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70% of Office Workers predicted to work from home, studies show


Recently, there have been reports that the majority of office workers are predicted to not return to physical offices. These predictions come from the majority of office workers themselves.


Furthermore, 79% of senior managers have stated they believe that office spaces will never return to normal pre-pandemic levels.


This changing nature of office work will have varying levels of impact on the economy and labour market.


The recent trend of working from home has a wide range of effects on the office staff themselves. For some, working from home is not preferable. Reduced social interaction and boredom could consequently result in reduced productivity, not to mention possible negative impacts on mental health.


In terms of the impacts on output created by office workers, half of 530 senior leaders said workers staying at home would adversely affect both creativity and collaboration (surveyed by polling organisation YouGov).


If their concerns on productivity are true, which is hard to measure or determine, then the UK economy and industries could become less internationally competitive on the global market. With the quality or quantity of UK goods and services falling, countries with fewer COVID-19 cases may be at an advantage when it comes to selling goods or services.


On the other hand, office-based work results in lower costs for firms. With fewer employers working in the office, smaller floor space is required. This allows firms to find smaller officers to rent, thus reducing one of the fixed costs many businesses have to pay.


Rent is an example of a fixed cost as it is not variable with output. Firms with large fixed costs have struggled over lockdown, as despite not being able to produce goods or services, they will still have costs. This resulted in firms not just gaining no profit, but losing money throughout the lockdowns.


Another benefit of the decline in working in offices is that for business, the labour pool from which they can employ has rapidly expanded. Previously, employers would be limited to workers that lived from a commutable distance. However, now with increased home working, employers can live all over the country, or potentially even overseas.


With time zone differences being the only prohibiting factor rather than miles, businesses can now seek the best person for the job. This may boost productivity and innovation within the workplace, potentially meaning that a fall in international competitiveness will not be seen after all.


Furthermore, the ability to work for almost any business from anywhere in the country may result in growth in rural areas. Now that people can support themselves financially in areas where there is little or no local industry (which would previously have been an issue and dissuaded those looking to move), many more may move to such areas. This will cause a boom in the local industry and a positive multiplier effect.


Therefore, an increase in home working could have a variety of impacts, both positive and negative) on the individual worker, firms or economy.

 

Written by Charlotte Hurst

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