Work has changed forever.

Today, work is no longer black and white (like when we started this report six years ago). Remote and in-office working styles are fluid, with many workers desiring and demanding a blended, flexible approach. Over the past three years, the way we work transformed at lightning speed. Priorities have evolved for both employers and employees alike, pushing flexible and hybrid work - the new way to work - to the forefront.

For the 6th annual State of Remote Work Report, Owl Labs, in collaboration with leading remote work consulting firm Global Workplace Analytics, surveyed over 2,300 full-time U.S. workers in July 2022 to learn their preferences, requirements, concerns, and more - when it comes to all-things work: in-office, remote, and hybrid.

What challenges have employees and workplaces overcome? What opportunities has this new way of work uncovered? And what pandemic habits have become permanent now that hybrid work is the new standard? Read the report to learn more.

1. The number of workers choosing to work remotely in 2022 increased 24% since 2021. And those choosing hybrid work went up 16%. Interest for in-office work, however, dropped by 24%.

2. Almost 1 in 3 (29%) workers changed jobs within the past year, with an additional 9% actively looking for their next role.

3. If the ability to work from home was taken away, two-thirds (66%) of workers would immediately start looking for a job that offered flexibility, and 39% would simply quit.

4. 41% of small companies (10-50 employees) are requiring employees to return to the office compared to 27% of enterprises (10k+ employees).

5. Only one-third (36%) of employers have upgraded their video meeting technology since the start of the pandemic.

6. 62% of workers feel more productive when working remotely.

7. Almost half (45%) of workers say their level of work-related stress has increased somewhat or substantially in the past year.

8. 1 in 2 workers (49%) feel managers view those in the office as harder working and more trustworthy than their remote counterparts.

9. Hybrid workers save $19.11 each day when working from home rather than at the office.

10. 1 in 2 workers (52%) would take a pay cut of 5% or more to have flexibility in working location, with 23% saying they would take a pay cut of 10% or more.

We no longer live in a world where there are solely two types of workers: remote or in-office. Today, many employees are empowered to work when, how, and where they want for different types of tasks. This might look like a combination of in-office collaboration some days, deep focus work at home others, and working from a coffee shop while traveling. Hybrid work presents a challenge to employers to adjust and meet these needs but pays off in the long run in terms of employee satisfaction, productivity, and retention.

So which businesses have conquered the challenges of hybrid work? Not many. Since hybrid work is still a relatively new concept, businesses are actively trying to figure it out and what they are discovering is that hybrid can be complicated.

Employee preferences have evolved - with the main preference being working style. This year, the number of workers choosing to work remotely went up 24% and hybrid work went up 16%, while those choosing to work from the office dropped by 24%.

Workers are clear on what working style works best for them, and if an employer isn’t able to bend to meet their needs, the choice is simple. In 2022, many people looked for new opportunities to change things up. About one-third (29%) of workers changed jobs within the past year, with an additional 9% still looking for their next role. And almost 2x more remote workers switched jobs than those working in-office.

So, what were workers looking for in a new job? Among those who have changed jobs, the top reasons were better compensation (84%), better career opportunities (82%), and better work/life balance (78%). But, before accepting - or even considering - a new role, many workers are ensuring that hybrid and flexible work is an option. If the ability to work from home was taken away, many workers (66%) said they would immediately start looking for a job that offered flexibility in where - and when - they worked. Whereas 39% of workers agreed (or strongly agreed) with the statement, ‘If I were no longer allowed to work remotely or hybrid now or in the future, I would quit my job.’

While many knowledge workers have adjusted to remote or hybrid work, their employers have had an ever-growing list of questions, requirements, demands - you name it - to set their teams up for success. Their first task: creating more flexible workplace policies.

Workers reported that prior to the pandemic, only 8% of their companies had flexible workplace policies in place - whereas today, almost two-thirds (62%) say that their company has implemented at least some degree of flexible work. Mid-size companies (501-5K employees) are leading the way with 70% implementing flexible work policies – more than any other size company. This may be because they are large enough to have the people and resources to update policies in a timely manner and are small enough that workplace changes don't get caught up in bureaucracy.

