Publication 109 August 2023

The Impact of Remote Work

Roberto Gallardo
Purdue Center for Regional Development
 About the Author

Roberto Gallardo
Vice President | Office of Engagement

Director | Purdue Center for Regional Development

Associate Professor | Department of Agricultural Economics

Roberto Gallardo is the Vice President for Engagement, Director of the

Purdue Center for Regional Development and an Associate Professor in the
Agricultural Economics Department. He holds an electronics engineering
undergraduate degree, a master’s in economic development, and a Ph.D.
in Public Policy and Administration. Gallardo has worked with rural
communities over the past decade conducting local & regional community
economic development, including use of technology for development.

He has authored more than 100 articles including peer-reviewed and news-
related regarding rural trends, socioeconomic analysis, industrial clusters,
the digital divide, and leveraging broadband applications for community
economic development. He is also the author of the book “Responsive
Countryside: The Digital Age & Rural Communities,” which highlights a
21st century community development model that helps rural communities
transition to, plan for, and prosper in the digital age. Dr. Gallardo is a TEDx
speaker and his work has been featured in a WIRED magazine article, a
MIC.com documentary, and a RFDTV documentary.
 The Impact of Remote Work
Abstract

Working from home became necessary during the COVID-19 pandemic. According to a survey done by
the Stanford Institute for Economic Policy Research1 during May of 2020, 42% of all U.S. workers worked
from home and accounted for two-thirds of the nation’s gross domestic product. Therefore, work from
home has become a feasible economic development strategy at the onset of COVID-19. This study gauges
the contribution of workers from home in Indiana in 2021 by using the Regional Economic Modeling, Inc.
(REMI) general equilibrium model. Results indicate that the roughly 222,000 workers from home in the state
contributed to a little more than 493,000 jobs across more than 10 industries. In addition, these workers added
close to $54 million to the state’s GDP that year. To fully maximize the impact of these workers, some strategies
may include communities adapting work from home incentives, better and more affordable broadband,
adequate facilities for workers from home (like co-working spaces), matching employers with workers from
home, and offering work from home-related skills through training and certifications.

Background Figure 1. OCRA Regions*

Remote work2 has been discussed as a feasible

economic development strategy even before the
COVID-19 pandemic. Work from home has a positive
impact on local communities and regions, urban
and rural. However, access to affordable and reliable
internet is a critical element for remote workers and
for this reason has tremendous implications for digital
equity and community and economic development.

As part of our efforts to better understand the digital

equity landscape in the state of Indiana, it is important
to also understand the impact that workers from home
have on the state. This should help further elevate
the need to build affordable and reliable broadband
networks throughout the state, benefiting urban and
rural communities. Ubiquitous, more affordable, and
reliable networks will sustain and expand this economic
development strategy.

To estimate the impact of remote workers in the state of

Indiana, REMI’s general equilibrium model was utilized.
The number of remote workers—obtained from the
American Community Survey (ACS) 2017-2021—across
13 industries were used as policy inputs for regions as
defined by the Indiana Office of Community and Rural
* Marion County is included in the West Central region.
Affairs (OCRA). See Figure 1.

1
How working from home works out | Stanford Institute for Economic Policy Research (SIEPR)
2
Note that the terms remote workers and work from home are used interchangeably in this report.
3
 Data & Methods

After consulting with REMI specialists, the number of remote workers as reported by the U.S. Census American
Community Survey (ACS) 2017-2021 for each of the six regions in the state were used as policy inputs. However,
because the REMI PI+ industry data is more detailed (70 industries) than the Census remote worker data by
industry (13 industries), the shares of total jobs within each Census industry was calculated and applied to the
appropriate REMI industry or industries within the work from home group. This resulted in 420 policy inputs
(70 industries in each of the six regions).

