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Remote work, not artificial intelligence or any of the other usual scapegoats, might be the reason young workers are facing such a dreadful job market. That is the finding of a new study by economists at the New York Federal Reserve and, at least on the surface, it seems to be a strong reason to support return to work mandates.
The economists focused their research on engineers at a Fortune 500 online retailer from 2019 to 2024. In the period before the pandemic forced everyone to become remote, engineers had been distributed between several buildings; some with young workers working alongside senior staff, some with the workers a 10-minute walk away from their mentors and some working remotely. All junior workers received comments, provided digitally, on their work from the senior engineers.
What they found was that, before the pandemic, engineers who were in the same building as their teammates received 24-per-cent more comments on the code they wrote than the engineers who were in different buildings.
Once the pandemic started and those workers went remote, researchers found the gap narrowed dramatically.
Looking more closely at the comments, they found that what was effectively ‘missing’ from the comments was anything that could be directly acted upon or which could be construed to be the answer to a direct question from a young engineer.
The remote workers, in other words, seemed to not be asking as many questions as those that were on-site. And sitting next to your teammates makes it easier to ask for help and, in return, means you receive it.
The researchers also found that proximity did not affect all engineers equally, with a disproportionate impact on those who had the most to learn. New hires, young engineers and female engineers were the most affected by proximity, perhaps because they were the least likely to ask for feedback when they could not do it in person.
Interestingly, the authors also found that the boost that the young engineers got from mentorship came at a cost to the senior workers providing the mentoring. Before the pandemic, those senior engineers who worked alongside their more junior teammates wrote less code than their colleagues who did not work as closely with junior workers. When offices closed, their productivity increased and then when they opened it fell again. Put another way, the organization faced a clear trade-off between supporting junior workers and getting more out of senior ones.
During the pandemic, when it was clearly more difficult to deal with and mentor less experienced workers, the organization in question chose to simply hire more experienced ones. That might arguably be unique to this firm or industry, or perhaps a phenomenon of the pandemic, except that the data suggests otherwise.
U.S. figures from 2017 to 2019 and 2022 to 2024 show that younger workers in ‘remotable’ jobs saw a larger increase in unemployment than older workers, while no such gap exists in jobs that were not remotable. After accounting for occupational exposure to artificial intelligence, the authors estimated that remote work accounts for 64 per cent of the total increase in unemployment among recent college graduates over the period.
There is much to take away from this research and it explains a lot of what we did see during the pandemic and its aftermath. During that period, we had huge demand for skilled workers, with many being poached from their existing positions. We also had many companies say that their productivity was rising in tandem with having employees work remotely. Both trends can be explained by the substitution of experienced workers for less experienced ones.
Despite the clear short-term benefits of having more experienced workers on board, there is clearly a cost to not hiring and training new workers. If you fail to do so, you are clearly not building a pool of talent that will be available in future, and that will eventually have repercussions when it gets to the point that there is no one left to poach. There are also economy-wide costs to not developing talent, including losing out on the potential tax revenues from having fully employed workers.
The easy solution to all of this is to say that remote work is the problem and to demand a return to office for every worker. That is certainly one way to fix things, but perhaps a more nuanced approach would be to acknowledge the issue and to actively look for ways to include and mentor all workers, whether in the next office or elsewhere.
That is a relevant point given that in the original study, the workers in offices 10 minutes away received less mentoring than the ones who sat alongside the senior workers. As well, the workers themselves could be encouraged to engage with their co-workers, even if that means purposely sending an email or text or making a phone call. In many organizations, that might mean an active change to the work culture while fully realizing it might come at the cost of short-term productivity.
As AI takes hold, there will be a threat to younger workers whose traditional job tasks might be replaced by technology. In light of that, now is the time to recognize the issues around mentorship and make some decisions about how to provide it to both in-person and remote workers.