Productivity of Working from Home during the COVID-19 Pandemic: Panel Data Analysis

Using panel data from original surveys conducted in June 2020 and July 2021, this study analyzes the changes in adoption and productivity of working from home (WFH) during the COVID-19 pandemic. First, the results indicate that the mean WFH productivity has improved by more than ten percentage points in the past year, although it is still approximately 20% lower compared to when working in the office. 1) "Selection effect" arising from the exit of workers with relatively low WFH productivity from the WFH practice and 2) the improvement in WFH productivity through the "learning effect" contributed almost equally to the productivity growth of WFH. Second, additional working hours extracted from reduced commuting are approximately 3.0% and 0.7% of the total labor input of WFH workers and all workers, respectively. Even after adjusting for additional working hours from reduced commuting, the conclusion of relatively low productivity at home remains essentially unchanged. Third, the percentage of employees who want to continue frequent WFH after the end of the pandemic has increased substantially, suggesting that WFH may become a popular workstyle.

This is the English version of the Japanese Discussion Paper (21-J-041) with some additional information and changes.

Published: Morikawa, Masayuki, 2023. "Productivity dynamics of remote work during the COVID-19 pandemic," Industrial Relations, Volume 62, Issue3 (2023), 317-331.
https://onlinelibrary.wiley.com/doi/10.1111/irel.12327