UK ahead of European peers in switching to working from home

The UK’s shift to home working has made it an outlier among most other advanced economies, according to an FT analysis, as the size of its professional services sector and a more flexible labor market are expected to prevent a return to pre-pandemic office occupancy levels.

Months after the last Covid restrictions were lifted, the latest available data shows traveler numbers remain almost a quarter below the levels seen in February 2020, before the coronavirus took hold in the UK.

“There has been a permanent mindset shift in how work is organized among the UK’s previously office-based workforce,” said Jane Parry, associate professor of work and employment at the University of Southampton and author of a recent paper. study on labor practices after confinement.

Parry said nearly all respondents supported some form of flexible working, with many saying working from home was more efficient, not least because it eliminated the daily commute.

Google’s latest mobility data for a Thursday (May 5), the peak weekday for office work, showed commuter numbers still 23 percent below pre-pandemic levels. This is virtually unchanged from last September, pointing to what could be a new post-pandemic norm.

Bar chart for 5 May percentage change compared to February 2020 showing travel to workplaces has not resumed in the UK

This is more than double the levels in most other European countries using equivalent data, with Germany and Italy just 7 per cent below pre-pandemic traveler figures. The US and Canadian data are more similar to the UK, but still suggest that more workers have returned to the office.

Nick Bloom, an economics professor at Stanford University, said the UK, along with the US, had seen a marked change in the number of people using a hybrid work model, with home-based work “ very rare” before the coronavirus arrived. “Post-pandemic, it seems like those employees are going to work, on average, two or three days a week in the office and two or three days a week at home,” he said. saying.

a global poll of 33,000 people in February by WFH Research, a unit run by several North American universities including Stanford, showed that the UK had the most paid working days from home each week in Europe.

It also found that Britons believed home working had increased their efficiency more than people in other European countries and that the UK had the highest proportion of employees who said they would quit if forced to return to the workplace on time. complete.

Jack Leslie, an economist at the Resolution Foundation think tank, said a combination of factors had contributed to the apparent success of working from home or hybrid in the UK, including a large proportion of computer-based jobs. “The UK is a service-based economy, which means more jobs can be done remotely and permanently,” he said.

Around 80 per cent of UK workers in information and communication, as well as nearly two-thirds in professional and scientific services, work from home or use a hybrid model, according to the Office for National Statistics. This compares to an average of 28 percent across all industries.

Travel time and costs are also generally higher in the UK, a major factor at a time when households are facing the most severe decline in living standards in decades.

Christopher Pissarides, professor of economics at the London School of Economics, said another reason the UK is an outlier is the more flexible and less regulated labor market compared to other European countries.

The discrepancy between the UK and some industrial economies, such as Germany and Italy, in numbers returning to the office has been mostly constant in recent months.

Pissarides said he expected the size of the UK services sector to mean the gap with other advanced economies with a higher share of manufacturing jobs “should persist”.

Data from Freespace, which tracks office use largely by monitoring the largest professional services firms, found that UK occupancy rates were around 30 per cent in the first week of May, the half the rate before the pandemic.

The reluctance to return to the office is particularly acute in London, which has a higher concentration of professional services than anywhere else in the UK. The latest data from Google shows that trips to workplaces in the capital were down by more than 30 per cent compared to pre-pandemic levels in early May.

Statistics from Transport for London suggest the problem is even more acute. The number of people passing through the city’s stations on the last Thursday in April was near the highest levels since the start of the pandemic, but was still 42 percent below levels before the coronavirus hit.

“The cost of traveling to work in terms of time and money is generally higher in London, and some people may still be concerned about using public transport, which is the main way to travel in London,” said Yael Selfin, an economist at KPMG.

Pissarides said he believed the technological and organizational changes made by employers to allow their staff to work from home had helped bring about permanent change for many UK workers. “I think hybrid work is here to stay.”

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