The economics of working from home – a proletariat perspective

Over the weekend my buddy and I were chatting about the impacts of working from home and thought I should look at it a little more deeply and paint it from my perspective. Obviously more and more companies are buying in to the “Work @ Home” concept to essentially cut costs and get more productivity.

I started working from home more often than not over the last 6 months when I don’t travel and it has been a revelation. For many years I believed that the notion of working at home was one of the biggest scams perpetuated by the proletariat in corporate America. So much so that I discouraged my team from working from home and those that had to on occasion, I tolerated with a lot of effort. All this has changed for me now that I seem to have begun to enjoy working at home and believe I have become a lot more productive. That said I do want to look at it broadly and objectively from an employee perspective and see what’s in it, if at all for us.

Lets start by looking at the tangible aspects of working from home. At a minimum, the costs of going to a work place every day of the week; Monday to Friday is;

Lunch	$ 40.00
Transportation (Gas, Tolls, Parking, Metro)	$ 50.00
Dry Cleaning/Laundry	$ 10.00
Total	$100.00

Now I am sure different folks have different spending pattern’s such as Starbucks, cigarettes etc etc but this to me captures the basics of a weeks expenditures.

Calculating the costs of working from home, I come up with the following;

Incremental Electricity	$ 15.00
Incremental Heating/Cooling	$ 15.00
Lunch	$ 20.00
Total	$ 50.00

So clearly the cost of working from home is half that of working from home.

Lets look at the intangibles of working from home as often these could lead us one way or the other;

Upsides -

1. More time to exercise
   
2. More time to spend with the kids and families
   
3. Less pollution of the environment
   
4. Less stress of driving through rush hour traffic
5. Getting to eat more healthy since you have control of what's in your pantry
   
6. Lesser work politics….so I hope :~)

Downsides -

1. If there is a non-working spouse at home with kids…forget it
2. No excuse to not exercise
3. Potential to oversleep in; i.e. waking 2 mins before a meeting and pretending to be tired due to being overworked
4. Lower propensity to make friends at the work place

Now some of the pre-requisites for working from home in my opinion are;

• Tremendous discipline to getting your work done; forget about trying to work on your couch or in your pajama’s….wont work long term.
  
• Your work ethic has to be crisp and above any level of debate.
  
• Differentiate work time from home time.

If you can not manage that, working from home is not something you should be attempting since you will get in to trouble….guaranteed!

So what next you ask? My foggy crystal indicates that;

• More and more people will start working from home at the pleasure of their employers. One of those few win wins for employee and employers. It will never be 100% since some people are more productive in a business environment; they require the daily live/non phone interactions with their colleagues or require more supervision.
• Work at home in the right context will work for all levels of people up and down the corporate ladder.
• There will be new legal issues that will be dealt with, for instance, if I trip and fall @ home while working, who is liable?
• With more and more work from home scenario’s and a growing imbalance of businesses to real estate ratio’s we are definitely on the cusp of a commercial real estate bubble ready to pop.

So those of you who work from home….I am happy to be part of this new virtual neighborhood…lets catch up for coffee sometime :~)