Remote work increased dramatically during the COVID-19 pandemic, when many companies sent their workers home to maintain business operations. More recently, however, many companies have been pushing for a return to the office. Only about 22.6% of employees in the United States were working remotely in March 2026, compared to 23% in March 2024. 64% of employees also say they would prefer to work remotely or have a hybrid option. Companies even experience better overall retention when they allow remote work. However, as workplace expectations continue to evolve, work-from-home productivity remains a key consideration for businesses. Many employers continue to push for a return to the office, and 64% cite increased productivity as a key reason. However, a recent study published by the Bureau of Labor Statistics provides data on work-from-home productivity and its potential impact on the office.

What the Study Found 

The study examined total factor productivity (TFP) across 61 industries, including data processing, Federal Reserve banks, management, insurance carriers, and other industries that require detailed, precision work. Overall, TFP tended to increase during the period when workers were able to work remotely. The rise in remote work led to about a 1.2% increase in TFP, averaged across industries. Furthermore, top industries saw an increase in worker output without a corresponding increase in labor, including data processing, internet publishing, information services, and computer systems design. What does that mean for individual companies’ work-from-home productivity? It means that in many cases, workers can be substantially more productive when allowed to work from home. This can make it well worth the effort to provide hybrid or remote options for those employees. 

Why Remote Workers Can Be More Productive

Remote workers can experience higher productivity for several reasons.

More Time on Work Tasks

On average, remote workers spend an estimated 48 additional minutes each day on work-related tasks. Because they have removed the inconvenience of commuting, they may be able to spend that time actively working, allowing them to focus more on work-related tasks.

Decreased Distraction

Many employers believe that working from home will introduce substantially more distractions to the workday. Ultimately, however, the in-office environment can create its own distractions, from a larger number of people moving around to the general noise and bustle of a crowded office.

Better Work-Life Balance

Remote employees often have considerably better work-life balance than their in-office counterparts. They can take care of home tasks in between work-related responsibilities, engage in personal hobbies while waiting, or relax in a comfortable environment tailored to their needs. That work-life balance can ultimately lead to better focus and engagement at work. Overall, this improved work-from-home productivity can benefit both employees and employers.

Lowered Stress

Working from home can reduce a great deal of stress for many employees. That decreased stress typically leads to better engagement, which results in more time and energy spent on the work tasks that require attention.

The Real Challenge: Managing Distributed Teams

While remote work can significantly improve employee productivity, morale, and engagement, managing distributed teams can be difficult for employers. Remote worker satisfaction increases significantly, but maintaining satisfaction and productivity requires effective management solutions.

Performance Evaluation

One of the key challenges of managing remote workers is evaluating their overall performance. Managers have to be deliberate about checking in on remote workers, monitoring their progress, and determining their effectiveness. However, they also need a plan for delivering that feedback regularly. 

Communication

Communication is one of the biggest challenges impacting work-from-home productivity. Remote workers often work at different times based on their schedules and needs. They can be completing tasks across time zones, requiring the use of asynchronous communication tools to share information and keep up with project progress. Communication can also be difficult when employees prefer different tools, such as email or internal messaging, instead of phone calls.

Trust in Productivity

Managers often have a harder time trusting that employees spend their time productively. It can be more difficult to track what employees are actually doing throughout the day. This lack of trust can lead to micromanagement or time-tracking strategies that fail to account for employee needs. In many cases, this can further weaken trust on the employee’s side. Building a culture of trust on both sides can give employees more freedom and ultimately increase work-from-home productivity as they manage their time according to their needs.

Culture and Connection

While remote work offers several potential advantages, it can make it far more difficult to maintain a company’s culture and create an essential sense of connection between employees. Employers must often be more deliberate about building those relationships and protecting their culture across the company. 

Compliance

Remote employers may have a harder time navigating compliance requirements. Because employees can work from anywhere, companies may need to meet the requirements of each state or country where they have employees. Using an Employer of Record (EOR) can help streamline that process and make it easier to maintain compliance, no matter where your workers are.

Key Takeaways for Employers

This recent study provides employers with several key insights about work-from-home productivity.

• Employee productivity and output often increase with remote work, making it an essential tool for companies across the board.
• Remote employees may experience lower stress, better work-life balance, and increased engagement due to their ability to work from home.
• Employers may struggle to manage remote employees, but the right tools, including communication strategies and plans for setting and managing expectations, can make the process easier.

If you’re struggling to manage remote workers, we can help. Contact us to learn more about our status as an employer of record and how we can help ensure you comply with all state laws, including payroll and reporting.