how. Nobody would have guessed, that the organisation would be in this situation but it’s important to enable us to answer questions on how to address the impacts of COVID-19.