posted 22nd July 2024
Overview
In October 2022, the UK Parliament published a POSTbrief (articles produced by the Parliamentary Office of Science and Technology) on the impact of remote and hybrid working on both workers and organisations; one of many reports being published worldwide that attempted to gauge whether the significant post-pandemic shift away from full-time office work was a good thing. The takeaways from this POSTbrief were not a great departure from most other reporting at the time. Flexible working seemed to have both positive and negative impacts on workers in areas such as productivity, work-life balance, worker mental health, and both positive and negative impacts on organisations in areas such as productivity, staff wellbeing and overhead costs. Overall, however, the report suggests that employees and organisations were, at the time, both significantly more likely to prefer hybrid working. Indeed, hybrid working was, at that time, broadly and frequently believed to be the way of the future.
Indeed, by 2023, 28% of employees worldwide reportedly worked remotely, with the tech industry having the highest share of primarily remote employees at 67% worldwide. However, the wider narrative around hybrid and remote work was, perhaps unexpectedly, shifting. Major employers (notably including Amazon, Disney and banks such as JP Morgan Chase and Goldman Sachs) had started to request employees attend the office - some transitioning from a fully-remote workforce into a hybrid one, and others asking for a return to full-time in-office work, with many of these mandates soliciting public backlash from employees (see: Amazon introducing a RTO mandate, leading to a petition signed by 30,000 of its employees, with 1,800 pledging to leave their jobs - a petition which was ultimately rejected).
But that initial backlash didn't seem to slow down the trend-reversal. One report, released in December 2023, indicated 90% of companies were planning to implement RTO policies by the end of 2024 and KPMG published research in October 2023 that showed 63% of CEOs believed a full return to in-office work by the end of 2026.
By 2023, 28% of all employees and 67% of tech employees globally worked remotely
This growing tension between employees and these medium and large organisations, with employees still overwhelmingly reported as preferring flexible working, has continued through to this year. Fortune's 100 Best Companies to Work For list for 2024 identified the opportunity for Remote Work as one of the key "distinguishing characteristics of great workplaces" - with only two of the total 100 companies on the list requiring employees to be onsite for four or more days per week. Crucially, Fortune notes that gone are the days of firms like Google topping their list - Google having had its own very public reversal on home-working policies in 2023. Research released by Scalable Software at the beginning of the year stated that 35% of office workers expressed resentment over being asked back into the office, with 50% expressing a belief that their employers are suffering from something termed 'productivity paranoia'.
A year after publishing its' research claiming 63% of CEOs foresaw a full return to in-office work by the end of 2026, KPMG posted new survey results walking back those claims significantly. By April 2024, just one third of CEOs believed there would be a full return to the office in the next three years, with nearly half of the CEOs surveyed stating that they felt hybrid working was here to stay. The predominant reason for this? The employee backlash RTO mandates were repeatedly met with.
But is that the end of the story? Is the definitive answer truly the happy compromise between in-office and remote that hybrid seems to offer?
The Landscape in 2024
The ONS reports that between 22 May and 2 June 2024 , of the workers currently employed in the UK, 14% worked entirely from home and 26% had a hybrid working arrangement, with the remaining 60% working only in the office.
The current job market does not reflect this same current 2:3 split. Data recorded from Indeed for June 24 shows just under 8% of jobs advertised in the UK offer flexible working, with London offering a slightly higher percentage of opportunities.
Table 1: All Job Ads by working location - Jun 24. Source: https://uk.indeed.com
| Location | Total | Hybrid | Hybrid % | Remote | Remote % | Total Flex Working | Total Flex % |
|---|---|---|---|---|---|---|---|
| UK | 333,023 | 21,152 | 6.35% | 5,099 | 1.53% | 26,251 | 7.88% |
| London | 64,360 | 6,190 | 9.62% | 733 | 1.14% | 6,923 | 10.76% |
It is likely that these numbers represent a lower proportion of opportunities "knowledge" (or desk) workers, who are more likely to be able to carry out work in flexible locations (although it should be noted that the ONS data also covers all UK workers, regardless of industry).
Looking at technology roles specifically, however, we see that broadly the split of opportunities shifts significantly closer to the 40% of flexible workers as reported by the ONS. Here, the number of flexible workers in London actually falls just under the UK total.
