Ready to debunk the beliefs of return-to-office evangelists?
What does a productive day look like for you? Depending on your job, you might measure it in meetings attended, emails sent, customer questions answered, or lines of code written.
Even though working from home has its critics, recent studies prove people can be just as productive—sometimes more so—working remotely. Whatever tasks you may be doing, you’re probably not doing less of them at home than you were at the office.
The problem is, there’s no one clear way to define productivity. And some tasks, such as research or brainstorming, are hard to measure and even harder to monitor.
As companies try to decide whether to adopt remote, Virtual First or hybrid policies—or return to office full time—many are struggling to satisfy the competing preferences of workers and managers. They’re looking for proof that employees aren’t just pretending to work from home (WFH). To navigate an effective way forward, companies need data.
Fortunately, Stanford University economics professor Nicholas Bloom and a team of researchers published two new studies that debunk the beliefs of return-to-office evangelists.
In July, a study of Trip.com found that coders were able to maintain the same output while working remotely. Then, in September, an even more extensive study showed that most employees across 27 countries were pleasantly surprised by their self-assessed WFH productivity during the pandemic—and even willing to take a 5% pay cut to have the option to WFH two to three days per week.
Given the growing evidence that remote work can actually improve productivity, reduce attrition, and cut the costs of commuting, why are so many still resistant to adopting permanent policies that benefit both the employers and employees?
Overcoming a long-standing stigma
When James Liang, chairman of the board at Trip.com, announced the company would be evaluating a hybrid policy, managers were skeptical and workers were reluctant to volunteer.
“They thought it would slow down their workflow,” says Ruobing Han, a co-author of the Trip.com study. “They didn’t want their employees to participate. That's why, in the first round, slightly less than half of the employees volunteered. They were saying, ‘I don’t want to participate. I’m afraid you’ll have monitoring software installed in my laptop.’”
Three months into the experiment, though, the team changed their attitude. One key revelation was that it took almost no time for workers to adapt. Han attributes this to the pressure of deadlines. Teams had to quickly figure out which tasks they could do at home and which required meeting in the office.
Seeing how easily his employees made the transition to hybrid work, Liang rolled out the policy to the rest of his workforce and now plans to expand the hybrid policy to allow even more WFH days. Decisive leadership and encouragement from the top were crucial factors in the success of the experiment.
Han says societal attitudes and culture play important roles as well. “If you look at countries like Singapore and Japan who have similar living standards [compared] to the States, their return to the office seems to be much more successful,” he observes. “I think culture plays a role. [For] young employees in Asian culture, hierarchy matters more. They value face time with their boss.”
The way a company values presenteeism is often determined from the top down—but prioritizing face time doesn’t always translate into meaningful improvements in culture and productivity. The study supports the idea that the more an employer encourages WFH, the more employees tend to respond positively.
Converting the commute into overtime
Interestingly, research shows when workers are allowed to set their own schedule, many will overdeliver because they’re less aware of working hours and more focused on finishing what they’re doing. In fact, a study at Github showed that during the pandemic, the share of work done by the developers increased during the weekends.
“There can be a lot of after hours work because of the pressure to complete a task,” says Pablo Zarate, co-author of the second study, Working From Home Around the World.
For many, though, that’s a fair trade off to escape a grueling commute. And while a lot of media attention is given to the ways people convert their commute into walking, resting, or relaxing with their families, a surprising number are staying in the zone to complete their tasks.
“One of the things we asked people is, if they are saving time coming in, what share of that time are you using to work?” says Zarate. “It turns out, on average across countries, 40% of the commute time is directly used in working.” Even though the percentage varied from country to country, the study consistently found that less commute time translated to more time available to work.
“That's the dimension we're currently exploring: what are people doing with their commute time?” says Zarate. “Hopefully next month, we’ll have a more defined study of that.”
WFH continues despite the tension
Something that surprised the researchers about the shift to remote work was just how consistent the WFH experience has been for workers around the world.
“It turns out, on average across countries, 40% of the commute time is directly used in working.” —Pablo Zarate
“These countries cover about two-thirds of the world GDP. So although these are a small number of countries, in terms of GDP, they occupy a large share,” explains Cevat Giray Aksoy, another co-author of the global WFH study, associate director of research at the European Bank for Reconstruction and Development, and assistant professor of economics at King’s College London. “What we find is that WFH averages 1.5 days per week in our sample—ranging widely across countries—even after the pandemic.”
In addition to finding that WFH days are continuing for knowledge workers around the world, the study also shows that employees want more WFH days than employers plan to give them.
“There is a one-day gap across countries on average,” says Aksoy. “Despite the fact that, during the pandemic, employees were satisfied and think they were more productive when working from home, employers still think they should go back to the office.”
Researchers noticed a strong correlation between employer plans and employee success. The more prepared companies were with an established policy that provided specific rules and guidelines, the more employees could avoid guesswork and embrace the new world of WFH.
Would you pay for the privilege to WFH?
Another finding that surprised researchers was that workers said they’re willing to take a pay cut to have the option to work from home two or three days per week. “People really take into account how much money they spend when they commute, and also the time cost is huge,” says Aksoy.
“What we find is that [on average] workers are willing to pay about 5% of their salary for the option to work from home,” says Zarate.
Ultimately, Zarate thinks flexible work arrangements might become a compelling benefit to attract and retain employees. “In addition to our study, there is vast literature that looks at the willingness to pay for different job benefits or working arrangements. In the end, the option to work from home is a benefit in the same way as it could be for flexible hours.”
“What we find is that workers are willing to pay about 5% of their salary for the option to work from home,” says Zarate.
In search of best practices
Though it’s been a few years since the world began shifting to remote work, there’s still a lot we have yet to learn. At Trip.com, Han says they’ll be monitoring what happens when everyone at the company is given the opportunity to take advantage of the hybrid policy. “I think what we’ll find is that people adapt and learn how to coordinate in this hybrid arrangement pretty fast.”
Meanwhile, Aksoy and his team are planning a study of management practices in the context of remote work. “We know from other studies, good management processes can make a big difference, not only in terms of productivity, but also in terms of workers’ satisfaction,” he says.
They’re now in the process of designing a randomized control trial with the largest call center company in Turkey. “One thing we don't know is: what are the best management practices when everyone in your team works from home. So in that randomized control trial, we will try to address that. I'm really excited for this project, because we don't know what is the best practice out there.”
Other studies show that a growing number of technologies—like video conferencing—have evolved to address some of the gaps discovered during the pandemic. That makes Zarate optimistic about the future of remote work.
“Before the pandemic, we weren't really aware how incredibly helpful this technology could be, not only for work, but for teaching as well,” he says.
As he sees it, the new tools aren’t a replacement for the in-person experience, but a supplement to them. “For example, in academic events, a seminar that was previously only in person, most [now] also have the option to attend in Zoom. That's really convenient. I think a similar thing will happen with remote work.”