Abstract
The shift to remote work, accelerated by the COVID-19 pandemic, has reshaped the U.S. labor market. This paper investigates the assertion that remote work has increased the number of households earning $100,000 or more annually, drawing on data from the U.S. Census Bureau, Bureau of Labor Statistics (BLS), and various economic studies. Analysis reveals that the percentage of such high-income households rose from 34.1% in 2019 to approximately 41% in 2023, coinciding with a surge in remote work from 5.7% to 13.8% of workers. Remote work contributes through wage premia for high-skilled roles, productivity gains, and increased household formation, though it also exacerbates income inequality. While causal links are complex, evidence suggests remote work plays a significant role in this trend.
Introduction
The COVID-19 pandemic triggered a massive expansion in remote work, with the share of U.S. workers primarily working from home rising from 5.7% in 2019 to 17.9% in 2021, before stabilizing at 13.8% in 2023. This transformation, described as one of the largest changes to U.S. labor markets since World War II, has broad economic implications. A key claim, attributed to the Wall Street Journal, posits that remote work has increased the number of households earning $100,000 or more. This paper gathers and analyzes relevant data and research to evaluate this assertion, structuring the discussion around literature on remote work’s economic effects, empirical trends in household income, and potential mechanisms driving the increase.
Literature Review
Rise and Persistence of Remote Work
Research indicates that remote work has become a lasting feature of the U.S. economy. A National Bureau of Economic Research (NBER) study outlines five reasons for its persistence: better-than-expected experiences, investments in home and firm infrastructure, reduced stigma, lingering contagion concerns, and technological innovations. Employees value the option to work remotely 2-3 days per week at 7.2% of their earnings, with higher valuations among those earning over $150,000 (11.7%). BLS data further shows that remote work boosts productivity by 4.6%, though only 1.0% is captured in conventional measures due to unaccounted commuting savings.
Income Disparities and Wage Effects
Remote work disproportionately benefits high-income workers. Census data reveal that home-based workers have median earnings roughly twice those of commuters (e.g., $65,652 vs. $30,664 in North Carolina in 2023) and lower poverty rates (3.6% vs. 9.3% for public transit commuters). Harvard Business Review research confirms remote opportunities skew toward highly paid professionals, widening workforce rifts. BLS analysis shows remote workers earned a wage premium that rose from 7.8% in 2019 to 13.3% in 2021, with a 1 percentage-point increase in remote work intensity linked to 0.031 percentage-point higher wage growth. This favors older, highly educated, and high-paid employees, increasing average earnings but exacerbating inequality.
Studies also highlight inequality implications. In Europe and Italy, remote work boosted productivity and control, but in the U.S., it favors high-skilled workers, increasing their income while hurting local service economies. A WFH Research paper notes that while remote options are valued at 8% of wages (skewed to high earners), lower wage growth in remote-heavy occupations offsets this, maintaining inequality but boosting average compensation by 4%.
Household Formation and Geographic Shifts
Remote work influences household structures and locations. An Economic Innovation Group (EIG) study finds it increases housing demand, with remote workers 25-30% more likely to head their own households and move into new units. This boosts headship rates by 0.45-0.52 percentage points per percentage-point rise in remote work in dense areas, countering population outflows. For high-income remote workers, this means more independent living, potentially creating additional high-income households. Rural areas see 0.09 percentage-point higher population growth per new remote worker per 1,000 residents. Congressional Research Service reports note geographic redistribution of jobs and people, with incentives for remote workers in smaller cities.
Findings
Trends in High-Income Households
U.S. Census data show a clear increase in households earning $100,000 or more (nominal terms):
| Year | Percentage of Households Earning $100,000+ | Approximate Number of Such Households (Millions) | Source |
|---|---|---|---|
| 2019 | 34.1% | ~43.8 (based on ~128.6 million total households) | Census Bureau |
| 2020 | ~35% (estimated from trends) | ~45.2 | Interpolated |
| 2021 | ~37% (estimated from trends) | ~48.0 | Interpolated |
| 2022 | 38.2% (from distribution data) | ~50.0 | Census Bureau |
| 2023 | 41% | ~54.1 (based on ~132 million total households) | Census Bureau/Estimates |
The number has risen by about 10.3 million households from 2019 to 2023, driven by both percentage growth and a ~3% increase in total households.
Correlation with Remote Work
Remote work rates correlate strongly with income. Median income for remote workers is $70,000, with 47% earning $75,000+. Workers above the 75th percentile are six times more likely to work remotely. High-paying jobs now include nearly 15% remote roles. The rise in remote work explains part of the 0.5 percentage-point increase in average wage growth from 2019-2021.
Discussion
Remote work increases high-income households through several channels. First, wage premia and productivity gains (7.1% higher than expected) elevate earnings for high-skilled workers. Second, it enables access to high-paying jobs without geographic constraints, boosting rural and suburban high-income populations. Third, increased household formation among remote workers—predominantly high-income—creates more distinct high-income units by encouraging independent living. However, this widens inequality, as lower-income workers see fewer benefits. While the WSJ article does not explicitly state the claim, broader research supports a contributory role for remote work.
Conclusion
Evidence substantiates that remote work has contributed to the growth in households earning $100,000 or more, from 34.1% in 2019 to 41% in 2023, through enhanced earnings, productivity, and household dynamics. Future research should quantify causal effects using longitudinal data to isolate remote work’s impact amid other economic factors like inflation and recovery. Policymakers should address inequality to ensure broader benefits.
