The shift in remote work

Telecommuting, or working from home, gained attention in the 1990s and was seen as the future of work. It was enabled through advances in communications and digital technologies and heralded as the answer to the traffic woes of our big cities ^[1].

In NSW, Action for Transport 2010 included initiatives from the State Government to encourage teleworking from regional cities rather than residents doing long car based commutes. Many organisations embedded flexible work into their policies, with hopes of reducing operating costs. However, a widespread culture of remote work was slow to take off, partly explained by management cultures that preference ‘line of sight’, and the appeal of face to face client, and business to business engagement.

Thirty years on, working from home has happened quickly and at scale. Governments responded to the COVID-19 health pandemic by putting in place health orders requiring an employer to allow employees to work at home (where practical to do so). This time, the shift was driven by the need for physical distancing to stop the spread of a highly infectious disease, not by a desire to reduce commuting times or operating costs. This was more difficult for some, however, as many occupations were simply unable to operate remotely.

Benefits and costs are yet to be revealed

For occupations that can be performed remotely, the long term benefits and costs are yet to be revealed.

For workers, foregoing a daily commute has presented opportunities to better balance family responsibilities, improve lifestyles, and offer a greater choice of housing location and affordability. A survey in July 2020 by the National Growth Areas Alliance (NGAA) showed commuting by car to work from outer growth suburbs costs commuter $5.4 billion a year, equivalent to $8,380 each year for a full-time worker ^[2].

Research by SGS for the City of Whittlesea shows women living in growth areas are more likely than men to be tertiary educated, but almost twice as many men are working full time compared with women ^[3]. It is anticipated that greater flexibility and allowing people to work from home could increase women’s workforce participation, particularly in outer suburbs.

For businesses, a move to remote working has reduced the need for floorspace and therefore rent, and increased access to a larger potential workforce. For cities, there is the potential to reduce peak transport congestion, reduce traffic emissions, and revitalise local centres.

There are also downsides associated with risks of isolation, a lack of team engagement and loss of economic activity in city centres. The long term impacts on productivity also remain unclear – reducing face to face interactions and knowledge sharing could, over the long term, result in reduced productivity which may more than offset the gains related to reduced travel.

If remote working continues at an increased rate, there is no doubt that it has the potential to fundamentally reshape the form and structure of our cities.

This article shares new data on the locations where residents are more likely to see ongoing shifts to remote working. SGS has mapped the home locations of people employed in occupations that are most able to work from home, which varies significantly across our capital cities.

This data provides a starting point to understand the locations that are most likely to see an increase in remote working. It provides the basis for understanding the potential opportunities to shift the spatial structure of cities.

How widespread will remote working be into the future?

COVID-19 has shown that remote working can be done at scale. However, the pandemic has also highlighted those industries and workforces that were not able to work from home.

In the UK, nearly half of people in employment were estimated to be working from home in April when the pandemic response was first put in place ^[4]. This marks a significant shift given that prior to the pandemic, less than 30 per cent of people had ever worked from home.

The ABS Household Impacts of COVID-19 Survey found nearly half (46 per cent) of all Australians who were working in late-April to early-May said they were working from home, with women more likely to have been working from home than men (56 per cent compared with 38 per cent) ^[5].

The national Australian Census in 2016 identified that in Greater Sydney, only 4.7 per cent of workers worked from home on census day ^[6]. ABS data shows that professionals (68%) have the highest proportion of people who accessed the internet for home based work on a regular basis for their employer. Machinery operators and drivers (20%) and labourers (17%) had the lowest proportions of home based workers who accessed the internet for home based work.

Which locations have the most residents working from home?

At the national level, some 31 per cent of employed Australians worked from home most days during September (ABS September Household Impacts of COVID-19 Survey), this differed significantly across the country. In Victoria, some 43 per cent of employed persons worked from home, 32 per cent in NSW and 22 per cent for the rest of Australia. This compares to only 12 per cent nationally before restrictions were put in place.

SGS has mapped the percentage of workers across each major city (by home location) who regularly access the internet from home for their employer. By looking at the home locations of employed persons who regularly worked from home before the pandemic, we can start to see those that are most likely to maintain the pattern post-COVID, and have an enduring impact on local places. This will help inform local strategic and place based planning for public space, retail and commercial uses and local transport accessibility.

Generally, the locations with the highest rates of accessing the internet for home based work regularly are also the locations that are seeing the highest house price values and rating low on indicators of rental affordability.

What does remote work mean for future urban policy?

There is now discussion on the medium to longer terms impact of the move to greater remote working on the shape of Australian cities and regions.

Continued remote working presents many policy questions that are demanding further discussion and research, these include:

• Will the ability to work remotely influence household location decisions, and what are the flow on opportunities for population and economic growth in regional Australia?
• Will organisations reduce the amount of floorspace they hold in high value central business districts, and what does this mean for the economic geography of cites?
• How will remote working affect the overall labour productivity, particularly in knowledge intensive sectors which rely on knowledge spillovers, and face to face interactions with clients and other businesses?
• With more people working close to home, will local centres transform with greater food, entertainment, retailing and personal services on offer?
• What changes to our transport networks and services are needed to support more diverse and dispersed travel patterns?
• How will this impact women’s participation in full time employment, particularly those living in outer-suburbs?

What is clear is that the future of work is changing, and there is no one size fits all response. It needs to be tailored in line with industry and business needs, and worker preferences. The future of work will also vary across the diverse places in our cities. We need to continue to bring a spatial lens to urban policy so that our responses take advantages of the opportunities specific to each place. At the same time, we need to continue to improve city performance and access to opportunities for all residents, addressing the growing social and spatial inequalities across cities and regions.

^{METHOD NOTES}

^{SGS combined propensities of workers who regularly use the internet at home – by occupation [ABS 2018, Household Use of Information Technology, 2016-17], to ABS Census 2016 Occupation data [ABS Census 2016, PUR OCCP1Digit MTWP]. This method proposes to maintain the spatial locality of workers by occupation (SA2 level) and reflect the survey information from Household Use of Information Technology, 2016-17.}

^{Data Sources: ABS Census 2016, PUR OCCP1Digit MTWP and ABS 2018, Household Use of Information Technology, 2016-17.}