Announcement

ADP Research Institute (ADPRI) and the Stanford Digital Economy Lab (the “Lab”) announced they will retool the ADP National Employment Report (NER) methodology to provide a more robust, high-frequency view of the labor market and trajectory of economic growth. In preparation for the changeover to the new report and methodology, ADPRI will pause issuing the current report and has targeted August 31, 2022, to reintroduce the ADP National Employment Report in collaboration with the Stanford Digital Economy Lab (the “Lab”). We look forward to providing an even more comprehensive labor market analysis and will be in touch with additional details closer to the re-launch, later this summer.  For more information on this announcement, please visit here.

MainStreet Macro: Working from Home- The Good, the Bad and the Virtual

August 16, 2021 | read time icon 5 min

Nela Richardson, Ph.D.
Share this

This week we’re talking about a subject that a lot of us have gained experience with over the past year – working from home.  

During the early days of the coronavirus outbreak, as much as a third of the U.S. workforce did their jobs from home specifically because of the pandemic, according to the Bureau of Labor Statistics. The number shrank to just 13% in July as more adults were vaccinated. 

Most jobs can’t be done remotely. But at companies where work can be done from home — or the coffee shop, or the pool — employers are facing an inflection point. 

Companies need to decide if they’ll require employees to come back to the workplace or continue to allow remote work. The choice has been complicated in recent weeks by the highly contagious Delta variant, which has some companies delaying their back-to-office plans.  

But longer term, the decision will depend on the answer to one simple question: How does where you work affect how you work? 

To better understand the opportunities and challenges of returning to on-site work from the lens of employees, ADP Research Institute conducted a survey of 9,000 people who worked on teams , were U.S. based, and did not change employers during the pandemic. 

Here are four key findings from the survey, “On-site, Remote or Hybrid: Employee Sentiment on the Workplace”. 

Finding 1: On-site work might mean higher-quality communication. 

It’s probably not surprising that more on-site workers (77%) than remote workers (60%) say they engage in spontaneous conversations with their teammates.  

That might be why more on-site workers (70%) say they have a strong feeling of connection with their colleagues, compared to remote workers (64%).  

What might be more surprising is that the stronger connection isn’t based on more frequent meetings. In fact, on-site workers say they spend less time on work-related communication and meetings. On average, workers physically on the job say meetings account for 15% of a typical workday, compared to 25% of the day reported by remote workers.  

Not only are those on-site spending less time at meetings, they’re also working less – on average, an hour less – than remote workers.  

Finding 2: On-site employees feel better prepared for job success. 

In-person face time is a workplace staple. When it comes to hiring and promotions, 57% of non-management employees think their bosses prefer workers who show up in person.   

And they’re right. The perception is supported by managers themselves. Fifty-nine percent say they do give preference to on-site employees when making decisions on hiring and promotions.  

On the flip side, there’s a disconnect between the perceptions of managers and employees in the very sectors that seem more suited for remote work, such as information technology and finance, including real estate. Employees in those sectors are more likely to think that location doesn’t matter, while managers in those sectors firmly believe it does.  

Information technology had the widest disconnect between employees and managers. Half of  managers say they want their team in the office, compared to only 35% of workers who thought it was important for their career progression to show up in person.  

Your manager’s preferences and your promotion potential would be a great agenda item at the next staff meeting. 

Finding 3: A return to the office might change team dynamics. 

When it comes to on-site work, not everything is rosy.  

Yes, there are clear advantages to working from home. Remote workers reported a team spirit that transcended physical separation – or perhaps existed to compensate for it. They were more likely to say their team is collaborative (62%, compared to 47% among on-site workers) and supportive (66% versus 59%). They were less likely to describe it as gossipy (9% versus 20%) and cliquish (7% versus 10%). 

But our survey found something counterintuitive, too. On-site workers were less likely than remote workers to say that innovation is encouraged. The finding seems to upend the traditional perception that innovation is linked to face-to-face interaction.  

During the pandemic, leading CEOs expressed concern about the impact of remote work on innovation. Our findings suggest that it doesn’t hamper innovation, and might even improve it.  

Finding 4: Hybrid work is the best of both worlds. 

The most-connected workers are those that enjoy both remote and on-site work. Seventy-nine percent of hybrid workers say they have a strong connection with teammates, compared to 70% of on-site workers.  

Those relationships are strongest among parents of younger children, 83% of whom said they have a strong connection with their teammates. 

Maybe companies and their employees really can have their cake and eat it, too.  

My Take 

More than a year into our grand experiment with remote work, we still have more questions than answers.  

How do we foster enough high quality, in-person interaction among employees to make their time in the office worth the commute (and uncomfortable clothes)?  

Companies historically have struggled with gender, ethnic, and racial equity. How do they now create a promotion structure that also is location-blind? 

How do we preserve teamwork and corporate culture when people are scattered?  

In a perfect world, employee preferences and business needs would mesh neatly. But one thing we have learned over the past 17 months is that there’s no one-size-fits-all workplace. 

Maybe that’s why so many hybrid workers reported being connected to their jobs. The key to the future workplace might be flexibility.