People & Human Resources

Working from home may have a bad rep, but is this really justified?

Martin Kovacs /

The idea of working from home may be looked upon unfavourably by some employers, however those with a rigid mindset may do well to reconsider.

Working remotely is becoming increasingly common in the digital age, and, far from seeing a decline in productivity among those who work from home, recent research points to the opposite being the case.

As outlined at TED, research conducted by Stanford University economics professor Nicholas Bloom shows companies could not only benefit from a reduction in costs associated with office space, but also see improved productivity from employees who work from home.

Bloom notes in his TEDx talk, ‘Go ahead, tell your boss you are working from home’, that while suspicion may reign about what employees get up to while on the clock at home, his research shows the reality is divorced from popular conceptions.

The research involved Bloom and James Liang, co-founder and chief executive of China’s largest travel agency Ctrip, designing a randomised controlled trial testing remote work.

With more than 500 employees in Ctrip’s call centre volunteering to participate in the trial, about half met the required qualifications, including having a private room at home from which to work, having been with Ctrip for at least six months and having decent broadband access.

The test, which was conducted over nine months, involved those with even-numbered birthdays selected to telecommute four days per week, with those with odd-numbered birthdays remaining in the office as a control group.

Unbelievable results

The results, Bloom states, were “unbelievable”.

“Ctrip saved [US]$1900 per employee over the course of the study on office space, and we knew this would happen,” he comments.

“But to our amazement, the work-from-home employees were far from goofing off — they increased productivity by 13.5% over those working in the office. That’s like getting an extra day’s work from each employee.”

Beyond productivity, the attrition rate for stay-at-home workers was 50% lower than those who worked in the office, with remote employees also reporting higher job satisfaction.

However, more than half of the volunteer group changed their minds about working from home due to feeling too much isolation.

Companies stand to gain and should consider all options

It may be that companies want to consider a range of work-at-home options, such as on a contingency basis due to severe weather conditions or due to the individual circumstances of an employee.

“My advice for companies who are curious is to examine different ways to do it,” Bloom states.

Working both in the office and at home may provide the ideal mix, while companies should also keep in mind that the option to work at home may also attract potential employees.

“The need to go into a workplace five days a week started because people had to go to a factory and make products,” Bloom comments.

“But companies that still treat employees like that are increasingly finding themselves at a disadvantage.”

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Martin Kovacs

Martin Kovacs is a journalist with experience covering the IT, consumer electronics, retail, finance and energy sectors.

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