Many proclaimed remote work is here to stay. They couldn't be more wrong as big firms increasingly take a hardline stance

The timing of recent announcements by companies saying employees must return to the office reflects one possible factor for the trend: When one high-profile business leader makes an unpopular move first, it provides a cover of sorts for others to follow suit, experts say.

Grab’s sudden announcement on Oct 24 that it will be reversing its three-year hybrid work policy and requiring employees to return to office full-time may have caught some people off-guard. But for at least one employee, the writing had been on the wall for some time.

The 30-something employee, who wanted to be known only as Ms Sam, said that since the middle of last year, the tech company started asking staff to return to the office more frequently – thrice a week instead of twice.

Then, at the start of this year, Grab declared it would take “disciplinary action” against those who were non-compliant, she said.

“I had a feeling (full return-to-office) would happen, especially with how Amazon and other tech companies are moving,” Ms Sam told CNA TODAY, referring to the American tech giant's announcement in September mandating working in the office five days a week.

Amazon CEO Andy Jassy said in September that by being in office it was "easier to strengthen our culture" and collaboration is made "simpler and more effective". Mr Matt Garman, CEO of Amazon Web Services, later said that the new policy had received broad support from workers.

Amazon’s U-turn on remote and hybrid work – as well as its comply-or-leave ultimatum – was met with strong resistance: This week more than 500 of its employees wrote to Mr Garman urging a reversal of the decision.

The letter described the management's explanation for the return-to-office mandate as “non-data-driven” and referred to Mr Garman’s own past comments, when he said the company was running effectively while fully remote.

Other big-name employers globally have also taken a strong public stance on employees' physical attendance at the workplace, reversing the remote work trend that many had lauded as the new norm after the COVID-19 pandemic.

Disney at the begining of 2023 mandated a return to office for four days a week. In April the same year, JP Morgan asked all its managing directors to return to office every weekday, and other employees thrice a week.

In justifying the move, Disney CEO Bob Iger said nothing could replace the ability to connect and co-create when the team is physically together, while JP Morgan Chase Chairman and CEO Jamie Dimon said remote work hinders "spontaneous idea generation".

And before them, Elon Musk back in 2022 ordered Tesla and X (at the time still called Twitter) employees to clock in 40 hours in office a week or leave, saying that the creation of great products cannot happen with workers "phoning in".

Most recently, it was reported this week that Starbucks recently announced a stricter enforcement of its three-days-in-office policy. From January, employees who do not comply risk losing their jobs.

This slew of “back-to-office” mandates comes as a CEO Outlook 2024 Report by professional services firm KPMG published in September found that CEOs are hardening their stance on returning to pre-pandemic ways of working, with 83 per cent of business leaders globally expecting a full return to the office within the next three years.

Ms Nicki Doble, principal adviser for corporate transformation, advisory, from professional KPMG in Singapore, said: “We have also seen many employers setting specific benchmarks for the number of days that employees are required to be in office.”

This back-to-office fever seems to have reached Singapore’s shores, too, with companies recently asking their employees to work in the office more frequently, if not every day.

Data from the Ministry of Manpower (MOM) also shows a steady decline in the proportion of companies here offering a scheduled teleworking arrangement – from 56.5 per cent in 2021 to 31.9 per cent last year.

Scheduled teleworking refers to an arrangement where employees are allowed to work remotely for an agreed period of time. Companies that do not offer scheduled teleworking arrangements could offer it on an ad-hoc basis or not at all, but no breakdown of such data is available.

The number of job vacancies that offer remote work here has also declined, from 35 per cent in 2020 to 21 per cent in 2022, according to MOM's latest figures.

All these developments come as recent research offers a mixed picture of how relatively productive work-from-home is compared with traditional working on-site, with some studies noting a tangible drop in productivity when employees work remotely full-time.

And while many companies alluded to productivity as a factor when bringing their workers back to the office, human resource and labour experts told CNA TODAY that there may be other explanations for the trend.

