Despite some high-profile examples of employers tightening their hybrid working rules, there has been little evidence to date of a widespread return to the office. However, new figures from the Central Statistics Office suggest the sands may be starting to shift.
From a pre-Covid level of about 15 per cent, the proportion of employees who sometimes or usually worked from home surged to 44 per cent during lockdown.
Although it quickly retreated once restrictions were lifted, this proportion never returned to pre-pandemic levels. Instead, it has hovered around 35 per cent since the summer of 2022.
This week’s Labour Force Survey figures hint that things may be changing. For the first time since Covid, the proportion of employees working remotely has declined for three successive quarters, and the number of hybrid workers has declined by 78,000 since the first quarter of last year.
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This may be music to the ears of employers, property investors and city centre retailers whose business models have been disrupted by hybrid working, but it is too early for them to celebrate.
First, the decline is neither pronounced nor well-established enough to call it a trend. With repeated weather warnings impacting commuters through January and February, remote working could well rebound in the first three months of this year.
Second, in absolute terms, nearly 960,000 people are still working from home – more than three times the pre-Covid number.
More ominously, the pullback in remote working may reflect the emergence of less favourable macroeconomic conditions. It has often been said that the ultimate test of hybrid working will be its ability to withstand a labour market slowdown that hands power back to employers.
Although unemployment remains low, the CSO data shows that it has edged-up, and that jobs growth has slowed. The contraction in hybrid working may reflect significant job losses in the service industries where it is most widely used.
Whether due to artificial intelligence or a shift in US firms’ approach to overseas investment, the knowledge-intensive tech and professional services sectors have shed more than 37,000 jobs between them since their highs last year, while employment in the wider office-based economy is down by nearly 50,000.
As the old saying goes, be careful what you wish for.
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