Outlook on Working Into the New Year

2020 saw some major shifts in the US’s workforce due to COVID-19. Companies implemented work-from-home models, allowing employees to work from just about any location. Some tech-driven industries have seen business boom, while others have been hit hard by COVID restrictions, driving up unemployment. With vaccination rollout commencing, 2021 is sure to bring new changes that could shift us back to normal, or a new normal entirely. 

Projections on Working Remotely:

Last March, working from home felt temporary, but recent projections reveal home offices might be here to stay.  An Upwork survey has shown 1 in 4 Americans will be working remotely in 2021, a statistic that has more than doubled since pre-pandemic times. This is expected to jump to an 87% increase (to 36.2 million) by 2025. Employees and companies cite that working remotely has led to increased productivity, shorter and more efficient meetings, greater autonomy, and better schedule flexibility. 

At the forefront is the tech industry, with major players like Twitter, Square, and Facebook offering employees fully remote opportunities indefinitely while Google has just announced a new hybrid model starting September 2021. 

However, what is likely to be the case post-vaccine? The outlook leans toward a hybrid model with in-person interaction still proving to have major benefits, especially in generating ideas and solutions, as well as allowing for workers to build camaraderie with their peers. A Forbes article states that we will likely see employees return to the office for project kick-offs, team building sessions, and orientations, while the remainder of time will be spent out of the office. Liz Burow, VP at WeWork, elaborates further, “I think you’ll hear a lot more about H.R. departments saying we have ‘no meeting Mondays’ and very clear, intentional days of the week [for different activities].” 

Specifying which days are worked at home and which are in-office will limit flexibility, but may help align team schedules so co-workers can be in-office at the same time. This will likely point to many employees working in “pods” or strictly with their small teams.

Other sectors like manufacturing and financial services have also followed suit with similar “shakeups.” 

In an interview with Carol Sledek, leader of the work-life consulting practice at Aon, The Washington Post writes: 

“She has helped employers in [these industries] craft part-time work policies for managers and professionals — thinking through which benefits they’d keep receiving, how to adjust pay, and how to cover and coordinate the work. While hardly a new idea, [Sledek] said it’s gotten particular attention over the past couple of months as working parents reached a breaking point, and she predicts more employers will follow suit next year. ‘I have a lot of employers coming to me saying [employees want] a four-day workweek,” she said. “This may just be the dawn of the era we’ve been working toward for many years.’”

These new partially- and fully-remote opportunities have also led to an increase in freelance hires. As a result, large cities like New York and San Francisco are seeing a decline in population, with many employees opting to live in locations with cheaper living expenses, taking their remote work with them.  

Struggling Industries & Unemployment:

With many industries seeing perks from these new working conditions, several are still facing uncertainty going into the new year. A report published by McKinsey shows industries like hospitality, including restaurants and hotels, the arts and entertainment, and educational services being hit the hardest. McKinsey projects that recovery may take until 2024, when GDP levels are expected to return to or surpass pre-pandemic levels. Despite the vaccine rollout to most individuals by mid 2021, consumer spending patterns are likely to remain uncertain, spurring delayed reopenings of business in struggling industries. 

Unemployment spiked in 2020, but will start to decline in 2021. IbisWorld projects the overall employment rate to decline to 7.1% in the new year, as businesses reopen and the economy begins to recover. However, the report also anticipates a continuation of 2020’s unemployment for the first half of 2021. 

The COVID vaccine has offered a bright light at the end of such a chaotic year. 2021 will likely improve upon its predecessor. However, change and recovery will take time. As the American people continue to adjust to new working conditions and the economy slowly reopens, let’s hope that we can start our journey toward a new sense of normalcy. 

Additional Resources and Readings:

How manufacturing will forever be changed by COVID

Luxury travel and cruises after the pandemic

4 considerations for employees working remotely in 2021

- by Thomas Boyer, Associate at More Canvas Consulting