The complexities of running a business can be daunting, especially juggling sky-high rental expenses, disengaged employees, and unforeseen absences due to health issues. Remote work provides a viable solution to these problems. Read on to find out how remote workers can help in cost-saving for your business.
The pandemic-impacted year has truly highlighted the advantages of remote work. Despite initial glitches in the transition from in-office to telecommuting among unprepared employees, it has emerged as a highly effective system. Digital giants like Twitter, Apple and Square have adapted well to the remote work model and even offered their staff a choice to work from home. This demonstrates the feasibility and success of distributed teams.
Remote work has brought about apparent advantages to both employers and employees such as enhanced flexibility and efficiency. The most notable and significant benefit, however, is the cost-cutting that businesses have encountered due to their employees working from home.
Discover 11 Effective Ways Your Business Can Save Money by Leveraging Remote Workers.
Productivity Boost from Remote Workers.
Although there is an ongoing debate about the relative productivity levels of remote and in-office employees, it is clear from research that people work more efficiently when given an opportunity to work distraction-free. Unfortunately, open floor plan concepts in most United States’ workplaces result in a productivity decline of 15%, costing businesses an estimated $600 billion annually, according to TeleworkResearchNetwork. While the exact productivity disparity between remote employees and their counterparts in physical offices remains a subject of variation, a CoSo Cloud survey discovered that remote workers were 77% more productive than their office-based counterparts.
Remote Work Minimizes Attendance Problems.
According to CoSo Cloud, in comparison to office employees, remote workers take 52% fewer sick days. Softchoice’s research reinforces this finding, as around 57% of remote employees continue completing their tasks even during vacations or sick leave. This indicates that remote employees are self-motivated to tackle their work promptly and possess the necessary tools to work effectively from any location.
Telecommuting Reduces Employee Turnover.
As per a Gallup survey, remote workers had a higher engagement rate (32% compared to 28%) than in-office staff. Employees who can work remotely can save up to £5,000 annually, leading to greater loyalty to their employer. A study by an insurance firm found that by allowing certain employees to work remotely, there was a significant decrease in attrition rates, resulting in zero turnover and an 18% productivity boost.
Remote Work Aids in Cutting Healthcare Costs.
FlexJobs and Mental Health America conducted a survey revealing that those who work from home or in a distributed workforce setting fall ill less frequently than those working in open-plan environments. The survey comprising 800 participants, indicated that 48% of remote workers experienced an excellent work-life balance, opposed to only 36% of office-based staff. Reducing stress and elevating morale improve overall health, making remote work a cost-saving measure for small business owners in terms of health insurance expenses.
Remote Work Exempts Costs of Workplace Injuries.
Business owners are responsible for ensuring their employees’ safety and wellbeing under the Occupational Safety and Health Act (OSH Act) of 1970. However, workplace accidents and injuries continue to be a significant financial hindrance for US companies, with a cost estimation of $59.9 Billion per year, according to the Liberty Mutual Workplace Safety Index 2023 report. Additionally, employers must ensure employees are covered by workers’ compensation insurance, but this does not extend to remote employees unless extraordinary circumstances arise.
Remote Work Dismisses Commuting Perks Demands.
To support their staff in their daily commute, several firms are now providing a commute benefit. This could be viewed as a company perk, or it may be mandated by law in San Francisco, New York, and the District of Columbia. The Internal Revenue Service has authorized the use of pre-tax money allocated to transportation expenses, allowing employees to claim up to $260 each month, starting in 2023. For businesses who employ a remote workforce, this provides significant savings. For instance, a small remote organization with 10 workers can save monthly up to $2,600.
BYOD Offers Cost Reduction in Office Equipment and…
There is no definitive answer as to which technology to provide for remote employees. Employers may choose to provide them with the essential tools such as computers, telephones, and stationery to work remotely, or offer a monthly allowance. Another increasingly popular option is to enable staff to utilize their laptops or smartphones as part of a Bring Your Own Device (BYOD) policy. A Cisco report showed that 64% of workers already do this, and 89% of businesses allow it. It is estimated that BYOD policies could potentially save US enterprises up to $3,150 per employee every year.
Remote Work Provides Business Continuity Savings.
Every reputable organization must have contingency plans in place to ensure its survival in the face of catastrophes. This is especially crucial when all employees are based in a single location, resulting in higher risks when disruptions occur, whether caused by a snow day or a severe terrorist attack. Although security measures, IT backup, and adequate fire safety gear remain necessary for remote teams, the added costs of earthquake protection, CPR training, and insurance for a large audience would not be required. Remote work is an effective strategy for safeguarding personnel from harm.
Remote Work Facilitates Easier Hiring of Talented Staff.
The popularity of remote work has enabled firms to find and recruit top talent with the necessary competence and personality traits that fit in with their business. This comes at a fraction of the cost considering the losses that can be incurred – up to $7,000 – when hiring the wrong candidate, which no business can afford. Small Business Trends reports that replacing the incorrect individual in a position could be up to 27 times more expensive. Despite the shortage of technical ability, recruitment managers in all sectors, especially in technology, have grappled to find the suitable personnel. Robert Half Technology Salary Guide 2023 reports that “the chronic shortage of technology personnel is no longer just an inconvenience, but is rapidly turning into a significant business problem.” Fortunately, this problem can be readily solved by hiring from a broader pool of candidates, including those in remote locations, ensuring access to a wider range of potential employees to make the best selection for the job.
Remote Work Offers Protection Against Offshoring Risks.
Before committing to outsourcing work, it is important to be aware of the potential risks associated with it. Remote work can be an excellent way of accessing overseas services without the need to set up a business abroad, or worry about political or bureaucratic problems. Despite this, businesses must be aware of the potential hidden costs of outsourcing, which could be as much as 65% higher than expected. Therefore, it is crucial to weigh the pros and cons before starting a business process outsourcing (BPO) undertaking.
Hiring Full-Time Remote Global Employees is the Best Cost-Saving Measure for Businesses.
According to a recent study by Robert Half Technology, 44% of Chief Information Officers have experienced challenges finding top talent, mainly because they are unable to offer competitive remuneration. It is worth noting that IT industry salaries are among the highest in the country and may vary significantly depending on the geographical location.
Payscale was used to determine the earnings.
Check the salaries of software developers in other countries here to compare.
The salaries were assessed using Payscale.
It is reassuring to know that the average income in the United States is one of the highest globally, as mentioned by the Organization for Economic Co-operation and Development (OECD). This points to a robust economy and offers an excellent prospect for individuals seeking to benefit from the wage difference between the US and other nations. Through the use of labor and resources located in different parts of the world, it is feasible to find skilled workers at a significantly lower cost than hiring domestically in the US.
Poland, South Korea, Italy, Spain, New Zealand, and Finland are all renowned for their superior education systems, making them an excellent option for finding potential employees.
While some may have reservations about offering employees in other regions wages that are lower than the US market rate, given its high cost of living, it is important to recognize that there are several countries with a high standard of education and a low average income, where the cost of living is substantially lower than in the US. Examples are Sweden, Canada, Germany, South Korea, Italy, and Spain. Hence, equitable remuneration for employees in these countries does not necessarily entail the same pay scale as that of the US.
It is a well-established fact that remote work is on the rise, even during periods of economic instability. Remote work offers undeniable benefits to employee contentment, long-term environmental sustainability, and cost savings for companies.
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