Does working from home work?

Better than you might think.  Here is a paper from a few years back, by Nicholas Bloom, James Liang, John Roberts, and Zhichun Jenny Ying:

A rising share of employees now regularly engage in working from home (WFH), but there are concerns this can lead to ‘‘shirking from home.’’ We report the results of a WFH experiment at Ctrip, a 16,000-employee, NASDAQ-listed Chinese travel agency. Call center employees who volunteered to WFH were randomly assigned either to work from home or in the office for nine months. Home working led to a 13% performance increase, of which 9% was from working more minutes per shift (fewer breaks and sick days) and 4% from more calls per minute (attributed to a quieter and more convenient working environment). Home workers also reported improved work satisfaction, and their attrition rate halved, but their promotion rate conditional on performance fell. Due to the success of the experiment, Ctrip rolled out the option to WFH to the whole firm and allowed the experimental employees to reselect between the home and office. Interestingly, over half of them switched, which led to the gains from WFH almost doubling to 22%. This highlights the benefits of learning and selection effects when adopting modern management practices like WFH.

Via Matt Notowidigdo.  Of course in that paper, the schools were not all closed…

Comments

Straussian reading - they are shirking work to hit the wet market

I think you need to read the whole excerpt before posting next time.

Some of the technologies explicitly include anti-shirking features. I'm pretty sure those are the ones with little shirking. Teleworking is not monolithic.

its not really shirking that is the problem.

humans are best when embedded within a peer network. Tyler blogs to be recognized by his peers. If no one read his blog he may still blog yet his enthusiasm and quality woudl suffer.

Whose productivity increases when teleworking. Well, obviously, this is not meant to be taken literally. It refers to any manufacturers of dairy products.

However, someone less interested in interpretation might note a straightforward correlation between a private workspace being quieter and more convenient and thus more productive compared to shared work space.

I think that productivity will grow, but only for people, whose work can be easily quantified. If someone's work is more analytical, it becomes harder to see, if they are working. This leads to them (for example, me) shirking more. The moments when you actually work though are still more active, because you can 100% focus on just working.

Well said.

My first thought was that call center employees are a very poor group from whom to generalize about less structured jobs.

Exactly! Telework is not suited to collaborative work. individual work may well be more productive in telework, but don't pretend there are no distractions -- there's always the proverbial dog that needs to be walked.

The lack of a commute means more time for both the employer and the employee.

Less commute = also more sleep.
Analytic work is more productive, because there are much fewer distractions.
Also lunch coffee and food are much easier to get at home and lead to less time loss.

Shirking is the usual complaint. Controls are unavoidable but they can go too far (checking movements of the mouse...). On the other hand, "being at the office" is not a proof of work, and in some cases working at home can be a better way to monitor the workers' productivity.

A concern which is seldom mentioned is that having to separate places in our lives - home and work -, and switching from one to the other, can provide psychological relief when there are tensions in one of the two places. If we did everything in the same place, we would lose this possibility.

Call centers seem to me to be similar to manufacturing jobs that can be both specialized for individual work and standardized. Canonical examples include sewing and seamstress work where for decades the employees were treated as contractors and sometimes even worked from home: dump a bunch of cloth materials at their home and pick up the sewn goods a few days later.

Some jobs are like that but most require workers to work more collaboratively. It like the difference between baseball, where most skills are highly individual (except for turning the double play, and pitchers and catchers often need to work together to get on the same wavelength) compared to basketball and soccer where team play and being able to anticipate what your teammate is going to do are of paramount importance.

The jobs that are more individualistic can be done at home (it's interesting though that given a choice, half of the workers who'd been at home opted to go back to the office whereas only a minority of the office-bound ones opted to switch to working from home). The ones that require more teamwork will suffer more productivity loss.

I'd have to guess that when Ctrip decided to give promotions to some of its call center workers, it chose the ones who'd been working in the office. If nothing else, those are the ones who the supervisors would know better.

