Homeworking: how does it add up?

There are clear economic benefits to working from home – but what about the wider costs?

Gallup said that by April 2020, over half of all U.S. workers, accounting for over two-thirds of U.S. economic activity, were working remotely. This pattern was repeated globally, and the impact is visible in every business district.

Quiet streets, shops and offices speak to the millions working from home as we strive to survive. Some believe city centers have entered permanent decline. The travel and hospitality industries are collapsing, dozens of airlines shuttered, and over-exposed AirBnB owners are entering bankruptcy.

Some challenges will require government intervention to resolve, particularly in service-led economies. What will happen to those in lower-paid jobs who no longer have work in those service-led retailers? Training and support will need to be provided. The Brookings Institute suggests a patchwork of government and business-led initiatives to reskill workers left jobless in sectors damaged or destroyed by the pandemic through no fault of their own.

Remote working also leaves people isolated, and a mental health crisis is widely predicted – at the same time, there is evidence that people are cutting back on non-essential spending. In June, Visa reported a 21% decline in credit card spending. That’s good in terms of savings habits but will impact the credit-based economy.

Public transport is suffering and in need of government bailouts. Providers cannot meet their costs as commuters swap trains and buses for private cars, bikes, scooters and walking. Commuters are reticent to share packed trains and buses with others, and mass transit usage data shows this.

The consequences of these industry transformations are vast, but distance and locality seem key to the future of service as new models evolve to serve the new normal.

Homeworkers are productive

The Marchetti Constant claims the average worker spends one hour commuting every day and has done so since Neolithic times. With remote working, workers have been able to claim that hour back.

There is evidence that this time is being used to boost productivity. One Harvard study suggests this works out to be around 48-minutes of extra work per employee per day. To put that into perspective, this is a bigger increase in productivity than was unleashed by deregulation or privatization and may perhaps help some economies pay for the impact of the crisis.

Office as a service

While it’s tempting to believe every employee has the wherewithal to work effectively from home, many don’t. Homeworkers complain of problems sourcing robust broadband infrastructure and experience frustration creating clear boundaries between work and family time.

While the intensity of lockdown varies on local, regional and international bases, those geographies in which cafes and restaurants are permitted to operate are witnessing increasing numbers of workers choosing those spaces in preference to home.

This is prompting changes in commercial real estate. Some companies are downsizing, while others seek more COVID-secure premises. Office design will change to reflect this: how many people can you fit into an elevator while maintaining social distancing? Low-rise office complexes will become prized as employers transition to offer “office as a service.”

What about well-being?

Remote working leaves people isolated. Mental Health America recently revealed that over 169,000 Americans are suffering from severe depression or anxiety related to the pandemic – and yet, staff are critical to business survival.

“Businesses are finally starting to acknowledge the critical role that mental well-being plays for their workers, but this can be harder to manage when people are at home working,” acknowledges Wolfgang Seidl, EMEA Health Management Leader, Mercer Marsh Benefits. “Physical health may pose problems, too, as employees continue to be at risk of catching the COVID-19 virus, with some even suffering from Long-COVID, where they show symptoms for several months after testing positive.”

HR must also cater for more complex workforces, potentially across multiple nations. Creative responses are emerging. Employers are offering their workers furniture from their offices on long-term loans and are providing subsidized broadband and digital wellness services.

Middle management feels the pain

While many employers claim to be satisfied with the results of the WFH experience, there’s a cohort of middle management who must change their staff management approach from presenteeism toward one based on tasks or results.

Some employers maintain constant video contact during the working day. Rather than tolerate such surveillance, employees are seeking achievement-based roles, leaving management with the challenge of recruiting good staff remotely.

While staff oversight may be an issue, employers do now have more flexibility in terms of recruitment – so long as a new hire has the skills, their location makes little difference. Digitally nomadic lifestyles will increase.

Property values are changing

Retail sales are returning to near normal levels, as consumers switch spending from services to hardware (including garden heaters). With some exceptions, such as Hong Kong, Seoul, Singapore and Tokyo, the long-lasting social and economic consequences are being felt in the inner cities where wealth inequality was already at unsustainable levels pre-pandemic.

Life has already become more normal in many rural and isolated areas. People working remotely from their holiday cottages get the best of all possible worlds. This is prompting property prices in rural areas to climb as some seek to exploit the WFH opportunity.

Businesses can prepare for disruption with robust contingency plans for telecommuting. In this ebook, we share tips on a fast and seamless transition to remote work arrangements. And this webinar on cloud collaboration can help businesses improve the work-from-home experience in the longer term.

Jon Evans

Jon Evans is a highly experienced technology journalist and editor. He has been writing for a living since 1994. These days you might read his daily regular Computerworld AppleHolic and opinion columns. Jon is also technology editor for men's interest magazine, Calibre Quarterly, and news editor for MacFormat magazine, which is the biggest UK Mac title. He's really interested in the impact of technology on the creative spark at the heart of the human experience. In 2010 he won an American Society of Business Publication Editors (Azbee) Award for his work at Computerworld.