Is Working from Home Here to Stay? Evidence from Job Posting Data after the COVID-19 Shock

Abstract

We examine the transition to and persistence of working from home (WFH) by firms after the COVID-19 shock. Using job posting data from a leading online job portal in China and exploiting the COVID-19 pandemic as a quasi-experiment inducing the short-run WFH take-up of firms, we find a substantial and persistent increase in the share of WFH jobs post COVID-19. The WFH share increase in job posting is larger in firms with lower pre-COVIDWFH adoption, consistent with the learning effect from temporary shutdown policies. Firms with greater potential for remote work, measured by the teleworkability index à la Dingel & Neiman (2020), also experience larger increase in WFH job postings. Given that WFH jobs provide higher salaries and have higher educational requirements, our findings suggest that WFH is here to stay and thus have long-term implications on firm productivity and labor market inequality.