Before employers implement a flexible or hybrid work policy, it’s also important that they fully understand what their employees are looking for. For example, 42% of employees would prefer to work fully remote, yet only 31% of employers are offering that option. When it comes to hybrid, 31% of employees have a hybrid work preference, and 29% of employers are willing to meet them there - so there is more of a balance being struck. Hybrid work represents a good place to meet in the middle, and meet needs on both sides.

All that said, it’s hard to create a hybrid and flexible workplace policy that meets everyone’s needs. And in trying to do so it can create confusion and stress for both the employee and employer. A majority of flexible work policies have some stipulations attached, with only 21% allowing employees to work anywhere with no limitations. There have even been reports of businesses claiming to be remote or hybrid work-focused, only to change their mind when new employees start. Employers not only have to create a clear flexible policy for their employees - but they need to implement it, and be transparent about the potential of policies shifting in the future. Employees may move, change their caregiving plans or schedule, or make permanent changes to their lives based on flexible work policies - there’s a lot to consider when it comes to being a fair employer.

Creating and implementing an effective flexible policy is just the beginning. Companies need to be intentional about what the physical office space now means, and what type of work is best suited there. This requires careful consideration around the spaces you create, the technology you use and implement, and the ongoing expectations of your employees. Flexible and hybrid work is not by happenstance and companies will be required to create intentional hybrid spaces and define what in-office work really means.

ROOM’S VP of Workplace Strategy + Design, Alejandra Albarran says offices should consist of both ‘hot’ spaces (for loud, collaborative work) and ‘cold’ spaces (reserved for focus work). Going further, we know that nearly all meetings will have at least one remote participant going forward, so if your spaces aren't wired with collaborative technology, you’re excluding some people from participating. Today, only 36% of employers have upgraded their video meeting technology - meaning there is room to grow. This is in line with last year suggesting many companies may have not invested in optimizing this critical technology, or haven’t known where to start.

That said, with 37% of employers closing or decreasing their office space and another 21% making no changes, it's safe to say that some companies have made decisions while others are still in a holding pattern, waiting to make major investments until they are more certain on what the future holds. However, flexibility will be here for the long haul, so employers would be remiss to not invest now in the space and smart technology they need to ensure employees thrive in the hybrid world.

Implementing new workplace policies and rethinking physical workspaces seem to be the first priorities for many organizations. What comes next is equally important, as this year’s data has shown. Employers need to support employees regardless of location by creating equitable working environments, minimizing proximity bias (more to come on this in section 4), and training managers and leadership on how best to manage employees in hybrid and flexible work environments.

To date, 1 in 2 (50%) employers have trained managers on how to manage remote and hybrid teams, and 54% have taught workers on how to hold effective and inclusive hybrid meetings. 48% have provided education on how to use mixed real-time and asynchronous methods of communication to better engage with team members across time zones.

With more and more employees preferring a hybrid working style, some employers are starting to lose sight of just how productive (and perhaps stressed) their employees are on a day-to-day basis. In fact, 60% of managers are still concerned that workers are less productive when working remotely. That may be why over a third (37%) of employers have added or increased the use of employee activity tracking software in the past year.

The reality is two-thirds (62%) of workers feel more productive when working remotely, while just 11% feel less productive. Millennials feel the most productive while working from home (66%), and Boomers feel the least (46%).

Historically, employers have equated in-office work with maximum productivity. This year's data has shown that productivity levels are more dependent on the types of activities employees are actually working on. Workers feel the office is the most productive environment for specific activities, including meeting new people (59%), managing others (51%), and team meetings (51%) - none of which are a total surprise. That said, workers are split on the most productive location for innovating and brainstorming, with 39% preferring the office and 37% preferring the home. This goes against the traditional thinking of the role of the office being for innovation.

We also saw differences by employee age, with Millennials and Gen Z generally feeling more productive at home, while Boomers and Gen X feel more productive at the office. It's important to create a variety of work settings that support a diverse set of working styles and types of work. For example, if holding a brainstorming session, allow people to do independent work at first remotely and then bring the group together in the office to ideate and build off the initial ideas.

