As we are all well aware, the economic recession caused loss of jobs, a decrease in industrial production and manufacturing, and a downfall in consumer spending. Large businesses saw profits decline while many small businesses struggled to keep going or ended up filing for bankruptcy or closing down altogether. In companies that down-sized and layed off staff, employees who were left had to work harder to keep up with productivity levels.
In the wake of the recession, some companies considered hiring staff to work off-site as a viable option for saving money and still maintaining productivity levels. That’s how the concept of telecommuting, or working virtually, became a popular economic alternative to hiring full-time staff and companies could hire staff on a contract basis.
The economic benefits of telecommuting are worth considering for any business owner, or a company that has 10 employees or 10,000. Here are some examples of bottom-line savings and personal perks:
Cut Down on Real Estate Costs
In 1992, Ernst & Young found that one way to cut down on real estate costs was to have employees frequently in the field with clients and reserve in-house private workstations only when they need it. The firm cut their office space requirements by 7% in the first year and save approximately $40 million dollars a year by reducing office space.
When AT&T started a telework pilot program in Arizona in 1990, teleworkers saved 3,705 hours of drive time and $10,372 in travel expenses. AT&T estimated they saved an average of $3,000 per teleworker annually in real estate and associated costs. By 1992, AT&T had adopted a corporate telework policy. Since then the number of U.S. based AT&T managers who telework has grown to more than 50 percent.
IBM indicated their company saved $70 million dollars in 1994 by eliminating 22 million square feet of office space in the Northeast U.S. and using the hoteling method in a converted warehouse in Cranford, New Jersey.
Call in Content, Not Sick
On average, an employee misses 5 to 6 unscheduled work days a year, costing employers about $80 billion a year in lost productivity. Reducing the absentee rate by just one day could add dollars a company’s profit margin.
Low morale and stress-related illness have long been known as factors contributing to absenteeism. Does teleworking reduce stress? Yes. A study by Radcliffe College proved that workers in a telecommuting situation experienced a significant reduction in sleep-related disorders. The majority also telecommuting has positive effects on their ability to balance life and work.
Workers who commute to work and are stuck in traffic gridlock are already stressed before they start their workday. This can affect their productivity and lower morale if commute traffic problems occur every day.
Convinced yet? Listen to this: by providing a family-support program, Johnson & Johnson found that employees cut their sick days in half compared to other workers. And a study done for the Small Business Administration even found that telecommuters do not smoke, drink or use drugs as much as people who do not work at home!
Telecommuters get more work done because they have more time. They aren’t late for work because they are stuck in traffic gridlock when they don’t drive to the office. They experience fewer interruptions because they don’t socialize by the coffee machine or spend unproductive time for office gossip or employee talk about what movie they saw last weekend. They take a shorter lunch breaks, mid-morning and mid-afternoon coffee breaks.
AT&T reported that their teleworkers were 70 percent more productive due to a lack of interruptions and fewer meetings. The National Work-at-Home study conducted in the United States by a marketing research firm, Link Resources, found that employees increase productivity by approximately 20 percent on average by telecommuting/working virtually.
Why Don’t We All Do It?
Despite overwhelming positive evidence of the benefits of telecommuting, there are several reasons why telecommuting is not yet a mainstream government and corporate practice.
Most companies still insist on measuring results by the number of hours worked and activity levels when employees are physically present every day to work in the office. By having employees telecommute, companies will base results on performance management and goals accomplished by the increase in productivity. An element of trust and guidelines are required to highlight company goals to keep employees on track.
The type of job is a major factor in determining who can and can’t work from home. Some jobs such as receptionist or customer service just require more contact with a supervisor, other employees or the public while other jobs may require specialized equipment that would be too expensive to move.
Here are some types of jobs best suited to a flexible work arrangement:
Thinking and writing jobs such as reporting, data analysis and grants or case reviews
Information processing such as accounting and bookkeeping
Telephone-intensive positions such as setting up conferences and obtaining information
Computer-related tasks such as programming, data entry, transription, and word processing.
These type of jobs would be for writers, editors, scientists, investigators, psychologists, environmental engineer, budget analysis, tax examiner, graphic designers, project managers, and computer specialists. The longer the employee has worked in these types of jobs, the more the telecommuting situation works even better.
In conclusion, the benefits to companies of hiring a virtual contractor (or virtual assistant) is that productivity will increase, goals will be achieved while saving money on lost time due to office gossip interruptions, long lunch breaks and coffee breaks, sickness and on office space and other office expenses.