Tables 1 & 2 show the process followed and how the REMI industries were grouped to match the Census
industries. For example, there were a total of six industries in REMI (see left column in Table 1) that matched the
Census industry of agriculture, forestry, fishing and hunting, and mining which had 868 workers from home in
the northwest region. The share of total jobs for each of the REMI industries in that Census industry is shown in
the third column. To assign the number of workers from home to each REMI industry to input in the model, its
share of total jobs in the Census industry was multiplied by the total number of workers from home. The column
on the right in Table 1 shows the number of remote workers according to the Census in each REMI industry.
This process was repeated for all Census industries and each of the six regions.

Table 1. Calculation of Workers from Home by REMI PI+ Industry and Sub-Industries

REMI Industry Group Total Number of Working

Share of Total Jobs by REMI Number of workers from
Equivalent to Census from Home by Census ACS
Industry (%) home by REMI Industry
Industry Industry
Forestry and Logging; 2.2 19
Fishing, hunting, and
trapping
Support activities for 14.2 124
agriculture and forestry
868
Oil and gas extraction 0.2 1
Mining (except oil and gas) 2.8 24
Support activities for mining 0.0 0
Farms 80.6 699

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Table 2. Census and REMI PI+ Industry Categories Alignment

ACS 5-Year 2017-2021 Industry REMI PI+ Industry Group

• Forestry, fishing, and hunting (includes 2 industries)

Agriculture, forestry, fishing and hunting, and mining • Mining (includes 3 industries)
• Farms

Construction • Construction

Manufacturing • Manufacturing (includes 20 industries)

Wholesale trade • Wholesale trade

Retail trade • Retail trade

• Utilities
Transportation and warehousing, and utilities
• Transportation and warehousing (includes 9 industries)

Information • Information (includes 5 industries)

• Finance and insurance (includes 3 industries)

Finance and insurance, real estate, rental, and leasing
• Real estate and rental and leasing (includes 2 industries)

• Professional, scientific, and technical services

Professional, scientific, and management and administrative • Management of companies and enterprises
and waste management services • Administrative, support, waste management, and
remediation services (includes 2 industries)

• Educational services; private

Educational services, and health care and social assistance
• Health care and social assistance (includes 4 industries)

Arts, entertainment, and recreation and accommodation and • Arts, entertainment, and recreation (includes 3 industries)
food services • Accommodation and food services (includes 2 industries)

• Other services (except public administration) (includes 4

Other Services (except public administration)
industries)

• Local Government
Public administration • State Government
• Federal Civilian

Source: Census ACS 2017-2021; REMI PI+

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 Regional Characteristics

Before we discuss the impact of remote workers in the state and each of the OCRA regions, it is important
to understand specific socioeconomic and demographic characteristics of these regions. Figure 2 shows
the share of population by OCRA region that reside in rural areas based on the 2020 Census. Three of the six
regions had a higher share of rural population compared to the state with the southwest and southeast regions
having close to half of their population residing in rural areas.

Figure 2. Percent Rural Population by OCRA Region

Source: 2020 Census

Figure 3 shows the educational attainment breakdown for the population ages 25 or older in each of the OCRA
regions. The east central and west central regions were the most educated with roughly one-third of their
population having a bachelor’s degree or higher compared to the southwest region where a little more than
one-fifth of its population age 25 or older had a bachelor’s degree or higher.

Figure 3. Educational Attainment for the Population Age 25 or Older

Indiana 10.2 33.0 28.9 27.8

West Central 10.7 29.4 27.7 32.2

Southwest 10.2 36.2 31.2 22.4

Southeast 9.9 37.0 29.7 23.4

Northwest 9.7 35.0 29.4 25.9
Northeast 12.9 34.7 29.5 22.9
East Central 7.8 30.8 27.9 33.5

Less than high school High school Some college Bachelor's or higher
Source: 2017-2021 American Community Survey

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According to the 2017-2021 ACS, there were 222,777 remote workers in Indiana (not including armed forces),
or about 7% of total workers aged 16 or older in the state. As shown on Figure 4, more than one-fifth worked
in the professional, scientific, and management, and administrative and waste management service industries
(21.4%) followed by educational services, and health care and social assistance industries with 19.3%. About
28% of remote workers were scattered across eight industries.