Table 2: Technology Job Ads by working location - Jun 24. Source: https://uk.indeed.com
| Location | Total | Hybrid | Hybrid % | Remote | Remote % | Total Flex Working | Total Flex % |
|---|---|---|---|---|---|---|---|
| UK | 25,403 | 8,302 | 32.68% | 2,232 | 8.79% | 10,534 | 41.47% |
| London | 9,874 | 3,267 | 33.09% | 466 | 4.72% | 3,733 | 37.81% |
Notably, the percentage of current fully remote adverts is less than that of those currently working completely remote - almost 9%, rather than 14% as the ONS reports. The number of hybrid adverts is higher than the 26% reported by the ONS across all locations highlighted in Table 2, perhaps corroborating current reports that hybrid working is the preferred happy medium across businesses (or at least for technologists).
Flexible Working vs. Productivity
When discussing flexible working, one of the biggest concerns is its impact on productivity. In the past four years since the COVID-19 pandemic, numerous research has been published arguing both that flexible working increases productivity, and that it significantly harms it.
The continued volatility of research around this begs a number of questions around what exactly is being examined. Chief of these being: how should productivity be measured? Is the concept of 'productivity' being consistently defined across organisations? Should 'productivity' even mean the same thing to every business?
In 2023, Slack published its annual 'State of Work' review, which asserted that, in practice, the concept of 'productivity' seemed to be more about "generating high inputs (such as resources used, time spent at work and code written) to appear productive", as opposed to outputs . That is, workers who look busy were more likely to be seen as productive, regardless of the results they generate through their work.
This isn't a new issue in remote working. In 2020, Harvard Business Review published an article titled 'Remote Managers Are Having Trust Issues'. The article discusses research showing that where managers are unable to "see" a worker, they may start to lose trust that the worker is indeed working.
The concept of 'productivity' is measured more on "generating high inputs (such as resources used, time spent at work and code written) to appear productive", as opposed to outputs
As a result, this can lead to the "unreasonable expectation" that workers should need to be available at all times, in order to disprove this doubt. This in turn can ultimately disrupt the home-life balance of workers and increase job stress. Only 7% of workers experiencing low levels of monitoring felt "often or always anxious" whilst working - a number that shot up to 49% among those experiencing high levels of monitoring. The Slack 2023 State of Work review seems to corroborate this, with 27% of managers determining "visibility and activity metrics" as their way of measuring productivity, and 53% of desk workers feeling "pressure to respond to messages quickly, even if sent after work hours".
The data shows something of a self-fulfilling prophecy - where managers feel unable to trust their employees and increase levels of monitoring as a result, workers are more likely to experience stress and anxiety whilst doing their job and consequentially, are less likely to be productive in their role.
It may seem, then, that implementing an in-office policy would resolve those issues. A report published by workplace tech company Envoy states that 95% of leaders admit to recognising contributions of on-site employees more regularly than those working from home. Interacting at a face-to-face level inevitably leads to increased work visibility, easier and quicker communication and more avoidance of doubt.
95% of leaders admit to recognising contributions of on-site employees more regularly than those working from home
This does not, however, seem to play out in data. In companies that have enacted RTO mandates, just 1 in 3 managers are reported by Atlassian to feel that in-office work had even a small impact on worker productivity.
And of course, avoidance of doubt is not the same as improved trust - where employees believe they have experienced a lack of trust (and increased monitoring), there may be residual resentment that remains. Research from Institute for Corporate Productivity found that higher levels of lateral trust between workers and leadership within organisations leads to greater productivity. The factors identified as affecting trust were mass layoffs, high employee turnover and, of course, remote working. Specifically, the research states that whilst digital monitoring and RTO mandates might give the illusion of productivity, in reality they do very little to motivate workers. Similarly, a study published in January 2024 examining the effectiveness of RTO mandates on a sample Standard and Poor's 500 firms showed no significant changes for firms in financial performance. It did, however, show "significant declines in employees' job satisfactions".
To effectively understand whether an employee is working effectively in a remote setting, many companies have taken to redefining their understanding of what 'productivity' is to them. Tech company Atlassian identify a key part of their approach as measuring outcomes rather than tasks, with OKRs, continuous goal-setting and regular progress tracking.
For all that 'productivity' is possibly the hottest topic in the discussion of flexible working, it may in fact be little more than a red herring.
Flexible Working vs. Employee Satisfaction
The prevailing reason why organisations have struggled with RTO mandates is the most obvious one: workers place high value on flexible working.
In the May - June 2024 ONS report gathering public opinions on working arrangements, 78% of employees working at least a portion of their role from home felt that doing so offered them an improved work/life balance. Around 50% of those workers felt they had fewer distractions, that they could complete their work quicker and that the arrangement improved their overall wellbeing. Only 8% felt that flexible working offered no advantages.
