Remote work vs in-person: What does the data say?

When the worst effects of COVID had appeared to pass, many companies started implementing return-to-office mandates for their knowledge-workers, which have been controversial at best. The decision to do this was based on gut reactions from managers who, having no actual data, made the best guesses they could with what they knew.

At the same time, arguments for and against being in the office have continued and they’ve also been largely based on gut reactions and anecdotal stories.

Today, however, data is starting to appear. Three recent reports from Atlassian¹, the Federal Reserve of San Francisco², and Pittsburgh University³ are giving us some data, with which we can challenge our assumptions.

“The shift to remote and hybrid work has reshaped society in important ways, and these effects are likely to continue to evolve. For example, with less time spent commuting, some people have moved out of cities, and the lines between work and home life have blurred. Despite these noteworthy effects, in this Letter we find little evidence in industry data that the shift to remote and hybrid work has either substantially held back or boosted the rate of productivity growth.”
— Federal Reserve of San Francisco²

“Overall, our study adds to the ongoing debate over [Return-to-Office] mandates and demonstrates that mandating employees to return to the office after the COVID pandemic does not result in a significant improvement in firm performance. Instead, such mandates hurt employee satisfaction.”
— Pittsburgh University report³

If the goal of bringing people back to the office several days a week was intended to improve productivity, I think the data is fairly clear that this isn’t happening. That productivity is the same whether people are in the office or working remotely.

So what other factors might be important?

Atlassian reports¹ that they have a much easier time hiring top talent now that they offer the flexibility of being fully remote. They have twice as many candidates for any role and their candidate acceptance rate has increased by 20%. They’ve also jumped up 40 spots on Fortune’s “100 Best Companies to Work For” in one year for “leading the charge when it comes to employee flexibility in the new era of work”.

They also call out the fact that they needed to change some of the ways they worked to make remote be as effective as it is. In particular, they talk about timezone differences and how there is a minimum amount of overlap time that is required to make collaboration work well.

“Our internal data show that collaborators need about 4 overlapping work hours per day to be effective (new graduates need more and senior leaders need fewer).”
— Lessons Learned: 1,000 Days of Distributed at Atlassian¹

Then they come to the point around in-person time. They acknowledge that it is important for people to come together periodically, however, their data shows that a few times a year is more than adequate.

“Team gatherings lead to an average 27% increase in feelings of connection, and this boost lasts 4-5 months. In contrast, our research shows that sporadic office attendance has no impact on team connection. We also see that new hires and new graduates especially benefit from meeting in person. These groups experience bigger boosts in team connection following in-person gatherings.”
— Lessons Learned: 1,000 Days of Distributed at Atlassian¹

What can we take from this? If the desired outcome is productivity, the data is clear that while bringing people together face-to-face is indeed important, it’s not necessary to do that more than a few times a year. In fact doing it too often (ie weekly) can be detrimental in terms of morale.

In the absence of data, we made decisions about bringing people back into the office that were based on gut reactions. Now we’re beginning to collect actual data and are discovering that some of our assumptions were wrong. Perhaps it’s time to re-evaulate those decisions.

Lessons Learned: 1,000 Days of Distributed at Atlassian ↩ ↩² ↩³ ↩⁴
Federal Reserve of San Francisco economic paper: Does Working from Home Boost Productivity Growth? ↩ ↩²
University of Pittsburgh sampled companies from the S&P Index on Return to Office Mandates Citation: Ding, Yuye and Ma, Mark (Shuai), Return-to-Office Mandates (December 25, 2023). Available at SSRN: https://ssrn.com/abstract=4675401 or http://dx.doi.org/10.2139/ssrn.4675401 ↩ ↩²