Who starts working in the digital economy?

Remote work has become commonplace since the start of the COVID-19 pandemic. But focusing on daily remote work arrangements may miss a larger opportunity that the pandemic has discovered: the potential for exponentially increased employment to work in the digital economy. To gauge interest in digital economy jobs, defined as jobs in business, finance, art, science, information technology, architecture, and engineering, the authors conducted extensive analyzes of job searches on the Bing search engine, which accounts for more than a quarter of all desktop searches in the United States. They find that not only has the search for digital economy jobs increased since the beginning of the pandemic, but these searches have also become less geographically focused. The single biggest societal consequence of the twin trends of businesses accepting remote work and people’s growing interest in digital economy jobs is the potential geographic spread of opportunities.

About the Covid-19 pandemic The public conversation about remote work. This shift raises the possibility that remote control will become commonplace or even the standard for many functions of the digital economy, which are loosely defined as jobs that use computers to produce digital goods and services. However, focusing on day-to-day work arrangements may miss out on an even bigger opportunity that the pandemic has explored: the potential for a massive workforce to work in the digital economy.

It’s another thing for employees to move to so-called “rising star” cities like Salt Lake City or Miami, but people across the United States suddenly realizing that they too can participate in the work of the digital economy is another thing entirely. The societal impact can be profound because removing geographical barriers opens up job opportunities in the digital economy for more people from more places.

For the emergence of remote work to have such a broad impact, a shift must occur on both sides of the labor market: companies must embrace remote work, and the pool of potential employment for working in the digital economy must grow and spread geographically. Companies are known to have become more comfortable working remotely as a result of the pandemic, with some notable companies, such as Twitter and Airbnb, offering full-time remote work. Overall, our analysis of LinkedIn job postings showed that in February 2020, only 2.3% of paid job vacancies in the United States offered remote work, and those hires attracted 2.9% of all applications submitted during that month. By February 2022, 19.5% of paid vacancies in the United States offered remote work and attracted 49.7% of applications.

Here, we provide evidence that the lesser known supply side of the job market in the digital economy is expanding not only in megacities and megacities but also in medium-sized cities and rural areas. This will have major implications for society, businesses and job seekers.

Interest in digital economy jobs has increased after the outbreak of the epidemic

To gauge interest in digital economy jobs, defined as jobs in business, finance, art, science, information technology, architecture, and engineering, we conducted extensive analyzes of job searches on the Bing search engine, which accounts for more than a quarter of all desktop searches in states. Using the method used in the 2018 Study of Employment Data, from a random sample of queries, we identified and categorized more than 100 million job inquiries in employment sectors, grouped them by month and US county, and compared temporal trends throughout the COVID employment shock (March 2020 – February 2022). ) with a two-year baseline before COVID (January 2018 – February 2020). Examples of these searches include “Software Engineer Career” (technology), “Medical Insurance Professional Job” (Finance), “Enterprise Freelance Writing Jobs” (Art).

Searches for such jobs on Bing show a strong and growing interest in this business, as shown in the following figure. In the two years prior to the pandemic, interest in these digital economy jobs was roughly flat, with an additional 1% growth rate of all job searches approximately every 14 months. In response to the pandemic, interest in digital economy jobs has jumped 15%: a statistically significant impact, with the growth rate in these searches more than double the pre-pandemic rate. Nearly six years of growth in job searches have been seen in the digital economy in the span of two years. Moreover, aggregate applications of remote jobs, which generally include digital economy jobs, are showing similar levels of growth. Data from LinkedIn shows that in February 2020, only 1.4% of applicants had applied for jobs exclusively remotely, and by February 2022, 24.6% of applicants had applied exclusively to remote jobs.

Job searches in the digital economy have been seen in a variety of geographies

The gap in interest between rural and urban counties has shrunk to just 30% of what it was before the pandemic. By February 2022, job seekers from all counties, including those living in rural areas, were searching for jobs in the digital economy at the same level as county job seekers in supercities (that is, established tech hubs like San Francisco and Seattle). at the beginning of the epidemic. If current growth rates continue, the rest of the country will catch up with levels of interest in the digital economy by those in supercity counties in about seven years, with job searches in the digital economy accounting for more than 50% of all job searches on Bing.

