You’re trying hard to grow your business. You need to earn more, spend less, and operate more efficiently. It can seem like a big risk bringing on virtual employees: how do you know they’re really working when they say they are?
It’s a fair question. But it’s also one that the data suggest isn’t worth worrying about. In fact, remote workers have been shown to be more productive than their in-office counterparts.
Here are 10 powerful reasons why forward-thinking companies should consider hiring virtual employees and the data to back it up.
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1. Increased productivity
Virtual employees are more productive than their co-located counterparts. The numbers might surprise you:
- Working remotely increases productivity by 16%, according to a Stanford study of 16,000 call center employees
- Best Buy’s flexible work program boosted productivity by 35%
- 77% of workers reported greater productivity working off-site in a 2015 study
What accounts for the difference? Many things contribute, but the fact that traditional offices are distracting is a big one. Taking breaks to visit the kitchen, water cooler, and bathroom are big distractions. So are “impromptu meetings” and small talk.
That’s a big problem according to Gloria Mark, a University of California professor whose research reveals that it takes workers an average of 23 minutes and 15 seconds to get back on task after being interrupted. Remote work cuts those distractions way down.
Of course, potential digital distractions abound in remote work arrangements. But employers should consider the conclusion of a survey by BambooHR. They found that “[t]raditional workplace distractions trump digital pursuits when employees are on the clock.”
None of this should come as a surprise to anyone who’s worked in a cubicle. And if you’ve worked in an open or shared office environment, you’ll know that they’re even more brutal, productivity-killing pits of despair.
2. Lower costs
A traditional office requires a lot of three things:
- Space: the physical building(s) where your employees work
- Stuff: everything inside that space (desks, computers, copiers, office supplies, HVAC systems, coffeemakers, refrigerators, toilets, and so on)
- Services: all the utilities and maintenance required to keep #1 and #2 up and running
It’s expensive to say the least. As I’ve mentioned before, I estimate that our remote team saves roughly $100,000 per year on things like leased space, IT, utilities, and other overhead.
We’re not the only ones:
- IBM is reported to have saved more than $50 million in real estate costs by relying on virtual employees
- Aetna saved $78 million by cutting 2.7 million square feet in office space
- American Express estimates saving $10–15 million per year with virtual employees
But that’s not the only place where employers can cut costs by implementing a remote work policy. Employers switching to remote work can save big on payroll, too. An analysis of more than 4,000 studies by Global Workplace Analytics determined that 36% of employees would choose an option to work remotely over a raise. And a survey of 1,500 technology workers found that 37% “would take a pay cut of 10% if they could work from home.”
3. Less sick time
Remember that Stanford study that found virtual employees to be more productive than co-located employees? Those researchers attributed 9% of that increase to remote employees taking fewer breaks and using less sick time.
A 2011 study found that employees working in open offices took 62% more sick days than virtual employees.
And a 2013 report from U.S. News & World Report concluded that “[t]elecommuters log five to seven more hours per week than non-telecommuters, often working even when they’re sick or on vacation.”
Not only do many remote workers report working through the sniffles, but traditional offices greatly increase the spread of germs. Remote employees are losing less productivity to illness, which is good for everyone.
4. Higher morale
When it comes to building and maintaining employee morale, the deck is stacked against traditional co-located teams. Think about it: by the time they sit down to work, many employees have already hustled to get lunches made and kids on the bus, battled bumper-to-bumper traffic, or navigated a frustrating public transit system. Getting time off can be difficult. Office politics is pervasive. Gossip is pernicious.
These are pressures that remote workers either don’t face or can tackle with far greater flexibility than their co-located peers. It’s no wonder that a 2016 survey of 509 full-time remote workers found that virtual employees, when compared to benchmarks calculated from 200,000 employees “across all work arrangements,”
- are happier
- feel more valued
- feel they’re more productive
The difference is stark. A 2016 survey of 3,478 virtual and non-virtual employees found that:
- 24% of people who work in traditional offices say they love their job
- 45% of people who work remotely say they love their job
Mark Murphy, founder of Leadership IQ, sums up his firm’s research this way: “You’re 87% more likely to love your job if you work from home.”
