The novel coronavirus has been a boon for the growing work-from-home trend, making millions of people into remote workers almost overnight as companies seek to continue operations amid the global pandemic. But while thats saving certain industries from certain doom, it may not be a positive move for workers and productivity.
I recently spoke on Zoom, of course with Nicholas Bloom, an economics professor at Stanford University, who has written extensively about working from home and who has been pretty bullish about its benefits. Famously, he conducted a two-year study of a major Chineses travel company that found working from home made employees more productive and less likely to quit. But now, with the coronavirus pandemic turning many more people into de facto remote workers, Bloom is less optimistic about the new inundation of working from home.
This interview has been lightly edited for clarity and brevity.
Tell me about your work-from-home study with Chinese travel company Ctrip.
So what we did in China is we took 1,000 people, and we asked them who wanted to work from home, and only 500 of them volunteered only half of the people up-front wanted to work from home. And after the end of the experiment, of the 500 that worked from home, quite a few changed their minds, and I think about 30 opted to come back in. Working from home actually worked well for the employees in China who chose to work from home: They were 13 percent more productive, and the quit rates halved.
So with coronavirus and lots of new people working from home, shouldnt that be a good thing?
Theres a couple of stings in the tail I think really dont work well for Covid-19. One is, all of these people in the China study volunteered to work from home, and they were doing an activity that was not team-based. They were booking telephone calls and speaking to people on the phone and doing data entry, so they dont need to work with other people. Secondly, they were working from home four days a week, but critically, on the fifth day they were coming into the office, and that was good to keep them tethered to the workplace.
So with Covid-19 you have a couple of things: One is theres no choice. Everyones being forced to work from home, whereas in China, only half of people even wanted to do it. And the half that didnt said it was very lonely and isolating. And then, finally, just the intensity. So I think coming in at least one day a week but typically two or three gets you connectivity to the workplace, helps with creativity. Most creativity is done in face-to-face environments. It encourages you to be ambitious and motivated. Full-time at home can be pretty miserable. Most people dont enjoy it, you know, week in week out.
Its a bit like exercise. Exercise goes from everything from a half an hour a week in the gym to full-on marathon training. Were, like, throwing the entire US into the exercise equivalent of full-on marathon training by sending people to work at home five days a week, all the time. And I suspect for most people, it isnt going to work well.
So what makes this different for productivity in your previous study was that people chose to work from home, and they still came into work sometimes. Anything else?
People were trained. They were set up, whereas now weve just been thrown in. Its like you join the army, then on day three youre told youre going to be parachute-jumping at lunchtime, and youre given a parachute and thrown out of the plane. No training, no preparation.
2020 is going to be the year of lost innovation
I mean, I understand the health reasons for doing it. Im not saying I would have done anything differently. I just am very pessimistic. I think its going to generate a massive long run of personal health and also economic costs.
Whats the economic cost?
Productivity now will be down dramatically. As a personal example, I have four kids and theyre at home, and Im struggling to get anything done. And its not just that, its also that motivation and creativity come from being around other people. So I find it hard to be creative and, honestly, find it hard to self-motivate myself if Im stuck in, you know, one room at home day in and day out.
So I think even if this all returns to normal, theres going to be a long-run cost. 2020 is going to be the year of lost innovation. If you look 10 years from now, theres going to be a hole in new patents and new products and new ideas and great inventions that just didnt happen in 2020, 2021. Think of scientists or engineers. How can they work properly at home? Theyre being sent home, but I suspect theyre really not being very constructive.
And the personal cost?
I worry about an explosion of mental health issues. Because youre isolating people at home all the time and removing them from social interactions, and thats going to lead to depression. Depression itself generates its not just mental health but physical health tends to do very badly.
A good place to look at this is studies of people that retire. Health typically goes down quite precipitously after they retire. And this is a very similar phenomenon. And its not really as stark because, in retirement, you go out and see your friends and play golf. Now weve got a much more extreme situation. I think were going to see an explosion of health issues from home-based working both mental health but also physical health.
Not everyone can work from home. Are we going to see an economic divide between those who can and cannot work from home?
There is a big divide. Typically, lower-paid jobs tend to be more manual and interpersonal and so theyre not going to work well. So I think youre going to find that higher-paid people can work from home. Lower-paid people are just going to lose income. So I think its going to increase inequality. And if you just look at the statistics, its hard actually to find many high-paid jobs that require permanent interaction. So doctors, dentists, pilots there arent many others actually. Most high-paid jobs you can do remotely for a while.
What other unintended consequences might we expect?
I think theres going to be potentially a gender divide. The rough hypothesis is if you just look at the jobs that women have tended to dominate, they tend to have a high degree of interpersonal relations, so its much more about face-to-face. So they tend to be more caring jobs or service jobs or management jobs or doctors. Theyre jobs about people dealing with other people. Whereas men traditionally have been in jobs that are more physically manual. They basically almost seem to be the inverse of the jobs women have been concentrated in.
The types of things that dont work well when youre working from home are, of course, going to be central to the jobs that are very heavy on interpersonal interactions. Though I guess health care is going to do well in the short run.
Have any advice for employers to make this swift transition to working from home better for employees?
The key advice is to recreate social contact using video conferencing, two ways. First, group interactions. For example, the whole group can meet for a 30-minute video chat at 11:00 every day to catch-up on their personal situation, chat about the news or life in general no work talk. Second, individual interactions. For example, every morning and every afternoon spend, 10 minutes video-talking individually to each of your employees. This is time-consuming but critical for keeping employees happy and productive through the next few months. In the longer run, it will build valuable loyalty by sticking with your employees through the good times and the bad times.
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