Is the sky falling? The good, the bad, and the unknown about working from home

Recently, discussion has centred on concerns about potential job losses for South Australians. So, what do we know from the research evidence? Is there any evidence supporting the claim that WFH will move local jobs offshore?

Adelaide Business School experts in Management Dr Valerie Caines, and Associate Professor Chia-Yen (Chad) Chiu have extensive expertise in this area. 

"Research has explored this issue (also known as telecommuting or remote work) for a long time. We can look back on 15 years of research conclusions to assess the impacts of WFH on organisations." – Associate Professor in Leadership, Dr Chad Chiu.

WFH has been found to have a positive association with individuals' work outcomes, including improved productivity, higher job satisfaction, and lower turnover intentions. However, researchers acknowledge that these observed benefits might be influenced by reverse causality. It is possible that top performers or those who are more committed to their jobs are more likely to be granted the opportunity to WFH. 

The impact of WFH on work-family conflict is more complex. 

"Individuals who extensively telecommute tend to experience less work-to-family conflict (when work interferes with family), but they may face more family-to-work conflict (when family interferes with work). Moreover, various contextual factors such as job design and household size can modify the effects of telecommuting. This suggests that the benefits of WFH may not be a one-size-fits-all solution and could depend upon individual profiles." – Dr Val Caines, Senior Lecturer in Human Resource Management

Recent evidence indicates that organisations can reap the benefits of remote working when managers establish clear expectations for virtual communications. This includes guidelines on when, how, and how frequently employees should communicate remotely. Additionally, organisations need to ensure that there are no issues with the quality of remote communication.

These studies suggest that WFH can enhance immediate work outputs for employees. 

On the flip-side, organisations must also consider certain hidden costs. These costs arise from the increased demands on training and supporting managers, maintaining remote communication quality, and revaluating job design for both managers and employees.

"It is important to recognise that not everyone can fully enjoy the benefits of WFH, especially individuals who struggle to effectively separate their family and work lives." – Dr Chad Chiu

During COVID and post-COVID WFH

When interpreting the level of productivity of workers who WFH context is important. During the COVID-19 community lockdowns WFH employees were not volunteers, and the move to work from home happened suddenly with little time for managers to develop effective ways of working. There were high levels of work-family and family-to-work conflict as people tried to navigate how WFH was going to work for them and their household. It is not surprising that during this time the data on worker productivity was mixed. 

Jump forward to 2023, and WFH can be supported by policies and training, employees can have a say in whether they want to WFH none, some or all the time, and productivity metrics can be established and measured. 

"We need to get more data to fully understand the productivity impact." – Dr Val Caines

Even before the COVID pandemic, many organisations outsourced certain jobs offshore to improve efficiencies and reduce costs. This practice is not solely attributed to WFH. 

"It is crucial to recognise that certain jobs cannot be sent offshore due to legal, privacy, or registration reasons. Additionally, companies understand customers and clients prefer dealing with local businesses and highly value Australian jobs. In fact, there is some evidence that companies are re-shoring." – Dr Val Caines

While offshoring provides a labour cost savings there is evidence that predicted financial gains from offshoring do not always materialise; there are risks to the company image, and intellectual property and cultural differences that must be overcome. 

Will WFH cost you your job?

The research so far does not indicate that increased levels of WFH will result in job loss. Current debate often revolves around the assumption that remote workers are less productive and that WFH will be a significant driver of unemployment, or that jobs will be sent overseas. The existing evidence suggests the opposite - WFH tends to make employees more productive and satisfied with their jobs, which enhances their competitiveness in the job market and makes them valuable assets for organisations. 

"The real challenge lies in how organisations can improve their leadership development and HR policies to optimise the benefits while mitigating potential drawbacks of WFH." – Dr Chad Chiu