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Coronavirus: High earners twice as likely to be able to work from home

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·Senior City Correspondent, Yahoo Finance UK
·2-min read
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16 March 2020, Berlin: A man is now working from home. During the Corona crisis, many people are forced to work from home. Either because of protective measures taken by the employer or because they have to look after the children because of school closure. Photo: Annette Riedl/dpa-Zentralbild/ZB (Photo by Annette Riedl/picture alliance via Getty Images)
A man is now working from home. (Annette Riedl/picture alliance via Getty Images)

High earners are more than twice as likely to be able to work from home than lower income workers, according to a new study.

PwC said on Tuesday that 70% of people who earn over £50,000 ($61,494) per year are able to work remotely, compared with just 32% of people earnings less than £20,000.

Only 47% of those earning between £20,000 and £50,000 were able to work from home, according to PwC’s survey of 650 workers. The average British employee earns around £26,600 per year, according to Office for National Statistics data.

The findings highlight the disparity between high and low earners during the coronavirus pandemic.

Governments around the world have placed populations on lockdown to slow the spread of COVID-19. The UK government has told people to not to leave the unless they absolutely have to for work.

While higher paid workers can simply relocate to the home, many lower paid employees face a grim choice of either staying at home and giving up income or continuing to work and risking their health.

In practice, this means that while most office workers are now on laptops in their living rooms, lower-paid “essential” workers such as nurses, cleaners, carers, farm pickers, and delivery drivers are still having to go out in public for their work.

Read more: Pound rallies with Boris Johnson 'not on ventilator' as he battles coronavirus

“With fewer lower paid workers able to work from home, the negative economic impact of COVID-19 may be greater for lower socio-economic groups, particularly those who work in sectors such as transport, non-food retail and hospitality,” said Jing Teow, a senior economist at PwC.

“There's a real risk that the ability to work remotely – or not – exacerbates inequality.”

A separate study released this week by the Institute of Fiscal Studies (IFS) said young workers, low earners and women will be most affected economically by the coronavirus lockdown. The report found there was a “remarkable concentration” of these groups working in sectors like hospitality and retail that have been badly hit by the lockdown.

John Hawksworth, chief economist at PwC, said there were “sharp falls in output in sectors such as hotels, restaurants and pubs, non-food retail and transport.”

“We estimate that these most vulnerable sectors could see annual output in 2020 down by anything from around 15% to around 40% in alternative lockdown scenarios, relative to a baseline without COVID-19,” Hawksworth said.

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