The “second wave” of the work from home shift is more complex, much like “living with COVID” is messier than pursuing elimination of the virus. Once lockdowns lift, the second wave of experimentation involves asking: what does a “hybrid” model actually mean in practice?
The commission says the answer will be decided by employers and staff negotiating, trialling and adjusting. Like all negotiations, there’s common ground between workers and employers, as both sides have an interest in changes that can improve productivity.
But the working from home phenomenon is different from other innovations that have lifted productivity, such as the introduction of electricity or computers, which initially benefited firms. In contrast, the main benefit of working from home is that it allows people to avoid commuting.
And that leads us to a key finding in the commission’s research: employees and employers want different things from the working from home revolution.
For staff, the commission cites survey data showing the biggest benefit is the time saved commuting – which averaged 67 minutes a day for full-time workers in the main Australian cities.
It says about three-quarters of people surveyed want to work at home some of the time, though most workers also want some time in the office. There are downsides from less physical activity at home, and isolation, but the survey suggests most of us do not want to head into the office five days a week.
Employers, perhaps not surprisingly, are more concerned about productivity and costs. The commission cites employer concerns that working from home can stifle creativity, reduce “serendipitous exchanges,” weaken a firm’s culture, and make it harder to manage staff. On the positive side, companies can save on rent by using less office space, and may benefit if their staff are more productive at home because they can better manage their time.
These different priorities of staff and employers will set the scene for the second wave of experimentation with working from home.
The experiments could include having staff spending two or three days in the office and the rest at home, and companies are likely to tweak their policies as they learn from their experiences and those of their rivals.
Over the longer term, the commission says workers most keen on working from home will have the incentive to find a job that can combine working from home with good pay, and may switch jobs accordingly. Others may bargain with their existing employer to keep working from home by offering to accept lower wages, though this probably won’t be widespread.
Ultimately, the commission says working from home arrangements that succeed for both workers and bosses should thrive, while others that don’t work will die out. Employers and workers will settle on “mutually agreeable outcomes,” and both sides will need to work on issues such as drawing a boundary between work and home life.
As for the wider economic impact of all this, there’s cause for optimism. The commission says the effect of working from home on an individual’s productivity is “ambiguous.” But for the economy as a whole, it thinks the working from home shift won’t harm productivity and could improve it, as we all get better at making working from home easier and more effective.
And putting aside these potential impacts on the economy, the fact so many people want to do some of their job at home suggests this is a change that could improve the wellbeing of millions of Australians. As the commission says: “The wellbeing benefit of working from home provides a clear and strong incentive to make it work.”
Ross Gittins is on leave.