The data shows that workers are feeling productive where they work - whether it’s in the office, a coworking space, or at home. That may be one of the reasons they are gravitating to a specific location in the first place. But with all of this productivity, no one can deny that there has been an increased amount of stress and burnout over the past 2+ years.

Workplace stress isn’t a new concept, but with the rise of hybrid work, the traditional way of working comes with new stressors that both employees and employers have to navigate. In 2022, 45% of workers say their level of work stress increased somewhat or substantially when compared to last year. Not only that, the leading source of stress employees are experiencing is unrelated to the workplace. 58% of employees are concerned about an impending recession, which is 9 percentage points higher than any other source of stress.

Knowing that many workers are dealing with stress and burnout, some companies are employing new practices to try and better support them. However, some of their actions are leading employees to feel even more stressed out. Among workers who have experienced an increase in their stress levels, the leading source of their stress comes from being back in the office (53%) - particularly among Gen Z and Millennials. It was also the highest cause of stress for all three types of workers (remote, hybrid, and in-office) - 40% higher than any other contributing source of increased stress.

When employees are located across different locations, time zones, or continents, it can be difficult for employers to ensure that everyone is treated fairly and equally - whether that relates to actively contributing in meetings, getting face-time with leadership, or compensation.

One concern workers have is proximity bias. Proximity bias is the idea that preferential treatment is given to those who spend the most time physically close to us. In the workplace, proximity bias can present itself in a number of ways. It’s most commonly applied when the business or team leaders believe that on-site employees work harder and are more productive than remote employees simply because they can physically see in-person employees doing the work and have to trust that the remote ones are.

And while many of us would like to think this concept doesn’t exist, when surveyed, 1 in 2 workers (49%) feel managers view those in the office as harder working and more trustworthy than their remote counterparts. And 48% of workers are concerned that working remotely means they have less of a say at work and will miss out on opportunities.

Men are more greatly experiencing and feeling the effects of proximity bias. Over half (54%) of men are concerned that working remotely will mean they have less of a say at work and will miss out on career opportunities (this is compared to just 42% of women). And 55% of men say they are more likely to ask the opinion of those they physically work with over their remote colleagues (compared to 43% of women) which could be perpetuating the problem.

While proximity bias may be trending, there are also concerns over compensation. Over half of all workers (57%) say that they feel they should be paid the same whether they work at home or in the office - yet the amount of money workers spend while working at home compared to working in-office is notably different.

Many employers have and are continuing to offer their remote workers work-from-home stipends to balance the additional costs they incur while working from home (think energy bills, home office setup, etc). But in reality, in-office workers may be more deserving of a monthly stipend versus their work-from-home counterparts. In-office workers spend 2x more when working from the office ($862/month) compared to what their remote colleagues spend while working from home ($431/month). The biggest in-office working expenses include the commute ($15 on average per day) and lunch ($13 on average per day).

One area where employers can strive to equal the playing field for their employees is to ensure that everyone is included in meetings.

Remote meeting participants listed their top hybrid meeting challenges as being hesitant to interrupt someone who’s speaking (34%) and not being able to see everyone’s faces, and therefore missing visual cues (32%). These are much different from the challenges those in the room experience during a hybrid meeting. 30% of in-room participants experience difficulty starting a meeting on time due to confusing or unreliable technology. 27% say once meeting tech is working, it’s static and requires them to physically move and adjust to the technology so remote participants can better see what’s happening in the room.

The challenge with these stats is that it means remote workers are unable to participate if they can't follow the conversation fully. In-office workers, on the other hand, are oftentimes responsible for working with challenging or traditional technology to ensure everyone is seen and heard clearly in-room. Not only does this make meetings less effective and productive, it further creates the proximity bias and an "us and them" dynamic.

To bring it back to the top, it has become clear that the way we work has evolved. Employers are now on the hook to regularly listen to their teams to more clearly understand what their employees care about most, and ensure these needs are reflected in their benefits and policies. While many employees still rank compensation (79%) and health insurance/401k (75%) as their most important benefits, many are considering good technology (66%) and flexible location (65%) as a must.

