Remote Work and Skill Expectations

This paper suggests that remote work increases employers’ demand for skills and qualifications. By reducing face-to-face interaction and synchronous communication, remote work increases the difficulty of training employees on the job. At the same time, it expands the labor pool by enabling employers to hire from a wider geographic range. Consequently, remote work elevates skill and qualification requirements in the labor market. We test this proposition by analyzing over 50 million jobs posted in 28 EU countries from 2018 to 2021. Using strict fixed effects on occupation-employer-country-year and an instrumental variable approach based on the COVID pandemic, we find that changing to remote work increases a job’s requirement on work experience, education credentials, and number of skills. These findings imply that remote work could potentially exacerbate skill-biased inequality.