ONS estimates suggest that as many as half of London’s working residents are currently working from home. Some have said that this emancipation from the office could provide a real boost to the levelling up agenda, as high-skilled workers turn their back on expensive property in the south for a new home further north. While this is of course possible, is it likely?
Centre for Cities does not believe that fully remote working will persist once the office opens up again. This is mainly because face-to-face interaction plays such an important role in non-routine jobs in particular, ranging from the sparking of new ideas to the building of new relationships and learning on the job — it’s more difficult to learn from others when your only interaction with them is through scheduled Zoom calls.
What does seem more plausible though is that fewer people will go into the office five days a week. There are certain tasks that do benefit from no distractions, and this is where remote working has an edge (so long as a home is distraction free).
This means that even if people commute in less frequently, their jobs are still tied to a particular place. It may be that workers are willing to put up with a longer commute than back in February if they are commuting less frequently. But even this longer commute is unlikely to result in a significant increase in jobs in the North of England — few people will to want to commute that far on a regular basis.
It does however widen the potential commuter belt into London, with homes in Hastings or Grantham becoming relatively more attractive. If this does indeed happen, then there will need to be an associated increase in house building in these areas if there isn’t to be a consequent rise in house prices.
While the inflow of newcomers into such places may push up productivity, it doesn’t do a great deal to tackle some of the underlying challenges some of them face. Hastings has long had high levels of unemployment, which is undoubtedly linked to having higher than average shares of people with no formal qualifications. You can see this even within London — Barking and Dagenham has relatively high levels of unemployment despite being within a city of nearly 6 million jobs. Again, the share of people here with few or no formal qualifications is above the national average.
The Covid-19 crisis will not offer a shortcut to achieving an aim that successive governments have tried to do for the last eight decades. Instead it will require long term action on improving the skills of the people living in these places, even if some of their new neighbours work mainly from their spare bedrooms.