For some, having to work from home during the COVID-19 pandemic has been stressful. Parents were balancing work while caring for their children. Some struggled to set up home offices and get used to new tools like video conferencing. Social isolation deepened as I continued to work alone at home. The line between work and life has become blurred.
For some, working from home has been a boon: comfort, convenience, flexibility, and the freedom from commuting, rush-hour traffic, and the distractions of an office environment. As the serious aspects of the pandemic faded, those who initially struggled began to settle into the work-from-home (WFH) atmosphere and appreciated their newfound flexibility.
Bosses then began calling employees back to the office. Many argued that return-to-office (RTO) policies and mandates were better for their companies. Many suggest that employees are more productive in the office and that face-to-face interactions encourage collaboration. However, there is little data to support that argument. Pandemic-era productivity is difficult to interpret, given that the crisis has disrupted every aspect of life.Pre-pandemic research generally recommended remote work Improve However, this often includes workers who volunteered to work from home, which could bias the findings.
To get a clearer look at the impact of RTO policies post-pandemic, two business researchers from the University of Pittsburgh looked at a sample of companies on the S&P 500 list. Of these, 137 companies had his RTO obligations and 320 companies clearly did not have his RTO obligations between June 2019 and January 2019. 2023. Researchers collected publicly available data about each company, including financial data and employee reviews. Next, we consider factors related to whether a company implements an RTO policy (e.g., company size, financial constraints, CEO characteristics) and the impact of RTO obligations (e.g., employee satisfaction and company financial indicators). did.
When analyzed overall, Released as a preprintfound that RTO obligations do not improve a company’s financial metrics but reduce employee satisfaction.
Digging deeper, the data showed that RTO obligations are associated with companies that have male CEOs with more power within the company. Power here is measured as the CEO’s total compensation divided by the average total compensation paid to his four highest-paid executives in the company.
Prior to their analysis, the researchers hypothesized that RTO obligations would be used to blame employees for a company’s poor performance. However, companies owned by institutional investors, such as hedge funds and endowments, are less likely to engage in such a ‘blame game’ and therefore are less likely to introduce RTO obligations. The data supported those hypotheses. Companies whose stock prices were depressed before employees returned to the office were more likely to enforce RTO obligations. However, institutional ownership reduced the likelihood of RTO obligations.
Although CEOs often justify RTO obligations by claiming that they improve company performance, the results of our determinant analysis suggest that managers use RTO obligations to reaffirm control over employees and increase corporate performance. “This is consistent with blaming employees as scapegoats for poor performance,” the researchers concluded.
Not surprisingly, researchers also found that RTO obligations were associated with lower employee satisfaction. Specifically, after mandatory RTOs, employee ratings of overall job satisfaction, work-life balance, senior management, and company culture declined significantly. However, the ratings of factors unrelated to the RTO have not changed, indicating that the RTO mandate is causing dissatisfaction.
This study has limitations, including the short time frame for examining the long-term outcomes of RTO policies and the time frame that overlaps with labor shortages. Workers may react differently if the labor market is tight. Still, this study adds some data to the ongoing debates and feuds surrounding RTO policy.