Plenty of shirking from work goes on too. The quality of shirk is much better at home though. If you treat all utility equally it's a net gain. If you feel shirkers should be punished then not so good.

At work, shirkers will also involve other employees in the shirk

Maybe what works is a private workspace, rather than a cubicle or open office.

This is a good point. Personally I am fine with open plan, but there is definitely a subset of people for whom it is very bad as they want to chat a lot with their co-workers, which destroys other people's concentration as well as the people they are talking to.

For work that requires deep and/or sustained concentration, a private workplace from from interruptions is critical. I've seen studies that claim the time to regain focus is 10+ minutes, so if you get interrupted by a phone call or idle chat every 10 minutes ...

Similar to operating systems, you can end up spending all the cycles responding to interrupts, and little time on task.

https://www.fresnobee.com/latest-news/article241902706.html

An Alternative Care Facility set up at the Fresno Convention Center, Exhibit Hall, as a precaution during the COVID-19 pandemic was shown Thursday during a press conference, Thursday April 9, 2020.
----
A hundred new beds in this town of half a million. I was expecting 500 beds but we are still late to the game and tracking this like a flu pandemic.

I've been working remotely for years. Not all the time but most of the time. I found that I am more productive working remotely. Sure, the absence of the usual distractions contributes to productivity, but there's something else. But I'm not sure what. Working remotely means telephone conferences rather then meetings. For me, that's much better. What I've learned is that meetings have too many distractions for me, as compared to telephone conferences, including telephone conferences with multiple participants. Why is that? Meetings work for extroverts who are adept at multi-tasking. Telephone conferences work for introverts who aren't adept at multi-tasking. Does that mean I'm an introvert? Aren't introverts undervalued, indeed scorned, in our huckster culture? So, no, I won't admit I'm an introvert, but I I do know that I can focus like a laser and am very good at recognizing, analyzing, and resolving issues. Especially while working remotely.

Working from home during the pandemic is for losers: https://www.nytimes.com/2020/04/09/business/coronvirus-bank-of-america-workers.html

Interesting, I always thought BofA was ahead on WFH at least for their tech/ back office people. When I did some projects with them back in 2011 lots of the US based people were WFH. Made sense as their teams were all over the country and in India.

I've been struck by what is considered an essential service, exempting employees from the stay at home orders. Did you know that accounting is considered an essential service and, hence, employees of many accounting firms continue to work at the office? And it's a good thing: the IRS did not defer the deadline (April 30) for the first quarter's 941s and just this week the SBA once again revised the application for a PPP loan to make the first quarter's 941 a required document for the application. Banking is an essential service too, which is why Bank of America can demand that traders report to the office. The show must go on even if it means more than a few casualties.

I've been with my company now for 10 years and I've observed that folks that permanently work from home are about as productive those of us working from the office, but workers seem from home engage in more productivity signalling activities, most likely in an attempt to battle against the more limited promotion/pay increases that the study above observed in workers from home. I've notice those limited opportunities a bit too.

Childcare is indeed a factor. I know a couple who are both working from home now, with a 1 year old. Daycare is closed. Some of their work is asynchorous, but not all. The 30 second commute is great, probably saves 3 hours a day between them. They are getting by, but it's not really sustainable long term without outsourcing child care.

It’s only slightly easier with elementary students at home. While they don’t need constant attention, they do need assistance with their daily schoolwork.

One thing I like about WFH is the flexibility, I can take a proper break when I am tired, or even exercise, which is not possible at the office. My day is longer but I am not so tired.

Over the last month of working from home I find I move around a lot less. At the office I am occasionally away from my desk to speak with others and things lie the restroom and kitchenette are a greater distance than at home. As a result I have to force myself here to get up and move around (sitting on one place for hours is not good for you). Does this make me more productive? Well, maybe.

By the way, productivity should be measured by output, not process things like mouse moves and key clicks.

