Evaluating the risks and opportunities of working from home

March 4, 2021

Alison Pennington, Senior Economist, Centre for Future Work, Australia

Lockdowns imposed in response to the coronavirus pandemic in Victoria meant that entire cohorts of workers who previously interacted in the flows of the daily commute – the morning coffee, dropping kids off at school – were suddenly pulled apart and isolated from each other, connected only by the occasional masked “hello” on the street. Businesses and workers moved fast in March 2020 to implement new remote-working models. Almost overnight, hundreds of thousands of private homes were transformed into workplaces.

As Melbourne emerged from these lockdowns, we acknowledged our public health success had not come without immense sacrifice. Healthcare and other frontline and essential workers exposed themselves to the virus to help keep us safe. Hundreds of thousands of low-paid workers in customer-facing sectors were pulled off the job to stop the spread.

But COVID-era work sacrifices are not simply dependent on what industry you work in. It also matters on what work conditions people had coming into the pandemic, with those in insecure jobs the first to be discarded in the crisis. The pandemic has shone a light on the growing scourge of insecure work. Around half of all employment in Australia has one or more dimensions of precarity including casual, temporary, part-time insufficient-hours work, and self-employment. Precarious work contributed to the community spread of the virus, such as in the private aged care system where widespread practices of multiple jobholding led to transmission between facilities.

As 2020 drew to a close Melbourne had not yet fully returned to the office. Up to half of private sector workers and a quarter of government workers were finally allowed to return to the office on 18 January 2021, with further easing of restrictions planned, depending on continued success with containing transmission.  However, public health orders, employer demands to reduce crisis-era labour costs, and workers’ preferences means that working from home seems certain to become a permanent feature of the new world of work: surveys suggest that 81 per cent of workers at home want to keep working from home in some capacity.

Relaxation of top-down workplace practices seems one silver lining of the new working from home (WFH) regime, as employers are forced to shift their focus to output rather than presence. Employers could well learn people work better without others breathing down their necks.

Personally, I have found there’s much to like about WFH. I’ve finally unpicked my blue-collar work ethic to white-collar work, understanding getting the best from your brain doesn’t mean smashing it for eight hours straight. I sometimes intersperse work with playing music, with the piano sitting next to my work desk. However, as well as moving to Melbourne just in time for the lockdown, my neighbour started renovations – a months-long bespoke “mate’s job”, no swift commercial job. Working life became waking abruptly to circular saws followed by endless days of a “soothing downpour” of white noise through my headphones. It is sitting in my closet under a blanket doing radio interviews. Needless to say, I’d like to return to an office – at least on those very loud days. There’ll be workers like me; home workers who want some hybrid between home and external office work. The opportunity to share workspaces with others..

We estimate at the Centre for Future Work that around 30 per cent of the Australian workforce could feasibly work from home: a total of about 4 million workers in total. But that total could not be achieved overnight: it will take time for necessary adjustments and systems to be established. Likely no more than half that total (or perhaps 15 per cent of workers) are able to work full-time from home right now. In many respects, people who can work from home are relatively well-positioned to get through the pandemic crisis. They can continue to earn an income but are insulated from the contagion risks associated with most other workplaces. In contrast, those who continue working outside their homes, despite the lockdown, must confront frightening health risks: most acute for health care workers, of course, but also for many other, often low-wage occupations (like retail clerks, drivers, and cleaners). While they are fortunate to keep working in (relatively) safe conditions, Australians working from home (and other offsite locations) nevertheless confront several important challenges and risks as they migrate their work to a new location. Social media posts dwell on the mental and emotional challenges of home work: like the temptation to wear pyjamas all day, or the distractions of Netflix and the refrigerator. But there are far more serious issues to be considered, as millions of Australians make themselves a coffee, get dressed (hopefully!), turn on their laptops and get to work. 

Moreover, the COVID-19 pandemic is sparking a more lasting shift in the nature of our work. Various home work, telework, and remote work arrangements were already becoming more common before the pandemic, reflecting a range of motivations: including lower labour and infrastructure costs for employers, and greater convenience and flexibility for workers. Now home work is experiencing a more powerful, sudden impetus. And normal employment patterns will not suddenly be restored, even once the health emergency has passed and we are able to go back to work. Private businesses will be organisationally and financially battered by the pandemic; consumer-facing industries will face continuing health-related restrictions on their activity; and desperate workers will seek any means of supporting themselves, including various independent ventures conducted from their own homes. Some workers may prefer to continue working from home, and hence demand flexibility to do so after the pandemic passes. Others will be longing to get back to normal work, and the human interactions that come with it. For all these reasons, therefore, working from home will likely become more common in coming years. For millions of workers, indeed, it will become the ‘new normal.’ Since this form of work is here to stay, it is important to consider the economic and legal issues that will have to be considered as the trend becomes more common.1

Working from home doesn’t suit everybody

People able to work from home are more likely to be professionals in permanent, full-time and better-paid work. In many ways, we have been protected from the worst health and economic impacts on workers. Though this doesn’t mean high economic and social costs haven’t been incurred by the WFH workforce. Risks and costs are mounting, including upfront and ongoing costs of running a home office, long work hours, income and job insecurity for employees with high caring demands, and the absence of a national WFH work, health and safety program. 

Keeping up with our jobs while confronting the constant anxiety of a global pandemic crisis has hurt many people’s mental health. Half of those working from home report increased stress, depression and self-harm. UK research suggests we face a tsunami of musculoskeletal workplace injuries as workers make do with dining tables, coffee tables, and desks ill-designed for eight or more hours of work. This is why we need a new system of workplace protections for workers facing increased isolation and the risk of work intensification. France introduced a law requiring employers to implement software prohibiting emails from being sent outside office hours – this one I like!

But under current workplace laws, employees remain powerless to get out of the house and return to a formal workplace post-pandemic without a corresponding entitlement to return to the office. As the recession deepens, millions of unemployed and insecure workers will continue to face great hardship. The fiscal costs of this mass displacement will be huge, but longer-run social costs – poverty, exclusion, despair, non-participation, declining health – will be even greater.

Working to build more secure labour markets is about reducing risks that major events don’t hit the most vulnerable hardest. Job-creating investment, quality public education and skills systems, income supports, and extending minimum labour standards like collective bargaining are critical to an inclusive post-COVID recovery.

While flexible work arrangements are generally beneficial, it will be important for workers to maintain personal choice in the decision about whether to work from home, and to have the right to come into work when that is preferable. When Australians can once again move freely and leave the home for work, employees should be able to reject working from their private homes if it is unsuitable to their needs. The pandemic is our clarion call to create not just more jobs, but good quality jobs that reconnect millions to the experience of decent, ongoing work. Though we’re fatigued, this is where the work really starts.

1 See the full report and its recommendations here https://www.futurework.org.au/working_from_home_in_a_pandemic_opportunities_and_risks

Alison Pennington is Senior Economist at the Centre for Future Work, associated with The Australia Institute. She conducts research on economic issues facing working people including the future of jobs, skills and training, collective bargaining, sector and industry policies, and the role of government. Alison has held previous roles with the Commonwealth Department of Finance, public sector unions, and music teaching.