Study Examines Telework and Its Impact on Local Income
Jen Sherwood had a dilemma. As a single mother with two school-age children—one of whom has severe health issues—she needed a job with flexibility. A traditional 9-to-5 job in an office just wouldn’t cut it.
Her father heard about Digital Works in Newaygo, Michigan and told her she could train to work at home. A few months later, she was hired by Amazon.com, giving Sherwood an opportunity “to be a full-time mom and earn a full-time paycheck.”
Will Yarborough also needed a job with flexibility but for a different reason—he is serving his country in the Texas Army National Guard. He trained at the Grants, New Mexico, SoloWorks facility, learning key customer service and computer skills and soon landed a job at ViaSource Solutions.
“A veteran or someone in the active military is a perfect match for online jobs,” Yarborough said. “It takes a certain kind of person to go through services. They learn certain soft skills and life skills that make them dependable. They’re very punctual and understand how to deal with problems as they arise using the chain-of-command.”
Sherwood and Yarborough are not alone. Many people—from senior citizens to millennials—are looking for a new way to work.
The New Job Market
The workforce itself and the needs of employers have changed, but many communities are still operating on the old formula. Traditionally, workforce development focused on bringing companies to an area through tax breaks and other incentives.
But a recent study conducted by researchers from Purdue University and Oklahoma State University shows that to focus solely on that approach means missing a big economic opportunity through teleworking and telecommuting.
“Many, if not all, states have a well-oiled manufacturing incentive system,” said Dr. Roberto Gallardo, Assistant Director of the Purdue Center for Regional Development (PCRD) and a Purdue Extension Community & Regional Economics Specialist. “They have an approach they’ve developed over time to give incentives to these brick-and-mortar companies that will build in their area and employ people in their area. Why not leverage that same, effective system in a new way and use it for teleworkers?”
Gallardo and Dr. Brian Whitacre from Oklahoma State University recently completed a study titled, “21st Century Economic Development: Telework and Its Impact on Local Income.” During their research, the two found that teleworking and telecommuting positively impact median household income at the neighborhood level (census tracts) and potentially spur economic growth in surrounding areas.
“It’s basically a spillover effect,” Gallardo said. “As teleworkers move forward in their career and increase their wages, you begin to see a positive spillover to neighboring tracts. You begin to see the spending increase beyond just the place where these people live and work.
“We found that both salaried and self-employed teleworkers are seeing a positive impact on their median household income. What communities and states need to do now is modify their economic and workforce development policies—to nurture, attract and retain teleworkers.”