Remote work is declining, but bosses could regret their return-to-office push

The tussle between bosses and employees over remote work continues.

The tussle between bosses and employees over remote work continues. Photo: TND/Getty

The pandemic sped up the adoption of work-from-home arrangements, but pushback from unprepared employers in the years since has seen the number of Australians working from home drop.

Working from home is still more common among Australians compared to pre-COVID, but less than it was two years ago, Australian Bureau of Statistics (ABS) data released this week showed.

The number of Australians working from home had been slowly but steadily increasing prior to the pandemic, before jumping by more than 8 per cent between 2019 and 2021 to sit at 40.3 per cent.

By August 2023, the number dropped by more than 3 per cent, with 36.9 per cent of Australians working from home.

Experts told TND that employers are leading the charge in the downturn of work-from-home arrangements – but this comes against the wishes of much of the workforce, and severely limits talent pools.

Bosses on unsure footing with remote work

Gartner human resources advisory director Neal Woolrich said the high take-up of work-from-home arrangements in 2021 was an outlier, largely driven by lockdowns across Australia.

The drop seen in the ABS numbers is likely a “reversion to normal”, driven by employers enforcing return-to-office mandates for either hybrid or full-time in-person arrangements.

About 87 per cent of companies had implemented mandatory office days for staff by August this year, according to research by recruitment agency Robert Half.

Woolrich said while there is a strong preference from employees to work from home, there is a capability gap for management and leaders.

HR platform Employment Hero CEO Ben Thompson agreed that managers are largely untrained in how to effectively lead a team full of remote workers.

“If you don’t have the skills to train people who are working remotely, then the natural response to that is to get them back to the office where you do feel like you know how to manage somebody,” he said.

Adding further fuel to the opposition to remote working is the high cost of renting office space that could potentially spend a lot of time unused, and the initial difficulty of arranging well-structured hybrid working arrangements.

Thompson said many people in leadership positions likely fear a fall in productivity if employees worked from home more often; an issue that more education around tracking productivity from remote workers would help resolve.

Financial and ‘moral’ benefits of working from home

The decision to force employees back into offices could backfire, as Employment Hero research shows 50 per cent of hybrid and remote workers would consider quitting their jobs if their employer directed them to return to the office full time

Money is a big factor in the reluctance to return, as 78 per cent said working remotely at least some of the time is better for reducing the cost of living.

The average remote worker saved about $7500 per year on costs such as transport, work-appropriate clothing and housing as many were able to live further away from expensive CBDs, Woolrich said.

Thompson has experienced the personal benefits of transitioning to remote work since 2020, as he is now able to spend more time at home, where his wife is a full-time carer for their special needs child.

He said he knows his family’s story isn’t unique.

Many people are carers, and there is also a large cohort of people that have traditionally been excluded from the workforce because of their inability to work in offices due to disabilities, or living in remote areas.

“Everyone’s just like, ‘Oh, just get everyone back to the office’. They’re not thinking about the moral, economic and social benefits of maintaining remote work,” he said.

Thompson gave another example of his personal experience of the benefits of remote work: His chief of staff, who had previously worked at EY in New York, moved to a remote New South Wales cattle station to be near her family during the pandemic.

She now gets to live and work around her friends and family, spend money in her community, while simultaneously contributing to the growth of a global company like Employment Hero.

“If I only recruited people who lived within a 30-kilometre radius of Sydney, which is the sort of the accepted commutable distance, she wouldn’t even be on my radar – but she is like a superstar,” Thompson said.

“More people need to realise that they’re limiting their talent pool [by not allowing remote work].”

Despite the recent drop in the number of Australian remote workers, both Thompson and Woolrich expects the trend to tick back upwards over the coming years.

“As people get better at using technology that will help organisations become more comfortable with work from home and … as [managers] get better at trusting their teams to work in a remote environment, I think we’ll start to see people working from home more often,” Woolrich said.

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