What matters most also differs by generation. With a new generation of employees entering the workforce, perks and benefits may need to be adjusted. Gen Z notes that compensation (73%) and health insurance/401k (67%) are their most important benefits, while they rank office perks (40%) and a dedicated desk (51%) as less important. The old tricks of in-office beer on tap and ping pong tables no longer resonate with these remote-work natives. Whereas 61% of their older counterparts - Boomers - want a dedicated desk at the office as it’s something they’ve been used to for decades.

Flexibility in where you can work is moderately or very important to 92% of all employees - and for good reason. This year’s data supports that working remotely offers a series of benefits to employees. 86% of workers said being able to work from home - at least some of the time - would make them happier. 85% said it would make it easier for them to balance work and life, and 81% said it would lower their stress (as a reminder: 45% of workers said that their stress increased somewhat or substantially compared to last year).

Employees are serious about workplace flexibility and are willing to sacrifice their compensation to achieve it. 1 in 2 (52%) workers said they would take a pay cut of 5% or more of their annual salary to have the freedom to choose where they work - with 2% saying they would sacrifice more than 20% of their salary.

So what should everyone be thinking about next? Concepts like the Metaverse have made front page news over the past year, but is that really what employees (and employers) want? Believe it or not, it’s much simpler than an entirely new virtual reality. Though open to the metaverse and VR, the “progressive” work policies that employees are most interested in all relate to flexibility. 81% of workers would like to have full flexibility in when and where they work; others (80%) would like to try out the 8hr/4-day workweek model which parts of the UK are experimenting with.

From this year’s study, flexibility is clearly the top trend for employees, leaving many employers still trying to figure out how exactly to navigate it. Flexible work - remote, in-office, and hybrid - is proving to be the leading way to recruit, retain, and invite diverse talent into the workplace. It’s time to rethink the office and encourage employees to work in locations that are most productive for them based on the type of work they are looking to accomplish. Today, many employees simply require a computer and internet connection to do their job, and do it well.

Businesses have become more agile since the pandemic, but there is still plenty of room to learn, improve, and iterate. Companies that listen to their employees, and build policies based on their needs and expectations, are more likely to succeed - in both business productivity and employee happiness. In a competitive hiring landscape, employee-driven companies will find better talent and improve retention, too.

The data shows: talk to your employees, learn about their needs and where (and how) they do their best work, update your policies with these insights, and watch your business transform.

Thanks for taking the time to read our report. We hope it will help you transform your organization for the better, and work towards a more flexible future.

Reach out to press@owllabs.com with any press inquiries and questions.

Owl Labs, in collaboration with Global Workplace Analytics, surveyed over 2,300 full-time workers in the United States, ages 21+, at companies with 10 or more employees. This survey data was collected in July of 2022.

Owl Labs

Owl Labs is a collaborative tech company revolutionizing how the world communicates through its inclusive and immersive video experiences. Built for modern businesses, Owl Labs is dedicated to empowering hybrid and remote organizations with its award-winning technology and robust product suite. The company’s flagship product, the Meeting Owl, features a wifi-enabled, 360-degree camera, microphone, and speaker with Owl Labs’ proprietary AI technology that automatically focuses on the speaker using audio and visual cues. In 2020, the Meeting Owl Pro was honored as one of TIME’s 100 Best Innovations. Owl Labs continues to champion the hybrid work conversation with its annual State of Remote Work reports. To learn more about Owl Labs and to join the work and learn from anywhere movement, visit owllabs.com.

Global Workplace Analytics

Global Workplace Analytics is a research-based consulting firm that has been helping employers launch and optimize distributed workplace strategies for nearly two decades. The firm’s proprietary tools include a database of over 6,000 research papers, case studies, and other documents related to where and how people work and a Hybrid/Remote Work Savings Calculator© that a report to Congress described as “comprehensive and based on solid research.” Kate Lister, president of Global Workplace Analytics, is a recognized thought leader on the future of work and a trusted source of insights for news outlets including the New York Times, Washington Post, Wall Street Journal, Newsweek, and many others. In June of 2020, she was one of only three witnesses invited to testify before a U.S. Senate committee on the post-pandemic potential for remote work in government.