5. Better retention
Employee happiness isn’t just a touchy-feely metric employers can use to feel better about themselves, either. Higher employee satisfaction among virtual employees dramatically reduces turnover.
Deloitte’s Millennial Survey 2017 found that remote work arrangements are “strongly linked to improved performance and employee retention.” And the survey reveals a stark warning: 38% of respondents reported they were likely to leave their current employer within the next two years, with many citing work/life balance and flexibility as major contributing factors.
Improved employee retention is no laughing matter, either. The Society for Human Resource Management estimates the cost of losing a highly trained employee at 213% of salary. Keeping an employee with a salary of $65,000 saves you almost $75,000 over replacing them.
6. Better recruitment
Working remotely means employers can find the best talent anywhere. Hubstaff, for example, has 25 employees in nine countries. As I’ve pointed out before, I’m not limited to finding the best employees in Indianapolis, where I’m based. I’m not even limited to looking in the US. I can find the best employees for our team, no matter where they are. Anywhere in the world.
Remote and startup-focused job sites like Hubstaff Talent, We Work Remotely, and AngelList allow employers to quickly find and hire the most talented virtual employees for any job. This is especially valuable if your company isn’t located in a large urban center and access to local talent is limited.
7. Less stress
A stressed employee is an expensive employee. According to the American Psychological Association, stress costs U.S. businesses approximately $300 billion per year in absenteeism, lower productivity, and employee turnover.
A survey of 3,100 full-time employees found that 35% of workers called in sick even though they were feeling fine. Among employees “faking it,”
- 24% just needed to relax
- 18% needed to catch up on sleep
Regardless of whether or not they opt to work in their pajamas, by enjoying greater flexibility and job satisfaction, virtual employees experience less stress and are more productive.
8. Automated monitoring & payment
Affordable software-as-a-service (SaaS) applications make managing and communicating with virtual employees easier than ever. Remote workers and managers can use software like Hubstaff, Trello, and Asana for tasks like time-tracking and project management, while integrations with services like PayPal make managing payroll a breeze.
Communication is easier, too, with team chat tools like Slack and HipChat, and video chat software like Zoom, Skype, and Google Hangouts. Want to see how these tools can help you? Check out these resources:
- 8 Best Tools for Managing Projects in a Remote Team
- 5 Best Software Options for Employee Timesheets
- How to manage a remote team
9. The gig economy
According to a 2016 survey, freelancers now make up 35% of the U.S. workforce. And that number could be rising to 50% within the next five years. The gig economy means employers can leverage the talents of specialists across the globe, regardless of physical proximity, and scale on-demand.
And because an increasing amount of people are embracing the gig economy, companies can hire at scale when they need it, and scale back when they don’t. During periods of growth, you can quickly bring on a small team of freelancers. When things stabilize, you can scale back without having to fire anyone. That’s how the gig economy works.
With more and more websites allowing employers to find, hire, and manage remote employees, taking advantage of the gig economy is easier than ever before.
10. The environment
By working remotely, virtual employees (and their ) reduce fuel consumption, lower emissions, and require fewer sprawling office parks.
Global Workplace Analytics estimates that if everyone in a “remote-compatible” job worked remotely just half the time, the savings are staggering:
- 54 million tons of greenhouse gas emissions
- 640 million barrels of oil ($64 billion)
- 119 billion miles of highway driving
And as if that’s not enough of an incentive, Nielsen found that 55% of global online consumers were willing to pay more for products and services provided by companies that are committed to positive social and environmental impact. So saving the environment can also help you earn customers. It’s a win-win.
Are virtual employees right for your business?
Are virtual employees right for your business? The answer is almost unequivocally “yes.” The advantages are clear, and the drawbacks are few. Remote workers are more productive, loyal, and flexible — and they cost less. There’s really nothing to lose. If you’re not already starting to build a remote team, you’re falling behind. So get started today!
To see how we built our own awesome remote team, check out “Be a Project Manager: Our System for Hiring and Managing Remote Teams.” You can use the same process we do to start your own high-productivity virtual team. And be sure not to miss our free e-book, No Excuses: The Definitive Guide to Building a Remote Team. It tells you everything you need to know to get started.
Do you use virtual employees for your business? What advantages have you seen? Share your thoughts in the comments below!