Three years after working from home became a widely accepted practice, organizations are still struggling to figure out the ideal arrangement for their workforce. As many companies come back to work post-summer breaks, we see the headlines continue to roll in highlighting the divergence of opinion. Why do companies continue to grapple with an issue that appears settled? It turns out the answer is more complicated than it seems.
At its peak during the pandemic, remote work was estimated to account for about 50% of paid work hours, according to the U.S. Bureau of Labor Statistics. Around the world, this figure varied by country. In Australia, France and the UK, 47% of employees worked fully remotely during lockdowns in 2020, but since the fall of 2020, that figure has steadily declined, with hybrid schedules commonly found in workplaces around the world. But even though many organizations have settled on such arrangements, some business leaders still want to raise attendance in the workplace.
Just recently, many notable companies have renewed calls for higher in-person attendance, including Meta, Amazon and even Zoom, which has benefited greatly from remote work. CEOs at these businesses have made it clear that in-person collaboration drives higher engagement and, consequently, innovation and productivity. And there is considerable evidence to support their claim – to some extent. It’s also clear that many are responding to the high costs of office real estate that they continue to incur.
Productivity depends on the work
According to research recently conducted by three North American university professors, employees who worked fully remote were 10% to 20% less productive than colleagues who were fully on site. On the other hand, those who worked a hybrid schedule were around 5% more productive. A Stanford University experiment also found that in-person teams generated 15% to 20% more ideas than remote teams working on the same problem. Even so, not all work can be done remotely which is another factor when thinking about flexibility. Furthermore, leaders believe that being physically present helps employees connect with each other in ways that can’t be replicated online.
On the other hand, remote work has also created many benefits and opportunities for businesses. Access to a global and more diverse talent pool is one of the most compelling as companies that struggle to get critical skills can now look beyond the borders in which they operate. Along with this is potential for labor and facility cost savings, since employers can hire at lower wages and operate with fewer offices. Most importantly, however, hybrid schedules have allowed workers to achieve a work-life balance they have long wanted.
Flexibility with intentionality
So how will employers strike an optimal balance that accommodates the desire of their people while preserving innovation and productivity? Policies based on flexibility with intentionality will likely prevail as the most effective and popular. This is achieved by addressing workforce needs in a way that also promotes culture, performance and engagement. Doing so positions companies to not only succeed but also stand out as an employer of choice.
As a CEO, I support job flexibility because it can strengthen an organization as long as the practice is executed with intentionality. This requires taking into account organizational, team and individual circumstances and how best to apply policies based on unique needs. For instance, make it clear that in-person attendance is necessary when synchronous working is required. Conversely, asynchronous tasks may be better performed at home, where employees can focus and reflect with fewer distractions.
In most organizations, this will probably mean hybrid work weeks consisting of at least one-third of time spent in the workplace. Research conducted by Boston Consulting Group shows that it’s an arrangement agreeable to both managers and their employees, but only if staff have a say on their schedules. People still want flexibility to accommodate their personal obligations, such as caring for a family member or to avoid especially grueling commuting days. Our research suggests that this desire is equally relevant for office as well as non-office bound workers; the appeal is universal.
Work-life balance underpins retention
Working from home is a phenomenon that has existed for decades but it has evolved tremendously during the past three years. I have no doubt that flexible schedules will persist and for good reason, despite the call of some business leaders for their employees to return to the workplace permanently. People’s desire for a healthy work-life balance only rose after the pandemic, affirming a long trend that Randstad has documented for the past 20 years. In fact, our 2023 Workmonitor data revealed that 78% of workers surveyed said they have a good work-life balance, and a majority would not accept a new job if it negatively impacted this. These findings show progress made toward a healthy work schedule.
Employers will do well to create clear and fair policies aligned to the wishes of their teams while advancing the interests of the organization. Doing so will ensure a workforce that is loyal, motivated and goal oriented, ultimately benefiting companies over the long term.
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