Maybe that's why I like working from the office better. I work at a college and can come and go as I please -- and there's a gym just a few hundred yards away, as well as an outdoor track, and a forest and pond and big huge lawns to walk around.

Sure people might get more “work” done from home, BUT 50% of office work is pointless and only in person collaboration is effective at at keeping the pointless task from growing to an even larger proportion.

Yeah, there are some jobs such as call center staff and garment work that are easily farmed out to individuals and their productivity can be easily measured -- or maybe even pay the workers with a piece rate system as with farm workers at the harvest.

There are a whole lot of other jobs though that aren't easily measured by piecework productivity, and where collaboration rather than individual work pace is what matters. Sometimes that collaboration can be done remotely and asynchronously, but sometimes the lack of face-to-face reduces communications and idea sharing, and hence reduces new ideas.

I've always been an office guy, and looked down on people who worked from home as slackers. A month ago, I was dragged kicking and screaming from the office, and forced to work at home on a laptop hooked up to the organization's system.

Now I work at a desk set up in space over my garage and -- holy cow. I am getting so much work done, I feel like I'm 24 and still "hungry". Mind you, I get up at the same time I always did, take a shower, shave, dress in clean clothes before going out to the garage at 9 on the dot. I even kiss the wife goodbye.

Once up the stairs, I crank up some Haydn on the CD, sit down, and am awesomely productive for the next 7 hours. Lunch? Forget about it. I have a diet Coke, scan Marginal Revolution, and get back to work. Meetings are done via Microsoft Team, and I take them at my desk, not lying on a sofa. They're fun.

Now, here's the best part, and I mean this perfectly seriously. Not being young, I have to make frequent visits to the rest room. At the office, that means I have to get up from my prestigious corner cube, and make my way halfway across the building to the rest room. This takes about ten minutes, since I have say "Hi" to people, answer someone's random question, and wash the hell out of my hands into set a good example for the others.

In my garage office, there's a little half bath, so when I have to go, I simply leap out of the chair, get the business done, and leap back into the chair. No break in concentration. Whole thing takes about 40 seconds.

Massive amounts of work are getting done. I have no urge to clock watch, and the days fly by.

Now, if I were 25 and still hungry, it would be killing my career to work from home, since you need to build and maintain networks at that age. But now, closing in on retirement, this is great.

I have absolutely changed my mind about working at home.

"Now, if I were 25 and still hungry, it would be killing my career to work from home, since you need to build and maintain networks at that age. But now, closing in on retirement, this is great."

Yes, the answer to the work from home question depends not just on the job and the firm, but also the worker's situation including where they are in their career.

I've found that the more experience that I've gained, the more that I should be (and should have been) constantly reaching out to people in other offices, and not always with some specific idea but just to inform them of this or that or hear what's going on in their office. It's partly a matter of rising in the hierarchy, but mainly something that was true all along: a matter of knowing enough of the big picture to be able to set priorities and make trade-off decisions, as well as create more collaborations between offices. An example is the trend toward de-siloing.

But that's my job, it might not be true of others' jobs.

You've got to show your face. In the flesh. It imprints at some level, and works to your benefit, and the team's benefit. After all, what is a team, if not a bunch of interconnected faces?

If someone invents some sort of face related technology for use online they'll make a billion bucks. Maybe even $64.6 billion.

It can work well - depending on the type of work and the person. I spent 25 years working from home on various contracts - without the internet and computers I would not have been able to do that. BUT I also had to be very disciplined - I would start work at 8 a.m., break for coffee at 10 and lunch at noon and then back at my desk by 12:30. But I would be done by 2:30/3 p.m. most days because I was very productive and focused. To do the type of work I was doing (conducting evaluation research) to make money you had to be in, get the data, write the report and out - if you spent too long on fiddling with the report and over analyzing the data, you didn't make money.

I also had the experience at working for a government agency for 16 months - I could have done twice the amount of work in half the time. The amount of wasted time was sickening. Waiting for meetings to start, waiting for people to respond back before you could more forward. Never again.

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