4 August 2021

The Government should stop ‘nudging’ and let the work from home economy evolve


Rishi Sunak has been sharing details of his early career, telling us about the importance of mentoring when he was a young banker at Goldman Sachs. Strong relationships, he says, are essential to career development and can stand you in good stead throughout your working life.

This is just the latest in a series of explicit and not-so-explicit nudges from various government officials to try and get people back to the office. Boris Johnson dropped a clanger back in March by suggesting Brits had enjoyed “quite a few days off” despite the evidence showing UK home workers were putting in an extra two hours per day since the start of the pandemic. This followed the equally well received campaign last year to encourage workers to return to the office or face a higher risk of being sacked.

Setting aside the poor messaging, it isn’t clear why ministers feel the need to say anything here at all. Employers and employees are best placed to decide between themselves what works for them. If companies have found homeworking has reduced costs without decreasing productivity, they may well wish to ditch the office entirely. Equally, employees who have hated sitting at their kitchen table for 18 months, fighting against poor Wifi signal and background noise from housemates, may well want to return to the office and water-cooler conversations.

This whole debate also ignores the fact that a significant number of people have had to continue going into work throughout the pandemic and many of those who have languished on furlough need to return to their workplaces regardless. Doctors, nurses, hairdressers, plumbers, gardeners, retail workers, the entertainment and hospitality sectors, and transport workers are all either back at work or never left. According to the ONS, only 25.9% of people worked from home

Of course, the Chancellor does have a point. If we look exclusively at those who have worked from home over the last year and their views on returning to the office, there is a clear divide between older and younger workers which – as so many things in British politics often do – mirrors the divide in home ownership. Older, middle-class homeowners who have already graduated to senior positions in their professional, white-collar organisations benefit from home working because it allows them a better work life balance. Gone are the early mornings and over-crowded commutes, swapped for a comfortable day in the private home office and clocking off in time to put the kids to bed. It is the younger workers who will suffer, not just from uncomfortable working conditions but, as Sunak says, from limited contact with colleagues. We learn from doing and seeing and how can new employees, especially in the early years of their career, grow and develop when their only relationship with managers and colleagues is via Zoom.

But it is far from an entirely negative picture. The rise of homeworking may in fact help achieve one of the Government’s other stated aims – levelling up. If proximity to the office becomes less of a concern for workers, they may feel more able to stay and live in areas with affordable housing and spend their earnings in the local areas most in need of a boost instead of propping up inner city sandwich chains. (Incidentally, the idea we should come into work to help particular businesses survive gets things the wrong way round. If people’s working habits change, new businesses will spring up to cater to their needs – it’s totally counter-productive to work against the grain of that process.)

The runner up at the recent Richard Koch Breakthrough Prize was Michael Dnes, a civil servant whose idea was the creation of ‘Zoom Towns’. His entry proposes areas which would intentionally attract remote workers and have an economy built around them. “Rather than a few isolated individuals in offices and spare rooms, these people are a key part of the town’s economy and wider life,” Michael writes. Perhaps the creation of whole new towns is unnecessary though. Towns within touching distance of London could easily pivot to attracting remote workers who may only have to commute into the office a day or two a week, by offering a more relaxed lifestyle and more affordable housing than the capital.

In the end, it’s still too early to tell what the long-term impact of the pandemic will be on our working lives. Some may decide in 18 months that hybrid meetings are not the future and a slight increase in productivity isn’t worth the loneliness of working from home. Others will ask why they can’t continue to work remotely and maybe move to an area where they can afford a larger home and better quality of life. While local councils may wish to work with the private sector, public transport companies and others to adapt to changing working conditions, national politicians should not seek to guide or plan these outcomes.  These are decisions for employers and employees to agree on. Let businesses and workers test different working arrangements – under normal circumstances, not pandemic-enforced ones – and see which models work the best.

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Emma Revell is Communications Manager at the Institute of Economic Affairs.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.