Four years ago, when the world of work was upended by the Covid pandemic, there were confident predictions that a permanent shift to remote work would follow the lifting of lockdown restrictions.
Clearly, a lot has changed since then. Some of the early preachers of the brave new world of remote working – including US tech companies Google and Microsoft – are among the most repentant.
This week, Amazon joined their ranks, issuing an edict for corporate employees to return to the office five days a week starting January 2. CEO Andy Jassy argues that in-person work has “significant” advantages.
Others, such as Goldman Sachs, Boots and Barclays, agree, as more companies push to limit remote work. At Tesla, Elon Musk has a typically blunt approach, telling employees who are not willing to return to the office full-time that they can “pretend you work somewhere else“.
However, it is also clear that the pre-pandemic working landscape will never be fully rebuilt. After the initial push to get employees back into the office after lockdown, flexible practices and the balance of power between bosses and workers are back on the agenda as the new Labour government promises a radical shake-up of employment rights. Plans, expected within weeks, include making flexible working the default option for workers from day one on the job.
Since the last lockdown ended three years ago, most employers have introduced some form of mandatory office-based working requirement. However, VirginMedia O2 research suggests that only a minority four out of ten companies – Demand staff are at their desks five days a week.
Over time, this figure could rise: a KPMG survey of UK chief executives published on Wednesday reports that 83% believe there will be a return to pre-pandemic ways of working within the next three years, up from 64% a year ago.
Still, many bosses feel that a one-size-fits-all approach remains inadequate, and acknowledge that, in the right circumstances, hybrid and flexible work arrangements are valuable tools. Even Amazon knows this, as remote work is still permitted with management approval. The company also offers a four-day work week and flexible contracts in its warehouses.
Remote work usage will naturally vary across occupations. For factory workers and train drivers, there aren’t many options; while in IT and professional services, adoption is often split along generational lines or determined by career stage, living conditions and caring responsibilities. Research shows that Generation Z workersEarly in their careers, they are more likely to commute to the office.
An often overlooked fact is that home workers are a minority in Britain, and always have been, even at the height of the pandemic when the level reached a peak of 49% of all working adults in the first half of 2020.
Official figures, which threaten to further atomise a workforce already plagued by inequalities, show that workers in the highest income brackets, with university degrees and in professional occupations were the most likely to work from home. Residents of London reported the highest levels.
At the height of the pandemic, more than 70% of all staff in the Richmond upon Thames borough worked from home at some point in 2020, the highest rate in the country, compared with less than 14% in some northern English towns including Burnley and Middlesbrough.
Another growing gap is between workers in British and public sector companies, where hybrid working is more established, and those whose owners are based abroad and who push for in-person interaction. Wall Street banks such as Goldman Sachs, for example, require staff to come into the office full-time, mirroring policies in place for American colleagues.
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Opinions about pros and cons can be stubbornly held, as demonstrated by the status of home working as a culture war front under the previous Conservative government, when Jacob Rees-Mogg would leave passive-aggressive notes on the desks of absent civil servants.
Highlighting how utilisation can depend on management preferences, Nationwide, under its former boss Joe Garner, launched a “work from anywhere” policy in 2021, only for his successor Debbie Crosbie to scrap it last year.
Economists are divided on the productivity benefits. Goldman Sachs has highlighted academic studies from the past decade that range from -19% to +13%. Working from home means eliminating commutes, which can benefit mental health and could mean fewer distractions, but not always.
Co-location can bring productivity benefits, helped by the exchange of ideas, based on research dating back to Victorian economist Alfred Marshall, who studied the clustering of Lancashire cotton mills, and John Maynard Keynes’s idea of the “industrial district”.
In the 21st century, however, new technologies had been driving remote working practices long before the Covid pandemic: the rise of home working during lockdown only accelerated a shift that was already underway.
Some studies have shown that hybrid workers are just as productive as full-time workers, are less likely to quit, and can help businesses save money on office costs. The latest surveys from the Office for National Statistics show that more than 20% of businesses are using, or intending to use, increased home working as a permanent model – a proportion that has been steadily increasing over time.
“We therefore doubt that Amazon’s announcement is the start of a trend,” says Matthew Pointon, an economist at consultancy Capital Economics. “Indeed, moving to a full-time office model would not even be possible for companies that have already reduced the size of their offices, such as HSBC and Clifford Chance.”
