In response to the COVID-19 pandemic, more companies today have shifted to remote work. While the transition wasn’t easy at first, the sudden shift proved to be a potential win-win for employers and workers: businesses can stay afloat amid a pandemic while employees can work in the comfort of their homes. More importantly, working from home becomes an effective financial planning strategy because of the potential savings in managing remote workers.
In this article, we’ll explore the reasons why companies should continue allowing employees to work from home even after the pandemic. We’ll also look at ways how remote working can save employers more money.
The most obvious cost-saving benefit of managing remote teams is reduced overhead. According to a study, a company can save up to $11,000 on average per employee by simply allowing them to work from home. This means companies don’t have to lease a commercial space to house their employees and supplies, which leads to bigger savings in a year.
Besides real estate costs, companies can cut down utility bills, such as water, electricity, gas, heating, and other essential services. They also avoid buying and updating new office furniture, equipment, electronic devices, and other supplies.
Plus, not having people working in the office means not paying for the maintenance, cleaning, services, and other support costs (e.g. snacks and catering). It also removes the pressure from employers to design an office catering to the unique preference of each employee.
Companies can redirect the extra money by spending it on other more critical areas. If your operations still require a skeletal workforce, you can keep the headcount to at least a few people or simply downsize the office to save more cash and resources.
Lower tax burden
Depending on your location and your government’s tax system, you can take advantage of tax incentives if your employees work from home, whether on a full-time or part-time basis.
Most governments encourage companies to implement flexible work arrangements. By allowing your teams to work remotely, you’re also actively contributing to reducing potential cases of COVID-19. Since your employees don’t have to leave their homes for work, your company becomes a part of the solution.
Tax incentives help reduce your income’s tax expenses at the end of the year, which often takes up the largest financial drain for any company.
Research reveals that employee productivity tends to increase dramatically when working from home. The most obvious reason is that employees save more time and money by avoiding long commutes to the office. In other words, being stuck in traffic is no longer a reason for being late!
While it requires a different level of trust to permit employees to work remotely, your business can actually benefit from increased productivity. A Stanford study reveals that 13% of remote employees are 13% more productive than their in-office counterparts. Plus, there are a host of employee monitoring platforms out there to manage the productivity of remote teams.
With the right productivity strategy, employees can enjoy a healthy work-life balance. Not all workers thrive in a traditional office environment, particularly millennials and Gen Zs. Some employees work better in a more relaxing environment without the typical distractions in the office, including the sound of coworkers chatting and nearby meetings. More importantly, they can devote the time used for commuting to tackle office-based tasks within a short period of time. Studies also show flexible work schedules lead to a healthier workforce. This means they’re less likely to get sick and be absent from work.
Remote workers have the freedom to find or create their ideal workspace, whether at home, coffee shop, or near the beach. After all, a suitable working environment is a key to productive and efficient work performance.
The idea of working from home has become more appealing among job seekers. In other words, candidates are more likely to prioritize companies that offer flexible work schedules and allow employees to work from home.
As the COVID-19 pandemic continues to plague the world, it’s understandable why people will still prefer to stay indoors to protect themselves and their families from the virus. As an employer, you have to recognize this need and include this in your recruitment strategy. So how does it affect a company’s savings? The recruitment advantage of remote work saves employers from the unexpected costs of hiring and high turnover.
The pandemic won’t be the only thing affecting the future of work. There will be more events and critical factors that can put businesses into challenging situations. As a company leader, you can emphasize more employee comfort by being strategic in implementing remote work strategies. It won’t only produce cost-saving returns for the company, but it will also affect other vital aspects such as retention, productivity, recruitment, and engagement.