The Geography of Remote Work
We show that cities with higher population density specialize in high-skill service jobs that can be done remotely. The urban and industry bias of remote work potential shaped the COVID-19 pandemic’s economic impact. Many high-skill service workers started to work remotely, withdrawing spending from big-city consumer service industries dependent on their demand. As a result, low-skill service workers in big cities bore most of the recent pandemic’s economic impact. Our findings have broader implications for the distributional consequences of the U.S. economy’s transition to more remote work.
An earlier version of this paper was circulated as “The City Paradox: Skilled Services and Remote Work.” We thank Milena Almagro, Nick Bloom, Joshua Coven, Don Davis, Jonathan Dingel, Ed Glaeser, Caitlin Gorback, Arpit Gupta, and Tommaso Porzio for early comments and help with various data sources. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.