WTF Happened to WFH?

A new study released by McKinsey this month finds that the massive US experiment with remote work and hybrid work policies appears to be reaching its conclusion.

Eighteen months ago I described post-pandemic work policies as a three-horse race, with Horse #1, HYBRIWO (hybrid work) and Horse #2, REMWO (fully remote work, more commonly called WFH, or work from home) pulling ahead of the aging horse FULTOW (full-time office work).

It turns out that FULTOW was just biding its time before making a dramatic comeback. The new McKinsey survey of 8,426 employees in 15 different industries finds that by the end of 2024, the percentage working “mostly” (other surveys use the word “exclusively”) in the office had doubled from 2023, from 34% to 68%, with corresponding declines among both REMWO (now 17%) and HYBRIWO (now 14%).

The reversal began happening in early 2024 with smaller firms, but accelerated dramatically last September when Amazon ordered all of its workers to return to work in January 2025. That move gave cover for other large firms like JP Morgan Chase, Nike and others to order their workers back to work full-time. And that set up the Trump administration’s order for all federal workers to return to FULTOW. The McKinsey study found that the percentages vary by sector (retail has gone from 33% FULTOW in 2023 to 87% in 2024; pharma from 18% to 58%; healthcare 35% to 73%), but FULTOW has skyrocketed in every sector.

The reversal is not without challenges. Since the beginning of the pandemic, as remote and hybrid work increased, companies took the opportunity to save on the overhead costs of operating huge in-person offices. Prior to the return to work order, the US General Services Administration had sold or was in the process of selling nearly 6 million square feet of office space formerly used by federal workers. On February 10, the nearly 17,000 federal workers coming back to work at Naval Support Activity found a parking lot with only 5,000 spaces (if federal job cuts continue at the same pace, maybe that’ll be enough spaces!). On the first day of Amazon’s return to office, workers in Houston found there weren’t enough desks; in Seattle “the transportation system groaned.”

*Washington DC’s traffic, always bad, got worse this month.*

The move has also put a strain on workers who have grown accustomed to more flexible work hours, as they seek to find new ways to do caregiving for children or aging parents, face commutes again.

The biggest reason managers give for ordering return to full-time work in the office is productivity.

“There is a perception among senior leaders that productivity is better accomplished in office,” Brooke Weddle, a senior partner at McKinsey, told Axios. “I don’t think you can work from home,” President Trump said in his order to return to the office. “They’re gonna play tennis. They’re gonna play golf… they’re not working.”

Beyond concerns that work-from-home employees are shirking, other leaders argue that return to work makes it more likely that employees will make meaningful connections with colleagues, get promotions by increasing their “face time,” improve mental health through face-to-face interactive environments, and increase innovation, spurred through the kind of chance conversations employees can only have when they bump into each other informally.

*Companies implementing return-to-work policies may need to resupply. I found 6-person office cube sets on sale for $14,950 this week.*

Those arguments resonate with me -- I’ve found very few spontaneous fits of brilliance break out during a Zoom call – but there’s not really much actual evidence — yet — that employers are right.

The largest randomized controlled trial study to date, conducted by Stanford and published in Nature in June 2024 among 1600 employees at a Chinese travel agency, found that workers randomly assigned to be hybrid (working two days a week from home) were just as productive and just as likely to be promoted as those randomly assigned to work in the office every day. And in that study, where decisions about full-time in office vs. hybrid work arrangements were randomized, hybrid workers were 33% less likely to quit.

In the US where many employees have been allowed to self-select work arrangements, the McKinsey study finds companies have a slightly different problem, one that looks a lot like a ticking time bomb.

Nearly 4 in 10 workers surveyed across sectors said they are looking to leave, no matter what their work arrangement. Some 38% of workers who are currently in-person and hybrid say they are looking for new jobs, and 41% of those working fully remotely say the same thing. The million dollar question for companies may be figuring out how to make jobs more attractive and stickier, regardless of where people sit.

Notes:

Amazon RTO policy: https://www.axios.com/2024/09/16/amazon-five-day-in-person-work-mandate

Amazon desk shortage: https://www.wsj.com/tech/amazon-office-remote-rto-commute-ea57fcc4

Return to office trends: https://www.axios.com/2025/02/14/return-to-office-remote-work

McKinsey study on key elements of job satisfaction: https://www.mckinsey.com/capabilities/People-and-Organizational-Performance/Our-Insights/Returning-to-the-office-Focus-more-on-practices-and-less-on-the-policy

Stanford randomized controlled study: https://news.stanford.edu/stories/2024/06/hybrid-work-is-a-win-win-win-for-companies-workers#:~:text=Research%20led%20by%20Nicholas%20Bloom,and%20dramatically%20boosted%20retention%20rates.