Oregon Office of Economic Analysis

While there has been no pandemic-related migration boom in Oregon, one of the most commonly cited reasons for it in the first place was the rise of working from home (WFH). It is true that WFH did become noticeably more prevalent during the pandemic, directly because of the pandemic as firms sent workers home to try and get as much work accomplished while limiting in-person interactions and slowing the spread of the virus. The open question is just how much WFH will increase in the years ahead, and what impacts it may have on population growth, commercial districts, housing markets and the like.

The WFH revolutionists may very well be right as the potential to reshape the landscape is clearly there. However we do not have the hard data to really confirm it is happening just yet. We know much of the initial increases last year were really about sheltering in place. There hasn’t been enough time to really see what the working landscape looks like post-pandemic because the pandemic isn’t over. An important thing to keep in mind is that we’re nearly two years into this thing. Even if something was originally thought to be temporary, the longer it goes on, the higher the probability of permanent shifts. And only then, once workers get a clearer picture of their employer’s expectations and plans would we tend to see larger life changes like WFH-related migration.

With that preamble said, let’s dig into the latest data.

To start, it’s important to note that in the past 18 months WFH has been steadily declining. Workers who were sent home during the initial shutdowns have slowly been returning to the office. Nationally, telecommuting due to the pandemic has fallen from 35% of the workforce back in May 2020 to 11% in November 2021. Similar patterns are seen among the largely office-based professional and business services industry. While Oregon’s data is noisier due to a smaller sample size, the state is certainly following national trends overall.

Now, the data above comes from a new question BLS has been asking during the pandemic when they conduct the monthly household survey. It specifically asks about telecommuting due to the pandemic itself, and is not supposed to be a question about telecommuting in general. That means there is certainly some gray area, particularly if WFH was originally about the pandemic but is now being incorporated more into standard business practices.

To get a better sense of WFH more broadly, we turn to the American Community Survey data. Here we see a large increase last year. Nationally the share of the workforce WFH increased 10.1 percentage points, which is nearly tripling the share working at home back in 2019. All three West Coast states rank among the Top 10 nationally and all three saw above-average increases last year.

Three things to note here.

One, the 2020 ACS figures are noticeably lower than what the BLS data indicated by about 6 percentage points on an annual average basis. That’s a significant difference.

Two, as discussed before, WFH is limited to about 1 in 3 workers who can theoretically work from home. These are, generally speaking, white-collar type jobs filled by college-educated workers. There is a clear divide among who can and cannot WFH. At least 2 in 3 workers need to physically be at a workplace to build buildings, provide care, cook meals, and the like. So there is an upper bound on just how prevalent WFH is and can become. Even last year, only 1 in 6 workers nationally worked at home while it was more like 1 in 5 on the West Coast.

Three, even at these relatively small percentages, the total number of workers is still big. In Oregon, the increase in the number working from home from 2019 to 2020 was 211,000. That’s a number that is larger than the entire pre-pandemic labor force of either the Eugene MSA (Lane) or Salem MSA (Marion and Polk). In fact only Multnomah and Washington counties have labor forces larger than the increase in WFH last year. It’s here, when you think of it this way that you can see the potential for large changes in the years ahead depending upon where firms land in terms of pure remote work versus hybrid models of a few days at home and a few in the office.

What’s interesting to see and probably shouldn’t be a surprise is that WFH so far during the pandemic has really been more about sheltering in place. It’s really about office-based workers in large cities working from home. Along the West Coast, workers in the cities of Portland, San Francisco, and Seattle all saw their WFH shares increase 20-30%. Their suburban counterparts saw above-average increases as well. However the small and medium sized metros and rural areas of West Coast states all saw below-average increases in WFH last year.

Digging further into the Oregon data shows that all of the PUMAs — public use microdata areas which are geographies of about 100,000 population — with above-average gains were in the Portland area, plus Linn-Benton which we know has a lot of commuting activity throughout the Willamette Valley. Other regions of the state saw increases, but ones that were smaller than the national average. I’m unsure to what degree the devastating 2020 wildfires may have impacted the WFH numbers in places like southern Oregon and outside Eugene (“Lane, Other”) and Salem (“Marion, Other”).

One other item that stood out in the scatterplot above is that Deschutes County (Bend MSA), which is one of the highest WFH places in the entire country, experienced a below-average increase last year. It got me thinking about the other Zoom Towns. It’s interesting to see that Missoula’s increase in WFH was about average as well. Truckee is a different story, where there was a very large increase, likely due to spillover from the Bay Area. In broad strokes, much of the pandemic era data points toward trends being a bit different in NYC and SF than in the rest of the country, which would also fit with these Zoom Town patterns as well. That said, in 2 of the Zoom Towns it’s interesting to see that WFH did not exactly skyrocket.

All of this, with Truckee being a possible exception, is an indication that any broader impacts of WFH in terms of migration and the like hasn’t happened yet. It very well may in the future, but we really need to see what WFH policies look like in the years ahead to get a better understanding of how and where the landscape will change.

If you put it all together, here is what our current projection for WFH looks like in Oregon. This updated outlook incorporates the latest ACS figures, BLS trends in 2021, and some academic and business research on the expected increases in the years ahead.

Expectations are there will be fundamental gains in WFH as it becomes a larger part of standard business practices. We know that in 2018, Oregon businesses offered the ability to telecommute to 15% of full-time positions and 7% for part-time positions, according to our friends at the Oregon Employment Department’s survey of employer-provided benefits. Those numbers will increase moving forward.

Bottom Line: It’s important to keep in mind that WFH is an opportunity for a select segment of the workforce. Depending upon where firms land on the hybrid model vs pure remote will likely go a long way to determining how WFH shapes our communities, the economy, commercial districts, housing markets and the like. Today, WFH is on the decline as workers are recalled to the office, which should boost downtowns and job centers more broadly. However in the years ahead WFH will be in the ascent. To what degree remains an open question. Encouragingly we know that WFH diversifies our regional economies and that nearly all of Oregon is above-average in WFH and broadband access. This means that if the WFH revolution does come, it has the potential to boost all regions of the state. And given overall population and economic growth, WFH does not mean that urban cores are stagnant in the years ahead either. New firms and residents, some of which may migrate here because of WFH opportunities at their previous location, will continue to move to, and live and work in Oregon.