Remote working and the new geography of local service spending

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

No 17431, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Remote working, at least some of the time, has rapidly become the new norm in many sectors. Remote working changes where workers spend much of their time, and because of this, it also changes the geographical location of demand, particularly in sectors which supply local personal services (LPS). We quantify this change for England and Wales. To do this, we use a bespoke, nationally representative, survey of nearly 35,000 working age adults, which predicts long-term changes in remote working and in LPS spending while at work. On average, we find that a neighbourhood to which people commute 20% less often experiences a decline in LPS spending of 7%. There is a clear geographic pattern to these spending changes: large decreases in LPS demand are concentrated in a small number of city-centre neighbourhoods, while increases in LPS demand are more uniformly distributed. Further analysis of neighbourhoods geographical and socio-demographic characteristics shows the least affluent neighbourhoods see least benefit from remote work.

Keywords: Remote working; Work-from-home; Local labour markets; Local personal services; Retail industry; Hospitality industry (search for similar items in EconPapers)
JEL-codes: H12 J01 R12 (search for similar items in EconPapers)
Date: 2022-07
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