Beyond this, working from home can hold disproportionate benefits for some employees. Research published by TUC in March 2024 focused on the experiences of BME workers working in hybrid roles and implementing hybrid working from an inclusivity standpoint.
Of employees in the study who had carer responsibilities (to a parent or other family member), 37% cited hybrid working as essential, and that they would look for a different job if hybrid work were no longer an option. In the same research, 33% of disabled employees and working parents, as well as 32% of employees with a mental health condition, said that they would leave their role if it ceased to offer hybrid working. 85% of disabled employees in the same study felt they worked more productively at home and 70% felt that working in the office would negatively impact their physical or mental health.
A study published by Lancaster University similarly found that hybrid and remote work offered greater accessibility for disabled workers. 80% of the disabled workers surveyed felt home-working to be either essential or very important to them when looking for work. 65.8% of disabled workers surveyed ideally want to work remotely 4-5 days a week. But is that all there is to it?
78% of employees working at least a portion of their role from home felt that doing so offered them an improved work/life balance
The May-June 2024 data also flags that 48% of employees working remotely find it harder to work with others, with 26% reporting to experience more distractions at home than in the office.
The way in which an employee works from home can have a great effect on that employee's experience. Those with a private home office and no one else at home during work hours are likely to have a very different view on home working to someone working on their dining table in a crowded flat, or with young children at home during the workday.
Working at home can have negative impacts on the mental health of employees - loneliness has been widely reported as a reason why workers may prefer to be in the office, at least for a few days of the week, where they're able to socialise with fellow employees.
The increased difficulty that dispersed teams pose to communication don't only have the potential affect workers' mental health - it can be more difficult to work effectively on collaborative projects, for instance, when employees aren't in the same room. Learning and mentoring, particularly for those at the beginning of their career, has the potential to greatly suffer from remote working, as does general team alignment.
There are, however, ways to resolve these issues. A strong focus on company goal alignment, an understanding of what productivity looks like and investing in collaborative tools outside of the office can be excellent places to start. Reshaping offices so that they can both encourage collaboration but also offer quiet focus spaces can help to fulfil the needs that workers may not get from simply working at home. Beyond this, introducing flexibility in other ways can help to encourage workers into the office without impacting their satisfaction. Large companies are starting to look at options such as four-day work weeks and flexible start/end times to try and address their employees' needs, whilst still encouraging greater team collaboration and productivity.
Sources:
https://post.parliament.uk/research-briefings/post-pb-0049/
https://www.statista.com/topics/6565/work-from-home-and-remote-work/#topicOverview
https://www.businessinsider.com/companies-making-workers-employees-return-to-office-rto-wfh-hybrid-2023-1
https://www.businessinsider.com/amazon-return-to-office-policy-petition-30000-staff-remote-work-2023-3
https://www.businessinsider.com/amazons-hr-boss-rejects-employee-remote-work-petition-2023-3
https://www.resumebuilder.com/90-of-companies-will-return-to-office-by-the-end-of-2024/
https://fortune.com/2023/10/05/ceo-rto-kpmg-research-return-to-work-full-time-5-days/
https://fortune.com/2024/04/04/fortune-best-companies-to-work-for-list-2024-hybrid-work/
https://www.yahoo.com/tech/google-officially-changed-mind-remote-204500513.html
https://itbrief.co.uk/story/uk-workers-resent-office-return-amid-productivity-paranoia-claims
https://fortune.com/2024/04/12/kpmg-study-us-ceos-accept-hybrid-working-employee-return-to-office/
https://www.ons.gov.uk/peoplepopulationandcommunity/wellbeing/datasets/publicopinionsandsocialtrendsgreatbritainworkingarrangements
https://slack.com/intl/en-gb/blog/news/state-of-work-2023
https://hbr.org/2020/07/remote-managers-are-having-trust-issues
https://envoy.com/ebooks/workplace-gaps-between-employees-and-executives
https://atlassianblog.wpengine.com/wp-content/uploads/2024/01/lessonslearned.pdf
https://go.i4cp.com/productivity
https://papers.ssrn.com/sol3/papers.cfm
https://atlassianblog.wpengine.com/wp-content/uploads/2024/01/lessonslearned.pdf
https://www.ons.gov.uk/peoplepopulationandcommunity/wellbeing/datasets/publicopinionsandsocialtrendsgreatbritainworkingarrangements
https://www.tuc.org.uk/research-analysis/reports/making-hybrid-inclusive
https://www.lancaster.ac.uk/media/lancaster-university/content-assets/documents/lums/work-foundation/TheChangingWorkplace.pdf
