Life After the Pandemic

Implications of More People Working From Home, More Often

One of the biggest social changes brought about by the pandemic and efforts to combat it is a massive shift toward more of the U.S. population working from home, more often.

Such a massive shift in work patterns has significant implications for spending across the economy.  Here we highlight some key changes to spending on


Of course, there is a sizeable group of people who already spend most of their time at home--retirees.

So, we look at comparisons between worker and retiree spending habits to gain some insight into how a large, sustained shift toward working from home might affect consumer spending in these four areas.



of away-from-home spending is on breakfast and lunch, two categories at serious risk from the shift to working from home.


The shift to telecommuting by a significant portion of the workforce could drive an increase in annual maintenance and repair spending of up to
$40 billion.

32% increase in annual maintenance and repair spending by wage and salary earners

Home repair retailers and building materials companies will benefit.


Wage and salary earners' potential impact across apparel:

Less need for office attire means we could see a loss of up to
$26 billion
in annual spending on apparel overall.

Negative implications for department stores, specialty apparel retailers, as well as related businesses, such as dry cleaning, alterations, etc.


We see a cut of around 10% in transportation spending by workers, spread across vehicle purchases, fuel and maintenance costs.

Annual transportation spending across all industries may fall by as much as $130 billion.


Positive environmental impact

Significant Changes to Consumer Spending Have Important Investment Implications

We’re not epidemiologists, and we don’t suggest investing based on potential treatments or courses for the COVID-19 pandemic. But we do think it’s reasonable to look at the environment and changes to daily life wrought by the pandemic and ask if this represents a new normal. It seems clear that social distancing guidelines and pervasive cloud computing and communication technology have proved that working from home is possible and even desirable for a large percentage of the workforce. We don’t suggest everyone who can work from home will do so all the time, but that a larger percentage of the workforce will work from home more often than before the pandemic.

This is important because consumer spending powers our economy. Wage-earner spending accounts for roughly two-thirds of all spending, so even a small reduction has broad implications for the economy. And consider that the most likely work-from-home occupations are among the highest spenders on consumer goods.

The investment implications are clear in the earnings data we’re seeing and forecasting for the individual companies we follow:

  • Restaurants with significant breakfast and lunch exposure are experiencing difficulty.
  • In housing, we’re seeing better results for home repair retailers and building supplies companies.
  • Similarly, results across apparel and transportation stocks have been massively affected by the pandemic. 

We incorporate similar work and thinking into our earnings forecasts and evaluation for every stock we own.

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1Source: Bureau of Labor Statistics-Job Flexibilities and Work Schedules, avarages for the period 2017-2018.

2Source: Stanford Institute for Economic Policy Research (SIEPR), data from a survey of 2,500 U.S. residents carried out between May 21-29, 2020.

Source: American Century Investments and the U.S. Bureau of Labor Statistics Consumer Expenditure Surveys as of 12/31/2018, the latest data available.

Using annual expenditures from the BLS surveys in the four key areas shown, we calculated the difference in spending between wage earners (workers) and retirees who stay at home. We then determined the potential increase or decrease in annual spending if more workers were to follow similar spending patterns as retirees.

The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.