Tech companies are still all-in on hybrid work

• Despite back-to-the-office mandates at Amazon and Dell, the tech world seems to still favor hybrid work.
• Research from Flex Index suggests that working from home is booming in the tech industry.
• Experts say hybrid work boosts recruitment and retention and could be crucial amid tech talent wars.

Some tech workers are being pulled back to the office — whether they like it or not.

Unpopular back-to-office mandates at Amazon and Dell have made headlines in recent months as workers protest strict new rules.

But while it may seem like workers are losing the battle for remote work, research suggests that hybrid work is still the norm in the tech industry.

A study by Flex Index, a platform that tracks flexible work policies, found that most tech companies still had hybrid or remote policies as of this summer.

The research, which looked at the policies of 2,670 companies, found that 79% of tech companies in June were “fully flexible”, meaning they did not require office time from employees – a slight increase from the same survey in June 2023.

Only 3 percent of tech firms required employees to return to the office full-time, compared to 18 percent of companies that were “structured hybrids,” meaning some office days are mandatory.

The picture was slightly different at the biggest tech companies. The more employees a company had, the more likely they were to adopt a structured hybrid system.

Only three-quarters of companies with more than 25,000 employees had adopted a structured hybrid policy, while 37% of technology firms with 500 to 5,000 employees had a hybrid work policy. The data suggests that Amazon and Dell are outliers in the tech world.

Compared to the same research published in June 2023, tech companies of all sizes have moved at least incrementally to hybrid work, with larger firms leading the charge.

“On the employer side, I think most of them would prefer to go back to their normal work schedule,” Peter Cappelli, a management professor at the Wharton Business School, told Business Insider.

“But it’s a huge irritation for employees to withdraw a benefit that employees really value, especially when employers don’t give them anything in return and haven’t made much effort to convince them why it’s needed,” he said. .

As Big Tech companies consider how far to take their RTO policies, one thing is clear—hybrid work is the must-have edge in the race for top talent.

The talent wars

Employees like flexibility at work. In a survey of 17,087 employees by Stanford economist Nicholas Bloom, workers said they valued the right to work two or three days a week from home as valuable as an 8 percent pay raise.

Employees with strict RTO mandates at Amazon and Dell have been vocal about their lack of enthusiasm for the new rules, with some at Dell foregoing promotions in favor of staying away.

In today’s landscape, this likely means that Big Tech companies with a hybrid work policy will have an advantage when it comes to recruiting and retaining top talent.

Bloom, a world authority on remote work, told BI that he didn’t expect other Big Tech firms to follow Amazon’s lead on RTOs for this reason.

“Hybrid is too profitable to abandon,” he said. “The evidence is that hybrid is as effective as in-person, but hybrid is better for recruitment and retention.”

He said forcing employees back into the office full-time could result in higher turnover, which can be costly for companies.

The tech world is also engaged in a brutal battle for talent, especially for top AI researchers. Last month, Google paid $2.7 billion in a deal largely intended to bring AI scientist and startup founder Noam Shazeer back to the company.

Cevat Aksoy, associate director of research at the EBRD and associate professor of economics at King’s College London, told BI that his research shows that a substantial part of the workforce highly values ​​the option to work from home. Many are willing to quit or look for a new job if ordered to return to the office full time, he said.

“Companies that adopt full RTO policies may face challenges in retaining talent,” Aksoy said. “Given the growing demand for flexibility and the strong preferences many employees hold, we can expect hybrid work to remain an essential tool for companies looking to remain competitive in attracting top talent.”

However, the five-day RTO initiatives also have their supporters. John Rossman, an Amazon executive in the early 2000s, told BI that the company is making the right move to “Start growing again.”

Efficiency, or else

Over the past year, tech companies have gotten tough on remote workers, monitoring card swipes at the office and disciplining those who don’t follow the rules.

While some big companies like Nvidia have held back, most Big Tech companies have had hybrid policies of varying degrees.

But I make no promises that it will stay that way.

Microsoft and Google, which both have a hybrid policy that allows employees to work from home at least part of the time, recently issued a thinly veiled threat to workers: Keep productivity high if you want to avoid a full-time return to the office.

Aksoy said this worked as a way to ensure accountability among tech workers.

“It’s probably a reminder to employees that hybrid work isn’t guaranteed – it’s about ongoing performance. This kind of messaging helps everyone focus on getting results, giving companies room to tighten policies if they start to see productivity issues or collaboration challenges. he said.

That said, Aksoy still thinks Big Tech is unlikely to bring employees back for five days a week.

“The benefits of hybrid work, for both companies and employees, are simply too significant,” said Aksoy. “Furthermore, the hybrid model allows these companies to access a wider pool of talent without being limited by geography. So as long as productivity remains high, I think hybrid work is here to stay in the tech world.”