Workers who have been rejoicing about their ability to log on from anywhere might do well to consider the inverse situation: a worker somewhere else can probably do their job—for cheaper.
That might cost them their job in the long run.
The fact that many jobs that can be done from home can also be done from anywhere around the globe is often missing in the remote work discussion, says Anna Stansbury, an assistant professor of work and organization studies at MIT Sloan School of Management who teaches a course on the future of work.
Companies haven’t yet internationally outsourced many jobs that require higher education, Stansbury tells Fortune, adding that many call center-type jobs, or remote-first jobs like software design or back-end engineering have already been offshored.
But if high-paying white collar jobs can be done remotely, outsourcing them to cheaper areas could “pretty clearly” offer huge savings. The potential for change “would be seismic if all of these well-paid white collar jobs were suddenly outsourced to less rich countries,” she adds.
“If people that code for Google and Facebook were able to live wherever in the U.S. they wanted and [work] for a year and a half without ever going to the office, it seems very, very likely that a lot of companies will be rethinking this longer-term and outsourcing those kinds of jobs that didn’t used to be outsourced,” Stansbury adds.
Be afraid, be very afraid
Stansbury’s not the only person ringing alarm bells on remote work. Experts have said outsourcing remote jobs is a real possibility, one that could fill in the gap of a tight labor market but one that could also not bode well for workers during a recession.
Stansbury cites the research of Richard Baldwin, an economics professor at the Graduate Institute in Geneva, Switzerland. “If you can do your job from home, be scared. Be very scared,” Baldwin said in November. “Because somebody in India or wherever is willing to do it for much less.”
That fear has been well-documented for over a decade, according to an October 2021 National Bureau of Economic Research (NBER) paper by Baldwin and his research partner Jonathan Dingel. In the paper, titled “Telemigration and Development: On the Offshorability of Teleworkable Jobs,” they categorize jobs into one of four groups: highly offshoreable, offshoreable, hard to offshore, and non-offshoreable.
Landing in the “highly offshoreable” category requires “no” answers to just two questions: “Does a person in this occupation need to be physically close to a specific US work location?” and, if not, “Must they be physically close to a work unit?”
In the post-Covid workplace, tasks that can be done remotely will inevitably be done by telemigrants rather than domestic workers, Baldwin and Dingel predict.
To be sure, such a shift is easier said than done. “Social and cultural contexts across countries [make] it less likely that a public relations specialist or a sales engineer located in Hanoi is a perfect substitute for one located in Seattle,” they add.
According to the Washington Post’s analysis of Labor Department data on remote work during the pandemic, “the more a job pays, the easier it is to do remotely,” and the highest-paying industries—like software and internet publishing—have the most remote workers. The lowest-paying jobs, in sectors like retail and food service, are also the least likely to go remote.
In other words, knowledge workers who have greatly enjoyed the chance to work from anywhere may need to prepare for the possibility that their good luck could dry up.