Moreover, these job searches are becoming less geographically focused. For example, in February 2020, job searches in the digital economy accounted for more than a third of all job searches in just 44% of small urban and rural counties. (“Other – Rural” and “Other – Urban” are defined as counties coded as 6 or higher [rural] and 5 or less [urban] in USDA Urban and Rural Sequence Codes.) Two years later, in February of 2022, that percentage jumped to 72% (see ‘Other – Rural’ in the following figure). In counties with larger urban areas, this percentage jumped from 52% in February 2020 to 87% of counties in February 2022 (see ‘Other – urban’ in the following figure).

Implications for a geographically diverse digital economic workforce

The single biggest societal consequence of the twin trends of businesses accepting remote work and people’s growing interest in digital economy jobs is the potential geographic spread of opportunities. Together, the two trends could break the sticky focus of digital economy jobs in supercities.

IT business group CompTIA estimated that there were nearly 1 million IT job openings in the US in 2019, and the US Bureau of Labor Statistics (BLS) estimates that employment for software developers will grow 22% from 2020 to 2030, outpacing much other industries. Crucially, given this labor shortage in the digital economy, we don’t expect it to be implemented in a zero-sum game where jobs will be shipped from cities like San Francisco to cities like Boise. Instead, these trends suggest that the size of the workforce in the digital economy can increase and spread geographically, eventually opening doors to digital economy functioning for millions of people who would otherwise not be able to be part of that economy.

Deploying digital economy jobs across the United States will make local economies more resilient in the face of regional economic downturns, as it allows municipalities to diversify their workforce. People will be able to access the same local jobs they had previously, along with jobs in the digital economy. So if there is a shock in one industry, the local economy can still rely on spending and tax revenue from those in other industries. Moreover, Professor Enrico Moretti’s research has shown that there is a multiplier effect in that for every job in the digital economy that is created, additional local jobs are created in a variety of economically healthy employment sectors, including healthcare, education, food and hospitality, among others. other.

Companies at the forefront of this trend will benefit from a huge first mover advantage because they will have first access to talent scattered across the United States. After the first movers start hiring, other digital economy companies will need to follow suit in order to stay competitive on talent. As an added bonus for companies, a more geographically diverse workforce may result in a more demographically diverse workforce, which has been shown to be associated with increased creativity and market share for the company. Of course, digital economy companies that embrace the geographic spread of talent and interests will have to rethink traditional infrastructure and operating costs, telecom technology spending and implementation, and practices to maintain corporate culture in a remote/hybrid environment. It remains to be seen whether these costs will be offset by increased talent and quality of work.

For potential employees, the rapid spread of remote job postings should increase employment opportunities. An analysis of LinkedIn job postings showed that by February 2020, only 6.0% of US companies had open jobs that offered remote work; which grew to 34.2% in February 2022. Those who live in areas that have not traditionally been involved in the digital economy will be able to find a wider network when looking for work, making previously unobtainable job opportunities possible. Those who have the skills for digital economy jobs, along with electricity and internet access, will have lucrative opportunities in the digital economy. Those who do not do so will be at risk of being left behind. This creates a huge opportunity for companies to help upskill people in these jobs and for municipalities and broadband companies to help residents get the Internet access they need.

Many developments in communication technology in the past (telegraph, telephone, fax, Internet, etc.) have not resulted in such a significant change in the part of people working remotely. What is different this time has less to do with the technological changes brought about by the pandemic and more to do with social changes. Standards around work have changed. Working in the office is no longer the default. Thus, companies are more willing to hire remote workers, and our data suggests that more people from more places are interested in work that can be done remotely. These shifts on both sides of the job market have created an opportunity for a future of work where people beyond rising stars and rising cities can participate in the digital economy.

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