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Remote Work Affect Salaries

Will Remote Work Affect Salaries?

There is no disputing the coronavirus’ impact on the economy and labor market. Economists, healthcare professionals, and others have speculated about the lasting effects of this pandemic. However, one thing that is certain is that millions of workers worldwide have been working from home (WFH) since mid-March. With confirmed cases surpassing 4 million in the U.S. this week, working remote might be a permanent transition. So, how will this shift to remote work affect salaries? It’s a little early to tell, but here is what may happen if this trend continues.

WFH workers are relocating

According to a recent study from Pew Research Center, nearly a fifth of U.S. adults has moved due to COVID-19 or know someone who did. The survey found that 37% of those ages 18 to 29 say they moved, someone moved into their home, or know someone who moved because of the outbreak. Many of these young professionals are relocating away from big cities, such as New York City, and escaping to less populated locations, such as the Midwest. These rural locations offer quiet, wide-open spaces and an affordable cost of living. But will your employer continue to pay your massive big-city salary in cheaper rural areas? Are employers going to start cutting wages for workers that move to regions with a more reasonable cost of living?

The price of the big cities

Living in big metropolitan areas definitely have their appeal – more culture, restaurants, activities, nightlife, and of course, larger salaries. According to a recent study, employers in America’s costliest cities pay at least 40% more for white-collar jobs than the average wage in other regions of the country. For example, a graphic designer makes an average of $31.67 an hour in the top 15 biggest cities versus an average hourly wage of $21.09 in all other regions. Yet, according to the report, “When firms in the highest-priced cities hired workers living in cheaper towns, they tended to pay almost 19% more than the person would earn locally.”

To break this down, workers make more in larger cities, regardless of whether they work locally or remotely. However, that salary range is still enormous. Using the pay scale for a graphic designer, a professional in that field would make 19% more working remotely for a company in a big city. That’s a little more than $4 more an hour, which is a much lower wage than the local workers of big cities making over $10 more an hour.

How will remote work affect wages?

This begs the question: will employers begin to change wages for remote workers to reflect their employees’ cost of living? Facebook is already moving its hiring efforts to focus on remote work to lower its payroll costs. Will other large companies follow through? More professionals working from home may reduce or even fix the insane pay disparity our country faces in some areas. As a result, professionals may consider moving out of expensive cities like NYC and moving to locations with a better quality of life, affordable rents, and overall better happiness ratings.

Time will tell how this virus will ultimately impact our wages across the country. Still, it is worth considering if you are currently working remotely and considering a move to a different region.

How remote work might impact your salary

support your remote workers

How to Support Your Remote Workers

The majority of states have finally started reducing restrictions imposed because of the Coronavirus pandemic. However, millions of workers across the country are still hard at work from their homes. With a large chunk (if not your whole team) working remotely, it’s not easy to offer the same support as you can in the office. Here are a few ways you can support your remote workers.

Set expectations

It’s imperative to set expectations from the very beginning with your entire team. Establish guidelines for everyone and make them crystal clear. Put them in writing and send them to your staff. Setting boundaries and expectations are essential, and doing it early on will reinforce good habits from the get-go. However, please don’t go overboard or it might seem like you don’t trust your staff. Remember, your employees are adults, not children. Guidelines are good for everyone when they are not overbearing.

Build loyalty

Building loyalty and trust in each of your relationships is vital during these challenging times. Now is not the time to micromanage your staff. If you trusted them in the office, you should be able to trust them while working remotely. Trust builds loyalty, and loyalty goes a long way, especially during these uncharted waters. Hold regular meetings, regular check-ins, and be encouraging. Trust us; it will go a long way and support your remote workers.

Take care of each individual

Make sure you take care of each staff member. Not everyone is in the same situation right now. Some are handling the pandemic better than others and have fewer responsibilities at home. Some workers are balancing childcare, schooling, and work, while others may have a partner that is currently unemployed. As a result, ensure each team member is doing well, both mentally and physically.

Also, not everyone has the same work-from-home setting. Make sure each employee is taken care of with their home “office” goes. Some of your employees may need a desk, a new office chair, a second monitor, or other items to make their working hours a little more productive and comfortable. Taking care of your employees during these challenging times will help build much-needed morale.

Emphasize accomplishments not hours

Don’t emphasize the actual hours worked of each employee. Instead, focus on accomplishments. Some of your workers might be flourishing with their new working environment. But on the other hand, some of your staff members may struggle a little more. A recent report illustrated that 54% of workers are more productive at home. That’s great for both workers and employers! However, employees working from home will work an average of 1.4 more days’ worth of hours each month. That translates to 16.8 more days a year. As a result, your team can easily get burnt out as the boundaries of work and home often become blurry. Thus, support your remote workers by focusing on accomplishments, not actual hours worked.

Interested in more management and hiring tips? Explore our client resources for all the information you need!