Remote Work is Becoming the New Normal. It Comes With Tradeoffs.

Remote Work is Becoming the New Normal. It Comes With Tradeoffs.
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In the two decades prior to COVID-19, remote work grew steadily but remained a small portion of the U.S. workforce. Then came March 2020, when stay-at-home orders turned the world upside down, transforming kitchens, bedrooms and home offices of tens of millions of Americans into corporate real estate.

What many thought might be only a short-term adjustment looks increasingly permanent. As of September, the percentage of workers who were remote full-time or part-time stood at 33% and 25%, respectively. By the end of 2021, Global Workplace Analytics predicts that 25 to 30 percent of the US workforce will work remotely permanently at least multiple times a week.

This is a seismic shift in business and work culture that had been stalled for years by executive-level fears of lost employee productivity. Then COVID-19 forced business leaders to face their fears. Now, headline after headline highlights companies like Google, Microsoft, Amazon, Slack, Twitter, Uber, and American Express all announcing plans to extend and reform their remote policies to accommodate extended or indefinite remote work. A majority of employees likewise now hope to continue to have more flexible remote work options in the future, even after the pandemic subsides.

Before we celebrate the arrival of employment Xanadu, it’s important to note there are a host of positive and negative tradeoffs companies — and workers — have to consider. In our recent report, “The tradeoffs of remote work: Building a more resilient workplace for the post-COVID-19 world”, we summarize the state of remote work research and where additional investigation is needed to help the employers and workers adjust to a new way of doing business.

Our research found that for employers, remote work has increased productivity, slashed operational expenses, and given employers new tools for talent recruitment and retention. Less commuting has reduced negative environmental impacts and shown companies how to bolster operational resiliency in the face of natural or man-made disasters.  

At the same time, employers are struggling with factors associated with business management. First and foremost, building a strong company culture in remote work settings can be challenging, inhibiting not only employees from having better employment experiences, but also reducing ad hoc communication and collaboration that often stems from being in the office together. Employers are also finding it harder to manage and measure the performance of remote workers and mitigate against cybersecurity risks.

For workers, remote work has been a boon for professional autonomy, permitting greater flexibility to set the working hours and physical conditions that are most comfortable for them. This can lead to greater job and life satisfaction and improve their physical well-being. Less commuting means more time for hobbies and family, as well as lower work-related expenses. Some have even used the new flexibility to move to areas with more affordable housing.

In terms of negative trade-offs, workers are finding that remote employment also tends to erode the boundary between work and life with workplace communication tools invading our personal spaces at home. Given the central role work plays in most peoples’ social lives, the rise of remote work can lead to a loss of social contact, resulting in loneliness. And, as most are familiar with by now, there’s the ubiquitous phenomenon of “Zoom fatigue.”

There are also equity challenges for companies to consider. Broadband access is a challenge for millions of Americans and, on top of that, many also lack access to personal computers at home. Some employees also have insufficient space in their homes to do their work comfortably, which can significantly inhibit their performance.

As we note in our report, the findings from our research have some limitations. For example, many of these studies we found were conducted at a specific company or organization and are not necessarily representative of all companies or industries.  We also know very little about the long-term impact remote work will have on employees themselves. Much more research is needed looking at both the quantitative and qualitative effects of remote work.

COVID-19 has changed life in the U.S. dramatically and accelerated trends toward remote work that otherwise would have required decades to achieve. It will take many years to sort out and understand the importance of those changes, and to learn how policy and practice need to change to accommodate the “new normal” when it comes to work and career. As the cracks in remote work practices emerge, attention will be required to prevent businesses and workers from falling through.

Brent Orrell is a resident fellow at the American Enterprise Institute. Matthew Leger is a research analyst at the American Enterprise Institute.

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