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November 2, 2020updated 30 Aug 2022 3:31pm

WFH today, offshoring tomorrow? Why Covid-19 may accelerate the globalisation of work

One in ten Americans are planning to relocate, given greater freedom to work from home. This could trigger the next wave of offshoring.

By Amy Borrett

The Covid-19 pandemic has permanently changed employee expectations for working from home, to the extent that many people are reconsidering where they live. But one expert warns that this remote working boom may result in a new wave in offshoring.

According to a new US study by freelance working platform Upwork, one in ten people, the equivalent of up to 23 million Americans, are planning to relocate as a result of the shift to remote work prompted by the pandemic.

This is about three times as many people who would typically relocate in any given year; between 2018 and 2019, 3.6% of the US population moved county or state, according to data from the US Census Bureau.

More than half of those respondents planning to relocate intend to move outside of daily or weekly commuting distance. Upwork’s survey found that 54.7% plan on moving more than two hours from their current location, and 41.5% more than four hours away. A fifth of those planning a move currently live in major cities.

In the short-to-medium term, this shift will intensify demand for technology tools that support creativity, engagement and productivity among remote teams. Software-as-a-service (SaaS) and machine learning have triggered a “renaissance” in productivity and collaboration-boosting tools, a joint report from the University of Oxford and investment manager Citibank recently argued.

But the move to widespread remote work portends an even bigger shift, namely the accelerated globalisation of work, says Carl Benedikt Frey, director of the Future of Work Programme at the Oxford Martin School, University of Oxford.

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“Jobs that can be done remotely can also be done offshore,” he says. “In many cases, remote work is only a transitional phase before the next wave of offshoring as companies take advantage of new technologies, like telepresence, and cheaper labour in places like India. The jobs that will remain onshore are those that centre on sporadic interactions that drive innovation.”

If true, technology leaders could soon be faced with an even greater challenge: providing tools and technologies that support effective collaboration across continents, cultures and time zones.

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