Researchers from the Federal Reserve Bank of New York say that the rise of remote work is linked to the rise in unemployment among more recent college graduates. File photo by Tony Avelar/EPA-EFE
June 1 (UPI) — Research shows that a rise in remote work since the COVID-19 pandemic is connected to a rise in unemployment among younger employees, the Federal Reserve Bank of New York reported Monday.
In a blog post, the research authors said they estimate about 64% of the rise in unemployment among recent college graduates has to do with the connection to remote work, which “makes it more difficult for manager sto train and mentor new employees,” they wrote.
“Accordingly, companies may be reluctant to hire less-experienced workers in distributed work arrangements,” the post continued.
The authors said that unemployment among those younger than 29 was an average of 3.1% in 2017-19, compared to an average of 3.7% in 2022-25. Conversely, they wrote, the unemployment rate for more experienced college graduates fell from 1.9% in 2017-19 to 1.8% in 2022-25.
The researchers said they used data on both “remotable” and “non-remotable” jobs, comparing how easily common tasks for a given job can be done remotely. They also used proprietary data from an unnamed Fortune 500 company.
“We show that when people work next to their colleagues, they receive more feedback on their output and more mentorship,” the authors wrote. “When they are separated by even a short distance, that feedback tapers off dramatically. The loss in feedback is more pronounced for younger workers, who miss out on constructive comments that spur their development.”
However, Nicholas Bloom, an economics professor at Stanford University who studies remote work, said that even companies that have remote work often have opportunities for time on site, CNBC reported.
“I don’t think there is any evidence this is slowing employment,” Bloom said. “Indeed, quite the reverse, as it’s easier for people to work and so labor supply looks to be rising.”