Getting Rid of Remote Work Will Take More Than a Downturn

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During the nearly three years since pandemic precautions pushed remote work into the mainstream, companies have been negotiating a “new normal” in an environment that some say gives workers an upper hand: Hiring has been difficult, quitting has been popular, and employers had been in a good position to accommodate workers’ preferences.

The era of the slashed worker is over. The labor market is still strong. remains tightEven more forecasts that the United States will fall into a recessionEconomists believe that there will be more layoffs and fewer job opportunities in the next few months as companies review their operations. Amazon announced this week that it would reduce its workforce. 18,000 jobsSalesforce stated that it would employ 6 percent of its corporate workforce. lay off 10 percent of its employeesAbout 8,000 employees. Goldman Sachs will be preparing to lay off as many as 4,000 people.

Some top chief executives see an opportunity for their employees to return to work as the workplace changes. In May 2021, David Solomon, C.E.O. Tells the story of Goldman Sachs. workers to get ready to returnIn the coming month, we will encourage more in-person collaborations and shared culture. Elon Musk ended Twitter’s “work from anywhere policy” in his first email to employeesFollowing the acquisition of the company last year, Iger stated that he would require the employees to work at the office for 40 hours per week. Bob Iger did not give an office mandate to Disney when he returned as chief executive in November. However, he was reported to have told employees that “I worry long term about the negative impact on people who have decided not to spend as much time at the office.”

Is the remote work experiment triggered by the pandemic about to end? Economists studying the shift to more flexible workplaces say it is not likely despite the push by some of the world’s most high-profile C.E.O.s.

Hybrid work has become the norm

Last year, remote work stabilized at well above prepandemic levels, according to data compiled by a group of researchers at Stanford University, the University of Chicago and Instituto Tecnológico Autónomo de México.

Census data shows that 5 percent of the full-time, paid working days in America were completed remotely in 2019, with a total of 51%. The U.S. Survey of Working Arrangements and Attitudes (S.W.A.A.) was created by the research group.The U.S. Survey of Working Arrangements and Attitudes (S.W.A.A.) was launched by the research group. monthly pollIn May 2020, the percentage of workers jumped to 60 percent. This percentage has been hovering at 30 percent over the past one year.

“We are all back to prepandemic trends in online shopping, but permanently up on online work,” said Nick Bloom, an economics professor at Stanford and a co-author of the monthly survey.

According to the S.W.A.A.A., remote working is the most common. There are many options. other surveysThe new hybrid work model, where employees spend some time at the office while others work remotely, is called hybrid work. While individual preferences and feasibility of remote work can vary between companies and industries, there are common ideas on how much time each side should spend in the office.

According to the December S.W.A.A. According to the December S.W.A.A. survey, workers who can work remotely preferred working for around 2.8 days per week. Their employers expected them to be able to work from home for about 2.3 days each week. That’s not a big gap in expectations.

There are many obvious reasons why employees should be employed say they like working remotely: They want to avoid the time and costs of commuting; they focus better without office chatter; they feel it’s better for their well-being to be at home. McKinsey asked 12,000 job applicants last year their opinions about work. reasons for looking for a new job, “flexible working” came in just behind “greater pay or hours” and “better career opportunities.”

What often gets glossed over — and one reason some economists believe that a recession would have little impact on the shift in working arrangements — is that allowing employees to operate outside of the office can also benefit companies.

ZipRecruiter, an employment site, found that job seekers would agree to a median 14 percent salary cut in order for them to work remotely.

While the labor market is strong, it is slowing down. Companies are trying to find ways to make their jobs more lucrative without raising salaries. And many of them say they’re using remote work to do it.

“It’s not that there won’t be some loss of bargaining power by workers,” said Steven Davis, a professor at the University of Chicago and a co-author of the S.W.A.A. “It’s just that many employers have their own independent reasons to think that the shift, the partial shift, to remote work is beneficial for them as well.”

Managers are having difficulty reverseing the changes

To purchase a working paperPublication by the National Bureau of Economic Research. Mr. Bloom, Mr. Davis, and other respondents surveyed hundreds of senior business executives each month by the Federal Reserve Bank of Atlanta if they had expanded remote work as a way to “keep employees happy and to moderate wage-growth pressures.” Thirty-eight percent said they had done so in the past 12 months, including half of executives working in sectors such as finance, insurance, real estate and professional services. Forty-one% said they would do so within the next year.

The authors used executives’ estimates for how much they saved in pay by offering remote work to conclude that it would cut companies’ salary bill by 2 percent over two years.

“That’s not huge,” Mr. Davis said. “But what it suggests is that there are non-trivial benefits to many firms from remote work.”

Even a downturn can make remote work more difficult, and less sticky. Higher salaries could be a result of recruiting more people, even in places where the cost to live is lower than in the company’s headquarters. However, in certain industries like tech, there are some indications that salaries in different cities can be higher. converging).

Workers with an option to log in remotely may also take fewer sick days or decide to work remotely when they would previously have taken a day off to attend a friend’s wedding or extend a holiday.

Remote work can have its costs. Workers and managers often communicate with each other. disagreeWhich environment is the most productive? Working virtually can be difficult because of security concerns, software upgrades and compliance issues around hiring in different states or countries. However, Davis stated that in many cases companies have already paid these costs. “We had almost three years of experience doing this,” he said.

The most important reason companies might continue to use remote work during a recession is because it is hard to cancel. Musk clarified, just a few weeks after he mandated full-time office work that employees who wanted to work remotely were required to be an administrator. approval from a managerWilling to assume responsibility for quality work, even if it means being fired.

“Many, many companies in recent months have insisted that people come back to the office five days a week, only to reverse that mandate within about a week after hearing that they’d lose their best and brightest,” said Julia Pollak, the chief economist ZipRecruiter.

Remote work, Ms. Pollak added, “is not just used as a sort of perk in a tight labor market that’s going to go away in a slacker labor market.”

What do you think? Let us know your thoughts: dealbook@nytimes.com.