Figure 4. Top 5 Industries with Share of Working from Home

Manufacturing
12.5
Retail trade
28.2 6.4
Finance/insurance, real estate, and
rental/leasing
12.2
Prof., scientific, management, and
waste admin.

19.3 Ed. services, and health care and

21.4 social assistance

Other

Source: 2017-2021 American Community Survey

Figure 5 shows the share of workers from home per OCRA region. The west central region (which includes
Marion County) had the highest with 34.3% followed by the northeast region with 21.8%. The southwest region
of the state had the lowest share with 5.5%.

Figure 5. Share of Workers from Home by OCRA Region

East Central
21.8
Northeast
34.3

Northwest
12.2
Southeast

5.5 Southwest
8.5 17.7
West Central

Source: 2017-2021 American Community Survey

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Figure 6 shows the average download/upload speeds in megabits per second (Mbps) by OCRA region based on
Ookla speed tests results. The west central region had the highest average download/upload speeds while the
northeast had the lowest download and the northwest the slowest average upload speeds. Reliable high-speed
internet is critical for remote workers.

Figure 6. Average Download/Upload Speeds in Megabits per Second (Mbps)

Source: Speedtest® by Ookla Global Fixed Network Performance Maps; annual weighted average

Results

About 222,777 Indiana workers aged 16 or older, or 7% of the state’s workforce, worked from home across 13
different industries in 2021. Their jobs contributed to a total of 493,790 jobs and 149,444 residents across the
state—of which 1,510 of the latter were due to natural growth and 147,934 to economic migrants—and added
129,377 workers to Indiana’s labor force. Furthermore, their work contributed $53.7 million to the state’s gross
domestic product (GDP) or roughly $2,499 to real disposable personal income per capita for that year. Table 3
summarizes the economic impact of Indiana’s remote workers. For regional tables, please refer to Appendix A.

Table 3. Economic Impact Summary of Remote Workers in Indiana

Item 2021
Total Employment +493,790
Population +149,444
Labor Force +129,377
Value-Added to the GDP (millions) +$53.7
Real Disposable Personal Income Per Capita +$2,499

Source: REMI PI+; 2017-2021 ACS

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Figure 7 shows the top ten industries’ share of jobs contributed by workers from home. These ten industries
account for close to two-thirds of the close to half a million jobs added. Note the diversity of industries
impacted.

Figure 7. Top Ten Share of Added Jobs by Industry

Source: REMI PI+; 2017-2021 ACS

Of the close to half a million jobs workers from home contributed in 2021, Figure 8 shows the distribution by
earning quintiles based on all occupations. A little more than one-fifth were in the highest earning quintile
(22.9%) compared to 21.9% of the state’s distribution. A similar difference is seen among the share of jobs in
the lowest earning quintile, where the share of the contribution from workers from home is lower compared
to the state’s (25.4% versus 26.9%).

Figure 8. Share of Jobs by Earning Quintiles

Workers from Home

25.4 20.5 22.8 8.4 22.9
Contribution

State Level 26.9 20.7 21.4 9.2 21.9

Lowest 20% Second 20% Middle 20% Fourth 20% Highest 20%
Source: REMI PI+

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Regarding educational attainment, a similar share of the jobs contributed by workers from home required a
bachelor’s degree or higher compared to the overall state share (30.6% versus 30.8%) as shown in Figure 9.

Figure 9. Share of Additional and State Overall Jobs by Educational Attainment

Source: REMI PI+

Finally, Figure 10 shows that the share of white non-Hispanic labor force workers from home contributed was
higher compared to the state’s level. On the other hand, the share of minority labor force groups was lower
compared to the state’s level, especially among Hispanics.

