Catherine Rusoff
It’s much easier to shop online during the workday when you’re sitting in the privacy of your home – where your boss can’t catch a glimpse of your computer screen. Other aspects of remote work, like the fact that you don’t pass by the grocery store on your daily commute to the office, also make online shopping convenient.
This explains why remote work – which became the norm at the height of the pandemic and has remained to some extent – helped generate an additional $375 billion in online spending last year, a new report of Mastercard Economics Institute programs.
“A lot of spending has come from the increase in people working from home,” Nicholas Bloom, a labor economist and economics professor at Stanford University who co-authored the report, told CBS MoneyWatch. “We saw about $400 billion in extra spending and that appears to be related to working from home. If I’m at home, it’s more convenient because I can easily place orders without anyone looking over my shoulder if your laptop screen is facing outside and people see you shopping for clothes.”
In US zip codes, where a large portion of the population works remotely from home, levels of online spending have increased, the report finds. The reverse also applies to ZIP codes, with few people working remote jobs.
The same trend also occurred internationally. In countries with fewer work-from-home opportunities, spending on online shopping is roughly the same as before the pandemic, while it increases by around 4% in countries with many remote work opportunities.
Other lasting effects of the pandemic, such as the migration from cities to suburban areas, also contributed to an increase in online spending compared to in-store in 2023, according to the report. “We saw large amounts of migration emerging from the pandemic, and some of it was moving out of concentrated urban areas, which perhaps requires online shopping,” Michelle Meyer, chief economist at the Mastercard Economics Institute, told CBS MoneyWatch.
Working from home also allows consumers who were previously wary of so-called porch pirates who steal expensive deliveries to their door, and therefore prefer to shop in-store, to be home to receive those packages. “It’s easier to accept deliveries of expensive items – you can track them and pick them up as soon as they’re delivered,” Bloom said.
Scott Baker, an associate professor of finance at the Kellogg School of Management who also worked on the report, said he observed what he called a “learning effect.” People who had never shopped online before became accustomed to doing so during the pandemic and continued to shop online.
Retailers are also increasingly meeting consumers online, launching promotions to try to encourage them to spend more. But that 10% discount code or free shipping coupon that seems like a good deal is often just a ploy to separate Americans from their money. Personal finance professionals are warning against spending money to save it, or “spaving”, as the habit came to be called.
