Does working from home work? That depends on the home.

MCRE Working Paper
Demographics, Health and well-being, Behavioral Economics and Finance, Real Estate

Working from home (WFH) has risen in popularity during and after COVID-19. There is an ongoing debate about the productivity implications of work from home, but the role of the quality of the home office has gained only limited attention. This paper investigates the effect of the physical characteristics of the home office on productivity and burnout tendencies when working from home. Using a survey of 1,000 Dutch individuals, employees report a variety of home office features, work satisfaction, self-reported productivity, and burnout tendency, as well as their willingness to continue working from home. The results show that self-reported productivity is higher at work as compared to working from home, while the heterogeneity in WFH productivity is directly related to the quality of the physical home office. Higher satisfaction with the home office predicts increased productivity and decreased burnout tendency. Employees prefer the indoor environment (e.g., temperature, air quality, lighting) at home over the environment in the office, but favor the office hardware (e.g., screen, chair, Wi-Fi). Finally, we connect employee behavior as it relates to the indoor environment in the home office with satisfaction scores and productivity. A structural equation model shows that increased ventilation activity during working hours (i.e. the percentage of time the home office is ventilated) increases productivity and the willingness to continue WFH, while decreasing burnout tendency. This effect is fully absorbed by satisfaction with home office characteristics. Given that the physical climate of the home office affects the success of WFH, the results of this paper imply that the move from the office to the home office needs to be accompanied by careful design and investment in the quality of the home office, both its physical and environmental aspects.

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