Teleworking – Policy options

Prior to the COVID-19 outbreak, teleworking used to be treated chiefly as a matter of opportunity to improve employee’s work-life balance. Suddenly, the pandemic turned it into an urgent solution to reduce the risk of contagion and ensure economic continuity. The practice has spread from an occasional option mainly concentrated in a few countries, and in urban areas in particular, to a mass solution adopted throughout the OECD area and beyond. According to surveys, numerous companies at the global level are considering shifting to mass teleworking on a permanent basis even after the COVID-19 health crisis has been addressed.

A widespread shift to teleworking would have different impacts on people, places and firms. In particular, this transformation is bound to have an amplified effect at the local level. While a decline of cities seems unlikely, mass teleworking could promote a relocation of some jobs away from large metropolitan areas and represent an opportunity for regions lagging behind to catch up. This may be the case for small and medium-sized towns, semi-dense and rural areas with high-speed internet, which could attract growing shares of teleworkers and retain more residents, in a world where more jobs can be accessed from anywhere. Large-scale teleworking could also entail substantial changes for employees and employers. Part of the future ability of employees to improve their own work-life balance and of employers to retain talent might be based on the ability to extensively telework. However, pre-existing disparities (such as between high- and low-skilled workers, large firms and SMEs, etc.) might grow in the future, based on the different levels of amenability to teleworking. Empirical studies provide mixed evidence on the impact of teleworking on a number of key aspects, including labour productivity and employee satisfaction, calling for multi-stakeholder dialogue and data monitoring.

After the outbreak, governments at all levels launched a mixed set of policies to face the pandemic challenges and offer tailor-made responses to teleworking. Typically, national governments undertook framework measures to enable work from home. While enacting social distancing, they encouraged private employers to adopt this mode, and had to adjust the regulatory environment accordingly. Options ranged from introducing brand new or adapting pre-existing regulations to issuing guidelines or other quasi-legal tools. In addition, several national governments set up online platforms to make digital services offered by large IT providers accessible to all.

Regional and local governments, in turn, focused on building the capacities in the field to increase teleworking uptake. Several of them acknowledged the presence of digitalisation gaps and thus prioritised offering information and training services to citizens and firms. Conversely, a few digitally advanced communities even started drawing the first examples of long-term plans for a broader diffusion of teleworking on a permanent basis. Lastly, various governments, mostly regional, designed financial support schemes to foster the uptake of teleworking by SMEs, typically by subsidising investments in digital tools and skills.

Even prior to the pandemic, countries and regions worldwide launched programmes to foster the attraction of talented digital and remote workers or entrepreneurs, through the provision of grants, co-working facilities, start-up visas and other tools. Other jurisdictions set up measures and incentives for home-based businesses, including modifying rules on tenancy agreements and property taxation to foster this entrepreneurial form. In this context, teleworking was supported as an asset to help in fighting an ageing population, preventing a brain drain and making local entrepreneurial communities more vibrant. Pre- COVID policies of this kind could gain new momentum, with teleworking at a mass scale.

The following guiding principles could help promote a smooth transition towards a large-scale and enduring use of teleworking, with a sustainable teleworking model for different types of people, places and firms:

1. Take a comprehensive approach to policy design for teleworking. A long-lasting and large- scale use of teleworking could deeply affect local labour markets in urban and rural environments, along with residential and mobility patterns, as well as society more generally. These impacts are not yet fully predictable. A multidisciplinary, long-term perspective in policy design would help drive these transformative dynamics towards local development opportunities.
2. Promote fairness and inclusiveness across people, firms and places. Teleworking is unevenly accessible by different groups of workers, places (urban and rural) and firms (SMEs and large firms), and has diversified effects across them. Policies on teleworking could help level the playing field if complementary measures are in place.
3. Prioritise societal goals. A large-scale diffusion of teleworking could help reduce urban congestion and CO2 emissions, foster rural development, promote gender equality and pursue other sustainable development goals. Policies could prioritise socially beneficial solutions, and facilitate needed transitions, such as in the case of retailers and service providers located near office buildings, which may suffer from reduced demand.
4. Provide relevant national and local framework conditions. The availability of an agile legal framework and effective local public services (e.g. in fields such as child and elderly care), as well as high-speed internet, digital skills and a secure cyber environment are necessary requirements to make teleworking accessible and secure for all.
5. Create a new evidence base. Given its unprecedented features, large-scale teleworking requires new data and metrics to inform policy decisions. Its effects should be monitored over time to avoid biased conclusions and take into account the variety of circumstances for different people, firms and places. Policy design could facilitate data collection and adaptability to changing trends, as well as systematically provide for forms of ongoing monitoring and evaluation.

The paper concludes with a diversified set of preliminary policy recommendations to implement each of the above principles.

This work is divided as follows: section 1 puts teleworking into context, showing how the COVID-19 pandemic radically changed the approach to this long-standing policy issue. Section 2 shows that mass teleworking is a complex phenomenon affecting many policy areas and impacting groups of people, places and firms in different ways. Section 3 highlights that during the COVID-19 pandemic all levels of government were required to take action to support teleworking, and provides a classification of policy options. Chapter 4 offers takeaways for national and regional policy makers. Finally, Annex A presents a collection of policy practices on teleworking from countries, regions and cities of the OECD and beyond.

Source: OECD iLibrary | Exploring policy options on teleworking: Steering local economic and employment development in the time of remote work