The Rising Mental and Monetary Costs of Remote and Hybrid Work in 2023

It’s 2023. The return to the office continues, but are workers ready to trade their coffee-from-home and sweatpants for business casual and corporate lunches? Urban office buildings are back up to 50% occupancy in major U.S. cities, the highest since the pandemic sent everyone home in March 2020.

Unfortunately, desk occupancy isn’t the only number reaching record heights these days. Although the International Monetary Fund (IMF) predicted global inflation had peaked in 2022, the worldwide energy and food prices surge has dramatically increased the average cost of living.

These new challenges have led employers and employees to reevaluate their budgetary priorities. Do the benefits of working in person balance out the costs of commuting? Companies must figure out how to entice workers back to the office while supporting those who want to remain remote.

Checking In on Remote and Hybrid Employees

Over the past three years, much has changed – yet much has remained the same. Workers continue to place high values on their quality of life and mental health, with 65% saying the pandemic has permanently shifted their attitude toward the importance of aspects outside work. And while the “Great Resignation” has ebbed, dissatisfied employees are engaging in “quiet quitting,” performing the bare minimum required beyond their assigned tasks.

For 2023, fully remote is out, and hybrid is in. On the whole, people who can work remotely prefer the option to go into the office two or three days a week, found research by Gallup. Employees enjoy the flexibility and focus of working from home but miss the sense of belonging that comes with a shared environment.

The Savings – and Expenses – of Remote Work

After the 2020 lockdown proved that proximity to the job isn’t everything, many left expensive urban centers and created comfortable home offices in more affordable areas. But how much are remote workers saving?

On the one hand, they’re not paying for expensive commutes (including rail passes and highway tolls) or lunches. On the other, their home expenses are higher. They tend to spend more outfitting their office with comfortable chairs and bigger monitors. Putting in more hours at home also increases day-to-day bills, such as utilities, that they wouldn’t use on company premises.

However, it’s cheaper to work from home. It’s estimated that employees who split their time between working at home and the office save between $600 and $6,000 annually, according to Global Workplace Analytics. This factors in savings on travel and food, as well as expenditures like additional energy costs and meals at home.

There are savings for employers, as well. Hybrid workplaces require less real estate, amenities, and overhead than those with entirely on-site workers. For every half-time hybrid employee, the typical US employer can save an average of $11,000 annually, projected Global Workplace Analytics.

Remote and hybrid workers prize their flexibility so much that they’re willing to take a pay cut rather than return to the office full-time. Forty-four percent of employees are eager to give up at least five percent of their salary in exchange for a say in their workplace location. This can translate into further savings for employers offering accommodating schedules instead of raises.

Is working from home forever sustainable? >

The Mental Health Toll

Working from home can’t merely be weighed in dollars and cents. The pandemic raised awareness of the everyday mental health challenges facing all front-line and remote workers. Remote workers reported acute loneliness and isolation, physically and emotionally distanced from their colleagues.

Even as people have become accustomed to new modes of personal interaction at work, mental wellness is still declining. Across the board, remote, hybrid, and in-person workers reported lower levels of mental health and overall engagement compared to the previous six months.

Poor mental health is costly for employers, too. Burnt-out employees who don’t leave their jobs outright might quit, quietly trading productivity for their well-being. They may still be showing up for work but no longer giving it their all.

Finding a workplace that promotes mental wellness is a top priority for employees in 2023. Eighty-one percent of workers reported they’ll be looking for a job that supports their mental health in the future.

How Employers Are Helping to Balance Costs

Many employers are pushing for a full-time return to the office, but they must entice employees accustomed to the savings and comfort of working from home. While some companies are issuing ultimatums (“Return to the office, or don’t return at all”), others are putting forth other options.

Some employers offer travel vouchers, free meals, and even concierge services for formerly remote employees who face increased commuting and food costs. Others are redesigning their spaces to feel more like home, with showers, nap areas, and libraries.

Companies that downsize their physical space and reduce overhead can pass some savings back to employees by reinvesting that money into salaries or applying cost-of-living adjustments to base pay.

Employers are also equipping hybrid workers with unified communications solutions to make switching between home and the office easier. Teamwork apps that work equally well from office desktops and mobile phones let employees continue to work seamlessly, no matter where they are.

Companies are implementing changes to promote holistic wellness in response to many workers’ mental health challenges. This includes everything from four-day workweeks and flexible schedules to counseling and health initiatives.

Employers are also focused on improving connections between colleagues, whether they’re in the office or not. Collaboration tools don’t just facilitate interactions. They help build stronger relationships and improve employee engagement.

Invest in Hybrid Employees with Mitel

Support your remote, hybrid, and in-person employees with personalized collaboration tools to offset the rising costs of working and living in 2023. Mitel offers a range of communications solutions for home, the office, and on the go. Contact a Mitel expert today to learn more.