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All I need to work remotely is a laptop and a working internet connection!

Now that may sound like an exaggeration, particularly if you are working long-term for a remote company. The truth is far more complex.

Today though, I want to touch upon only the extra housing costs that remote workers incur and are assumed to pay for on their own.

Remote workers spend more on rent & housing costs

I recently came across this interesting research paper which examines the cost of remote working. The primary argument is that the housing choices & needs for remote workers differ significantly from non-remote workers.

How so? The paper analyses data from 2013 to 2017 and concludes that remote households are 5-7% more spacious compared to non-remote households.

Why? Because remote workers need more space to set up a proper home office/workspace.

Naturally, need for more space ⟹ increased housing costs.

How much more do remote workers spend? On average, 7% more of their income on housing compared to their counterparts who commute to office!

Where does the problem lie?

Now the primary assumption in the paper is that remote workers still live in the same area/city where their in-office counterparts stay. The problem drastically reduces if remote workers relocate to less expensive areas, which in fact is supposed to be an advantage of remote working.

But the core problem lies with hybrid becoming the norm & future of work. When you expect your employees to travel to office few days a week & work remotely for the rest, you are restricting people to stay back where they are. In turn, this means they have to look for more spacious homes in the same expensive area.

Companies are still saving on office space rent but it is the employees who have to pay extra for the housing costs.

Allowing to work from anywhere is the best solution

The moment companies don't restrict relocation for employees, the cost savings for both companies & employees increases drastically. However, if companies are adamant on only embracing hybrid remote & restricting employees to staying within a certain distance of an allocated office (Google hinted at this few months back), companies must also provide for the additional housing cost. 


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    I like to maintain my home office independence from my employer's furniture, wifi, monitors, mice, and keyboards. (I've been working remotely for a variety of employers since 2005.)

    Maintaining my independence makes it easy for me to transition quickly if/when required. The reality is that we live in a world of continuous reorganization if we choose to work for someone else. Better to be prepared than to suddenly have your entire work capability infrastructure disappear if an employer does a sudden layoff. 

    Maintaining my equipment means I get to choose equipment quality and performance (critical with chairs, keyboards, and mice). Keeping my home office as if I am self-employed allows me to quickly pivot to take contracts if unfortunate need be. 

    The big point is to set up my dedicated workspace to my specifications as much as possible such that there's minimal interruption to my ability to work if my circumstances change.

    If need be, I can return an employer’s laptop quickly, turn around to my other desk with my equipment, and get back to work - whatever that work may now be. 

    My remote work motto: "be prepared!"

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      Lots of great point made,  Hrishikesh. 

      Here's my 2 cents:

      - Ideally, the company should be paying for all the necessary equipment as well as an extra allowance for utilities for someone who chooses to opt for WFH. But it's not an ideal case. There's still and probably will stay for some more years/decades a factor of lack of "trust" between the employers and the employees. 

      That said, I do see a future and hope for such one, where more and more companies will adopt completely remote (countrywide/worldwide) with more global work practices.

      - As for companies going forward with a hybrid work model, I can understand companies like Google have opted for those given the HUGE investment they have made in their infrastructure and onsite facilities. 

      I think it's more of a natural step to move towards working from anywhere, like an intermediate step. I am always of the belief that radical changes cause much friction, and need to be taken slowly. 

      However, I completely support companies that have made the decision to go fully remote! Would love to have that freedom! 

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        Well said Prerak. I also believe hybrid is a nice way to transition to full remote, we actually did that ourselves at Flexiple and in fact, there can multiple levels of hybrid through which you can progress to full remote.

        But I also think that companies should commit a timeline (at least tentative) upfront to go full remote in future. Also, the hybrid model where people have to travel to office some days a week & stay within commuting distance of an allocated office is the worst I feel. It just imposes too many restrictions on individuals without offering the advantage of either in-office or remote. At the minimum, relaxing the constraint of working only from an allocated office is a fair ask even in the transition phase.

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          You are ABSOLUTELY right about having a commitment to move to full time remote. I also do believe Hybrid work model does put a lot of constraints on the employee, specially with housing costs in expensive cities. 
          I am sure in coming days, companies will warm up to idea of going completely remote. 

          Would just like to point out that, meeting in person once/twice a week/month with your colleagues can have a positive impact on productivity, mainly because I believe that it helps break the monotonous remote life, and good to build a person's interpersonal skills (of which not everything can be developed doing remotely).

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        Hey, Hrishikesh I think this is an incredibly interesting research report and brings up the point of the potential disparities that can happen between in-office employees and remote employees. 

        The point I would like to add is that many countries have taken notice of these differences and are working to enshrine remote work into their legal code.

        Germany is passing a law that would give remote workers a 600 euro tax rebate for their home office expenses

        Spain already passed a law last year that requires employers to stipulate what they will be providing for their remote workers in their contract. It will be compulsory to provide equipment for working from home, reimburse additional expenses, and ensure a safe and healthy environment. 

        Mexico passed a law at the end of last year requiring a contract between an employer and a remote worker. The contract guarantees compensation for the costs of electricity and internet as well as the right to disconnect when they have reached their working hours for the day.

        In the U.S., California became the first state to legally require companies that employ remote workers to provide adequate seating when primarily working while seated.

        I think this trend will continue to develop and eventually become a standard benefit in many countries that value labor laws.