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Labor Data Suggests Major Shift in Work Arrangements From COVID, More Sector-Specific Impact on Wages

  • About half of employees in recent Bureau of Labor Statistics data saw their companies expand telework options
  • Companies also expanded flexible schedules, job sharing, dependent care paid leave, and other options
  • Wage hikes, relocations, and changes to square footage were less common

Summary by Dirk Langeveld

The COVID-19 pandemic has driven widespread changes to how companies structure their schedules or working arrangements, according to recent data from the Labor Department’s Bureau of Labor Statistics.

The 2021 Business Response Survey to the Coronavirus Pandemic, which was issued to private sector businesses between July 27 and Sept. 30, found that about one-third of these companies and half of all employees have seen their telework options expand during the pandemic. Workplaces were also more likely to introduce flexible schedules, job sharing, and other changes to how the company operated.

The pandemic spurred additional trends such as wage hikes, commercial downsizing, and vaccine requirements for in-person work. However, the survey suggests that these changes have been less widespread than the shift in how employees work.

Work arrangements

A total of 34.5 percent of private sector businesses surveyed by BLS said they had increased their telework options for some or all employees. These employers accounted for 50.8 percent of all employees. A total of 60.2 percent of companies, covering 56.2 percent of workers, said they expect to keep these arrangements once the pandemic is over.

Fully remote operations remained rare, with 10.3 percent of companies having employees teleworking all the time – representing just 3 percent of all employees. A total of 29.8 percent allowed some remote work, affecting 47.4 percent of workers, while 60.1 percent rarely or never allowed telework (representing 49.8 percent of employees).

About one-third of employees, or 33.9 percent, had access to flexible or staggered hours after 24.6 percent of employers began offering this scheduling arrangement during the pandemic. A total of 12.2 percent of employers, encompassing 18.2 percent of employees, began offering compressed or alternative schedules.

Eleven percent of employers allowed workers to voluntarily reduce their hours or shift from full-time to part-time work. Job sharing, where two workers split the hours and tasks of a full-time job, was was less common, offered by just 2.3 percent of employers.

Wages and benefits

About one in five private sector employees saw their base wages go up in response to the pandemic, with 14.5 percent of establishments taking this step. This figure fell well below that cited in a recent poll by the National Federation of Independent Business, where a net share of 50 percent of small business owners said they have raised compensation to compete for scarce workers.

The BLS data suggests that wage hikes are more likely in industries where workers have been quitting at higher levels or where qualified candidates are rarer. Sectors where above-average wage increases were occurring included accommodation and food services, retail trade, health care and social assistance, and manufacturing.

A total of 9.4 percent of employers began offering one-term bonuses, with 23.7 percent of all employees receiving this benefit. Just 5.5 percent offered temporary hazard pay or hourly bonuses, though these were available to 15.7 percent of workers.

Some employers also expanded their benefits, offering additional paid leave for any employees with dependent care needs. A total of 6.5 percent began providing this benefit, making it available to 14.4 percent of workers.

COVID-19 precautions

The BLS survey predates the increase in COVID-19 vaccine requirements adopted by businesses in response to the Delta variant, as well as the Biden administration’s proposed vaccine rule for larger companies. However, it still reflected a variety of COVID-19 precautions adopted by companies for on-site workers.

A majority of businesses, 58.3 percent, required some or all employees to wear a mask while working in person. This rule applied to 70.4 percent of employees in the survey.

Twenty-eight percent offered a financial incentive for employees to get a COVID-19 vaccine, including providing paid time off or allowing them to stay on the clock in order to get vaccinated. Just 17.5 percent required some or all on-site workers to be vaccinated, with 14.5 percent of employees subject to such a mandate.

Other trends

Few businesses were changing the size of their business, with 91 percent maintaining the same square footage. A total of 5.5 percent percent had downsized and 4 percent planned to do so, while 3.6 percent had increased their square footage and 3.6 percent are planning to do so.

A total of 94.2 percent of businesses didn’t relocate due to the pandemic. Four percent said they expect to relocate within the next 12 months.

Ninety-one percent of businesses said they did not turn to labor solutions such as temporary help, contractors, subcontractors, or online platforms for assigning workers during the pandemic. However, 14.8 percent said they plan to begin using at least one type of these workers once the pandemic is over.

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