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Leaders who mandate a return-to-office will hit a dead end

CEOs who are asking workers to return to a “butts-in-seats” mindset are misguided, says this founder.

Leaders who mandate a return-to-office will hit a dead end
[Photo: Thomas Winz/Getty Images]

In January 2020 I founded a company that handles global employment issues like payroll, benefits, and tax compliance for distributed teams. The timing wasn’t quite perfect, because just two months later, the entire world changed. But we adapted quickly, and in the meantime, remote work became the norm. Despite the complex challenges of the global health crisis, there were clear silver linings.

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From an employee standpoint, the flexibility of remote work is a breath of fresh air. Working parents spend more time with their children. Long commutes have been shortened or scrapped altogether. Wellness routines are now a permanent part of many folks’ lives. By and large the workforce is enjoying the perks of not being stuck at a desk for eight or more hours a day.

From an employer perspective, these same virtues should be cherished. Happier employees are more productive. And yet it seems like every day I’m reading new accounts of CEOs demanding their employees’ physical return to the office.

In my view, this is completely misguided for a few reasons. I’ll speak directly to what most CEOs care about most: business performance.

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Mandates may cause employees to retreat

Return to work ultimatums decrease employer leverage at a time they can’t afford to lose it.

The current job market is highlighted by near-record openings. There is more opportunity than ever before if you’re looking for work. Put simply: Talent owns all of the leverage in this environment. Hiring teams that mandate office attendance are putting themselves at a self-imposed disadvantage when competing for top talent. And throwing more money at the problem won’t help: Even if you’re planning to outbid the competition, job seekers have indicated that they’d prefer to take a pay cut if it meant staying remote.

Your hiring strategy is restricted

By demanding physical office attendance, you shrink the talent pool.

Historically, employers have been pigeonholed to their headquarter-and-spoke cities, forced to hire talent within proximity. Today, thanks in equal parts to worker preference and technology, this is no longer an issue. An organization’s supply of talent can and should be much larger. Employers that are engaging the global talent market are hiring faster, and growing stronger, than those who don’t. In our analysis of 500+ companies who are hiring global employees, Oyster found that 37% were “high-growth startups” growing at a rate of 30% per year. Among all startups in the study, the average talent hiring period was 25-30 days—still distinctly less than the average of almost 40 days according to SHRM. Access to talent supply has become a clear competitive advantage in today’s hiring environment.

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Workers have already moved on

This is not the summer of 2020, when employees were commenting “can you believe we’re still doing this via Zoom?” It’s been two-plus years since the pandemic started. People have adapted and remote work is here to stay. Talented individuals have moved cities, bought homes and made life-changing decisions about their families based on the fact that they’re no longer tied to a commute. For many, a permanent return to the physical office simply doesn’t make sense anymore—and employers who require it are showcasing an outdated perspective.

The upshot of all this is simple: Demanding a return to the office will hurt your business in the short and long term. You will decrease hiring leverage, shrink access to talent and create unhappy employees. Meanwhile, your competitors who embrace remote work and global hiring will do exactly the opposite.

Correction: A previous version of this story misstated the average startup’s hiring period was two times faster than the average company’s reported by the Society of Human Resource Management. The language has been updated to present a more accurate comparison.

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Tony Jamous is the CEO and cofounder of Oyster, a global employment platform that handles hiring, payroll, local tax and other HR issues, which helps the company’s customers hire across borders. 

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