Figure 10. Share of Additional Labor Force by Race/Ethnicity

100.0
90.0 84.9
79.5
80.0
70.0
60.0
50.0
40.0
30.0
20.0
7.1 8.8 7.2
10.0 3.9 4.5 4.1
0.0
White, Black, Other, Hi span
non-His non-His non-His ic
panic panic panic

Workers from Home Contribution State Level

Source: REMI PI+

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 Conclusions

Studies suggest that better broadband can lead to more workers from home, increased self-employment, and
benefits for women and high-skilled workers3,4,5. With roughly 7% of workers aged 16 or older working from
home in Indiana, the impacts of these workers are important. As discussed above, these workers added more
than half a million jobs to the state in 2021 and increased the state’s population and labor force.

However, work remains to be done to ensure that those who can work from home include a diverse group
of individuals. And while ubiquitous, reliable, and affordable broadband networks are a critical element, it
is not the only one. Creating a diverse pipeline of workers from home is also important to ensure a digital
equitable landscape is leveraged. Some strategies may include communities adapting remote work incentives,
better and more affordable broadband, adequate facilities to conduct remote work (like co-working spaces),
matching employers with workers from home, and offering remote work-related skills through training and
certifications.

Publication 109 August 2023

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and Policy Insight reports?
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Report Design by Ryan Maluchnik, Purdue Center for Regional Development

3
Houngbonon, G., & Liang, J. (2021). Broadband Internet and Income Inequality. Review of Network Economics, 20, 55 - 99. https://doi.
org/10.1515/rne-2020-0042
4
Han, L. (2021). Broadband, Self-Employment, and Work-from-Home — Evidence from the American Community Survey. Econometric
Modeling: Microeconometric Models of Household Behavior eJournal. https://doi.org/10.2139/ssrn.3936667
5
Billari, F., Giuntella, O., & Stella, L. (2019). Does broadband Internet affect fertility?. Population Studies, 73, 297 - 316. https://doi.org/10.
1080/00324728.2019.1584327
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 Appendix A

Table A1. Economic Impact Summary of Remote Workers in the Northwest Region

Item 2021
Working from Home 39,526
Total Employment 77,097
Population 22,352
Labor Force 22,865
Value-added GDP (millions) $7.644
Real Disposable Personal Income Per Capita $1,444

Source: REMI PI+; 2017-2021 ACS

Table A2. Economic Impact Summary of Remote Workers in the Northeast Region

Item 2021
Working from Home 27,175
Total Employment 54,697
Population 18,161
Labor Force 12,229
Value-added GDP (millions) $5.344
Real Disposable Personal Income Per Capita $1,451

Source: REMI PI+; 2017-2021 ACS

Table A3. Economic Impact Summary of Remote Workers in the East Central Region

Item 2021
Working from Home 48,477
Total Employment 102,836
Population 33,748
Labor Force 29,925
Value-added GDP (millions) $10.333
Real Disposable Personal Income Per Capita $3,653

Source: REMI PI+; 2017-2021 ACS

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Table A4. Economic Impact Summary of Remote Workers in the West Central Region

Item 2021
Working from Home 76,334
Total Employment 200,303
Population 56,227
Labor Force 48,954
Value-added GDP (millions) $24.222
Real Disposable Personal Income Per Capita $3,930

Source: REMI PI+; 2017-2021 ACS

Table A5. Economic Impact Summary of Remote Workers in the Southeast Region

Item 2021
Working from Home 19,036
Total Employment 33,780
Population 10,591
Labor Force 8,285
Value-added GDP (millions) $3.491
Real Disposable Personal Income Per Capita $1,354

Source: REMI PI+; 2017-2021 ACS

Table A6. Economic Impact Summary of Remote Workers in the Southwest Region

Item 2021
Working from Home 12,229
Total Employment 25,078
Population 8,366
Labor Force 7,119
Value-added GDP (millions) $2.647
Real Disposable Personal Income Per Capita $1,236

Source: REMI PI+; 2017-2021 ACS

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