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What’s The Truth: Are We More Productive When Working from Home or Not?

CoAdvantage -Remote work seems to have stabilized post-pandemic. After hitting an initial high in 2020, when a little over 60% of paid full days in the U.S. were worked from home, remote work rates seem to have stabilized with around 40% of paid full days being worked from home through most of 2021 and 2022. In other words, two out of every five days on average are now working from home in the U.S.

Yet there seem to be growing calls from employers to return to the office. Half of the companies want their workers back in the office 5 days a week, according to research from Microsoft. Would such a return to the office help or harm the productivity of their workers?

Most employees and employers report greater productivity with remote work.

One study of 30,000 workers earning at least $20,000 per year found that nearly 60% reported being more productive than they expected. Only 14% reported getting less work done. Employers seem to agree that remote work hasn’t hurt productivity. A study from Mercer, an HR and workplace benefits consulting firm, of 800 employers found that 94% said their employees were as (or even more) productive when working remotely as when working from the office.

“Historically, there has been a perception in many organizations that if employees were not seen, they weren’t working—or at least not as effectively as they would in the office,” Lauren Mason, a principal and senior consultant at Mercer, told the Society for Human Resource Management. “And in most cases, this forced experiment around remote working as a result of COVID-19 has shattered those perceptions to prove that most employees can actually be trusted to get their work done from home.”

Reduced commuting time is a major source of productivity gain, but there are other ways remote work helps.

The study of 30,000 workers found that the underlying reason for increased productivity often came down to having more time available. “Three-quarters or more of the productivity gains that we find are coming from a reduction in commuting time,” one of the researchers wrote. Prior to the pandemic, the average U.S. worker commuted 54 minutes daily; for those working from home, about a third (35%) of that time gets reinvested into work.

Another study analyzing productivity data from the U.S. Bureau of Labor Statistics found that on days when they work remotely, people get up about 30 minutes later than on-site workers. Interestingly, researchers found that both groups slept about the same amount each night, so they speculate that remote workers are able to sleep a preferred schedule. “Teleworkers who spend less time commuting may be happier and less tired, and therefore more productive,” wrote the researchers.

In fact, working from home has more than just productivity benefits. “There are two angles for gain from this,” Nicholas Bloom, William D. Eberle Professor of Economics at Stanford University, told The Washington Post. “One is just productivity of people that can work from home. Our estimates are that it might increase their productivity by 3%, 4%, 5%. The other benefit that possibly is even larger, in the long run, is the positive impact on labor supply. There are a number of groups that are more able to work because of working from home.”

CoAdvantage, one of the nation’s largest Professional Employer Organizations (PEOs), helps small to mid-sized companies with HR administration, benefits, payroll, and compliance. To learn more about our ability to create a strategic HR function in your business that drives business growth potential, contact us today.