Who Should Work from Home During a Pandemic? The Wage-Infection Trade-Off

18 Pages Posted: 2 Feb 2022

See all articles by Sangmin Aum

Sangmin Aum

Kyung Hee University

Sang Yoon (Tim) Lee

Queen Mary University of London

Yongseok Shin

Washington University in St. Louis; Federal Reserve Banks - Federal Reserve Bank of St. Louis; National Bureau of Economic Research (NBER)

Multiple version iconThere are 3 versions of this paper

Date Written: 2022

Abstract

Shutting down the workplace is an effective means of reducing contagion but can induce large economic losses. We harmonize the American Time Use Survey and O*NET data to construct a measure of infection risk (exposure index) and a measure of the ease with which a job can be performed remotely (work-from-home index) across both industries and occupations. The two indexes are negatively correlated but distinct, so the economic costs of containing a pandemic can be minimized by sending home only those workers that are highly exposed to infection risk but that can perform their jobs easily from home. Compared with a lockdown of all non-essential jobs, which includes many jobs not easily performed from home, a more selective policy can attain the same reduction in aggregate infection risk (32 percent) with one-third fewer workers sent home to work (24 percent vs. 36 percent) and only half the aggregate wage loss (15 percent vs. 30 percent). In addition, moving to such a policy reduces the infection risk of low-wage workers the most and the wage losses of high-wage workers the most. Our crosswalk between the American Time Use Survey and O*NET data can be applied to a broader set of topics.

Keywords: COVID-19, American Time Use Survey, O*NET, work from home, remote work

JEL Classification: E24, I14, J21

Suggested Citation

Aum, Sangmin and Lee, Sang Yoon (Tim) and Shin, Yongseok, Who Should Work from Home During a Pandemic? The Wage-Infection Trade-Off (2022). Available at SSRN: https://ssrn.com/abstract=4023832

Sangmin Aum (Contact Author)

Kyung Hee University ( email )

1732 Deogyeong-daero, Giheung-gu,
Yongin, 130-701
Korea, Republic of (South Korea)

Sang Yoon (Tim) Lee

Queen Mary University of London ( email )

Mile End Road
London, London E1 4NS
United Kingdom

Yongseok Shin

Washington University in St. Louis ( email )

One Brookings Drive
Campus Box 1208
Saint Louis, MO 63130-4899
United States

Federal Reserve Banks - Federal Reserve Bank of St. Louis

411 Locust St
Saint Louis, MO 63011
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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