Study: Remote workers pay hidden fee for flexibility

Note from the Editor: Your subscription to Finance & Commerce includes business content from The New York Times. Erika Becker is a Sales Development Manager at Verkada. She asks her boss questions 10 times or more a day. "Did I do that right?" She asks. What could I have done differently?

Becker, 28, works in her San Mateo office five days a weeks, with her co-workers. Her new routine is a radical departure from her former role at Yelp where she often worked from home, and spoke to her boss only once a week. Becker discovered a new benefit of working in an office: feedback. There's a lot of feedback.

She said, "It's as if I had something in my mouth, and I'd like you to let me know." Because I want to advance in my career.

The pandemic has brought about a rapid change in the workplace, far more than was anticipated by the researchers who studied its effects. Over 50 million Americans, mostly in white-collar positions, started working at home part time. The flexibility was a big draw for many, particularly working parents. Many employees, including those at Amazon, Disney, and Starbucks, have refused to return to work when large employers have attempted to do so in recent months. They cited their productivity record while working from home.

According to a paper by economists from the Federal Reserve Bank of New York and Harvard, remote workers could be paying a hidden penalty in terms of their professional status. This is one of the first major studies that shows the downsides to remote work.

The economists, Natalia Emanuel and Emma Harrington, studied engineers in a large tech company. The economists found that while remote work increased the productivity of senior engineering, it reduced the feedback junior engineers receive (in the form comments on their code) and made some junior engineers more likely to leave the company. Female engineers were most affected by the effects of remote working, particularly in terms of feedback.

Harrington, an economics professor at the University of Iowa, said that remote work has a trade-off between now and later. Particularly junior engineers and younger engineers receive less feedback when they are remote.

The findings of the study are preliminary and narrow. They measure only one type of interaction between a group of employees at a technology company. The authors' findings, however, suggested that their study was more general: the office played a significant role in the early career development of a certain kind of knowledge worker. The mentorship and training people receive in person has been difficult to replicate using Slack or Zoom.

In an interview with the Federal Reserve Bank of New York this month, Emanuel said, 'Grandparents have been saying it for a very long time.' Face-to-face meeting is very different from FaceTime.

The research has confirmed a sentiment for some major employers that guided their decisions on hybrid work. 'It is hard to duplicate the opportunities for learning and apprenticeship that come from face-to-face interactions', said Sara Wechter. She is the head of Human Resources at Citi where the majority of employees spend at least three full days in the office each week.

Researchers have found it difficult to quantify the intangible benefits that come with in-person work. The majority of existing studies on remote work focus on call centres or other workplaces that are easy to measure and define, but may not be as important for creativity, mentorship and collaboration.

Emanuel, along with her colleagues, focused their attention on software engineers working at a Fortune 500 company that the researchers agreed to remain anonymous. Before the pandemic some engineering teams were located in the same building. They held meetings and interacted with their colleagues in the cafeteria. Some teams were spread across buildings, and most meetings were held online in order to avoid the 20 minute walk around the campus.

The economists could measure feedback by counting the number of comments made by engineers on each other's code. This is a common and important form of interaction in most software companies. Before the pandemic they found that engineers who worked in the same building got 21% more feedback compared to those in other buildings. After the pandemic, everyone began working remotely and the feedback gap almost disappeared. This suggests that it was the physical proximity of the teams, not any other differences, which led to the greater feedback received by in-person teams.

Researchers found that the 'power proximity', as they call it in their title, was especially strong for newly hired engineers and younger workers. Women also benefited from this phenomenon. For example, engineers younger than 30 received more feedback from more experienced colleagues, but only when they were in the same building.

Emanuel stated that 'these effects are very concentrated'. The junior engineers who are also younger are the ones that will benefit most from attending in person. You might think that those groups have the most to gain.

Remote work is a real benefit for many employees. This includes working parents, and those who have to balance work and home. According to a FlexJobs survey, 52% of women said that they would look for another job if they were no longer able to work remotely. 62% of both women and men stated that remote work allows them a better balance between work and life.

Becker credits her success at Verkada to the amount of time she spends in the office. She is now a more critical supervisor, and she's comfortable asking her 19 sales reps to talk about ways to improve.

She said, "When I first started as a manager I was everyone's biggest cheerleader." What I struggle with is having difficult conversations.

She changed her career path because her boss, who sits right next to her, told her, "Hey, I know you gave feedback." Are they implementing the feedback?

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