Prof. Zhang: The Pandemic Prompted Many Things, Including the 'Creative Destruction' Benefit of Working from Home
June 8, 2021
Contact: Office of Advancement and External Relations
Ting Zhang, associate professor in the Department of Accounting, Finance, and Economics in The University of Baltimore's Merrick School of Business, says the COVID-19 pandemic may "permanently impact" business and the lives of working people by significantly boosting the number of people who are working from home. Prof. Zhang's research, co-authored with UBalt Prof. Daniel Gerlowski and George Mason University's Zoltan Acs, professor in the Schar School of Policy and Government, appears in a new paper published in Small Business Economics.
While COVID-19 prompted many changes to the global economy—many quite negative—the rise of working from home (WFH) is now widely accepted and integrated into business planning. Prof. Zhang and her research team cite widespread evidence that a large portion of jobs can be at least partly handled from a remote environment, and a significant percentage of firms believe that WFH will remain in place after the pandemic is declared mostly over.
"We find that (1) small businesses in states with higher WFH rates performed better with industry variations, controlling for local pandemic and socioeconomic factors; and (2) WFH rates increased after stay-at-home orders were rescinded," Prof. Zhang writes in the study's abstract. "Our study demonstrates WFH as a potential 'creative destruction' force that may expedite our technologically ready WFH adoption and permanently impact industrial structure and peoples' work lives."
The study finds that WFH is "associated with better overall small business performance and is on the rise even after the [stay-at-home] mandate ended," Zhang tells The Academic Times.
The paper is supported by the Merrick School of Business Summer REACH research grant.
Read the paper in Small Business Economics.
Learn more about Prof. Ting Zhang.