Remote Work and Compensation Inequality

Paul Mizen, Gianni De Fraja, Jesse Matheson, James Rockey, Shivani Taneja and Gregory Thwaites

Discussion Papers from Economic Statistics Centre of Excellence

Abstract: This paper examines how the rise of working-from-home (WFH) affects compensation inequality. Using a novel survey, we find that the option to WFH is highly valued by workers (worth 8% of wages) but concentrated among higher earners, suggesting increased inequality. However, using a simple model where WFH and in-person workers are complements, we show that increased WFH leads to lower wages for WFH workers, potentially offsetting the benefits of WFH. Empirically, workers in WFH-capable occupations experienced 2–7% lower wage growth post-pandemic, consistent with the theory. Overall, we find no change in inequality but a substantial increase in compensation.

Keywords: Remote working; Work-from-home; Inequality; Compensation; Pandemic; Perks (search for similar items in EconPapers)
JEL-codes: J01 R12 (search for similar items in EconPapers)
Date: 2025-04-23
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https://www.repository-escoe.com/id/eprint/63/1/ESCoE%20DP%202025-04.pdf

Related works:
Working Paper: Remote Work and Compensation Inequality (2025)
Working Paper: Remote Work and Compensation Inequality (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:eoe:escoed:escoe-dp-2025-04

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