INDIANAPOLIS – A Ball State University economist predicts work-from-home and hybrid structures are here to stay, permanently.

FOX59/CBS4 spoke with Dr. Michael Hicks, Economist at Ball State to talk about the growing trend of workers seeking a more hybrid and flexible when they’re picking their next career path.

Hoosiers working from home

The economist shared how fewer than 5% of Americans were working remotely (at least one to two days a week) in 2019. That number has grown exponentially to nearly 38 million people working fully remotely and another 32-33 million people working part-time from home (one to four days a week).

A Forbes Advisor study showed that 16% of companies across the country are already operating “fully remotely” without a physical office space.

Dr. Hicks said in Indiana we went from “60,000 or fewer” remote workers in 2019 to well over a million Hoosiers that are at least working one day from home. That equates to about 31% of the workforce.

Effects of the COVID-19 Pandemic

In the interview, the professor spoke about how the COVID-19 Pandemic in 2020 jumpstarted the movement. This was especially because many people had to WFH due to the shutdown.

Zoom and other virtual meeting software companies exploded and allowed businesses and employees to have the same level of output, if not higher than the traditional way of working.

“For many businesses recognizing that meant that the office, physical rent for a downtown office didn’t make sense any longer,” Dr. Hicks said.

“From a business standpoint, the costs were too high. You were asking employees to commute an hour plus each way, and they weren’t as productive when they were at work.”

According to Forbes, the age group most likely to work remotely are those aged 24 to 35. This suggests that the younger workforce values the flexibility offered by the “WFH” concept.

Dr. Hicks echoed the data of the younger generation being attracted to remote work jobs, especially with his background as a professor. He said, “I have 19- to 24-year-olds. The demand for WFH is just enormous from that demographic.”

Pay and education gaps

Being a professor, also allowed Dr. Hicks to see the big role education plays in remote work access. It isn’t a secret that those with higher levels of education have a better shot at securing remote work.

The Forbes study addressed this very idea by stating the educational gap could be a consequence of “the qualities of roles that necessitate postgraduate qualifications, which usually involve cognitive labor that can be done anywhere.”

However, Dr. Hicks also made a good point that about 9% of people working remotely make $35,000/year salary. This is in contrast to about 2/3 of people earning $200,000/year or more working remotely.

The economist said there will likely be a wage premium in the future for those who must work in person in the office, plant or retail facility daily. But for those who WFH, workers may make a little less.

However, the flexibility and benefits of remote work like; no commute, gas, and uniform costs could suffice the pay gap.

Downsides to remote work

For many workers interested in remote work, the benefits are pretty simple; worker flexibility, lower costs and less congestion within the city. However, with the benefits do come certain downsides and even risks for the companies as work-from-home is still in its infancy.

“Human beings are social creatures who generate ideas and learn from one another in close proximity,” Dr Hicks said.

The economist added business executives may argue, “Why instead of just producing independently, we band together to make cities and make businesses to produce a good or service?”

It’s a question experts will have to contemplate for years to come as they work to cultivate collaborative relationships in every workplace from retail to high-tech, even with remote work becoming more prevalent.

Outlook of hybrid and remote work in U.S.

Dr. Hicks believes hybrid and remote work is here to stay in the U.S. and even in Indiana. He added that in the next five to 10 years WFH will shift into more of the majority as the baby boomers and Gen X retire.

This is mainly because the older generation is used to the work office and being on-site.

He said as more Millennials and Gen Z adopt the remote work concept in the next 20, 30 and 40 years it wouldn’t surprise him if at least 2/3 of the Hoosier economy is working remotely, at least part of the time.