Working remotely cuts costs but there are losers

As I write this column in early November, Covid-19 case numbers are heading in the right direction – at least in Australia. There are positive signs of borders re-opening across all states and territories but mass international travel remains a pipedream.

How Australia recovers economically from this pandemic is something that I cannot foretell. But there’s plenty of research filtering through the Money email inbox that suggests in the longer term we’ll be overall financially better off for living through this experience.

From a study of 1500 workers in August and September this year, the NSW Innovation and Productivity Council suggests that working remotely has increased productivity by an average of 13%.

When NSW workers don’t commute, they have an extra one hour and 17 minutes every day (on average) and a portion of that time is used for working. According to the council’s report, if you work remotely two days a week, it’s equivalent to 3.3 weeks of leave a year and saves $860 a year in travel costs.

In July, personal finance comparison website Mozo said that from its study of more than 1000 Australians, working from home did present cost increases such as higher energy and broadband bills. However, on the whole, Aussies were saving money. The report says 64% of remote workers were saving as they didn’t spend on commuting, eating out or buying coffee.

These studies also come to the conclusion that more employees will have more flexibility to work remotely, as least some of the time.

Once the pandemic is declared over, 78% of Australians are set to ask their employer for more flexibility to work from home, says Mozo. It estimates that seven million Aussies will request to work full time from home once the pandemic ends.

This is an interesting development and if it plays out in full there are economic risks, too. The NSW Innovation and Productivity Council report notes that remote workers will miss opportunities to collaborate as well as incidental interactions with peers. However, people working in retail, hospitality and health may not be able to share the benefits of remote working as many tasks must be done on site.

Comparison website Finder says while the transition to remote work arrangements was a hurdle for many workplaces during the pandemic, employees can look for some benefits now and into the future.

“If you aren’t able to negotiate a salary increase this year, additional perks like flexible working arrangements or increased annual leave are reasonable alternatives to fall back on,” says Finder insurance specialist Taylor Blackburn.