The timing of the recent spate of announcements points to one factor: When one high-profile company or business leader makes an unpopular move first, it provides a cover of sorts for others to follow suit.

Labour economist from the Singapore University of Social Sciences (SUSS) Walter Theseira said: “Nobody wants to be the first but when there is a wave of companies doing this actually, then that's when you see employers put into place what they wanted to do all along.”

It seems contradictory when Singapore has been taking steps to encourage greater acceptance of flexible work arrangements, with the MOM introducing mandatory guidelines that will take effect in December.

With work-from-home increasingly viewed by employers as an arrangement that has outlived its purpose, what will these recent developments mean for the future of other flexible work arrangements in Singapore?

WAS THE SUCCESS OF REMOTE WORK OVERHYPED?

While a growing number of bosses are taking a tougher stance on employees being physically present in the office, many workers are still unconvinced about the need to do so.

Multiple surveys indicate that the majority of workers around the world still prefer to work some days at home.

For example, a poll by a US human resource solutions firm Bamboo HR, published in June, found that 42 per cent of American employees who returned to the office say they feel like they are showing up just for visibility.

Similarly, a poll done by workplace design and planning firm Unispace found that being perceived as less committed to the job is the top concern about working remotely among employees in Singapore. As many as 36 per cent of employees here expressed this concern, higher than the 31 per cent global average.

Meanwhile, a survey of workers and job seekers in Singapore done by human resource solution agency Randstad in late 2023 found that half the respondents said they would leave jobs that require them to work in office more frequently.

And it seems that Singapore workers have stronger feelings about remote working compared with their global counterparts, according to a separate study in 2024 by human resource consultancy Mercer:

• 75 per cent of respondents in Singapore say they feel less stress when working remotely, compared with 69 per cent globally
• 58 per cent of Singapore-based respondents prefer to work remotely at least half the time, compared with 47 per cent globally

Several employees who were reluctant to return to office full-time told CNA TODAY that they did not feel less productive when working from home.

An employee at a multinational cybersecurity firm, who wanted to be known only by her initials TR, said that she and her colleagues feel they are able to do more work at home.

“In the office, it's often noisier. People come by your desk to ask you questions, which is very distracting. It's troublesome having to look for available meeting rooms or phone booths, and you have to waste time commuting back and forth every day,” said Ms TR, who is in her 30s.

Ever since her company strictly enforced a four-day work-from-office regime early last year, motivation among employees has dropped and some of her colleagues have even left, she added.

While productivity and remote working may go hand in hand for employees like Ms TR, some research suggests otherwise.

For instance, Forbes reported in August 2023 a 10 per cent to 20 per cent decrease in productivity for fully remote workers, citing a working paper by Stanford Institute for Economic Policy Research, whose findings were not peer-reviewed.

Another paper by the University of Chicago in 2023, based on an analysis of 10,000 skilled professionals in a technology company, reported that productivity fell between 8 per cent and 19 per cent among remote workers.

Locally, an analysis by the Monetary Authority of Singapore (MAS), published in its October 2023 macroeconomic review, found there was an increase in employees' output. This is as the workers saved time from not having to commute and channeled these savings to work.

The analysis noted that there was not enough data to assess the productivity benefits of hybrid work arrangements, which may differ from pure remote work.

And while hybrid working – which combines remote work with in-office work – has been touted as offering the best of both worlds, it also comes with its own set of challenges, according to professional networking platform LinkedIn.

“Our latest survey reveals that over one-third of professionals in Singapore are struggling to communicate efficiently in hybrid work environments,” said Ms Feon Ang, managing director for LinkedIn APAC.

In the meantime, co-working spaces have evolved their offerings as demand for office space increases. JustCo, for example, saw a 19 per cent increase in enquiries – from both individuals and companies – between January and October this year as compared with the same period in 2023.

"While companies in Singapore are increasingly asking employees to return to office, there will likely still be an uptick in demand for flexible workspaces," said a spokesperson. 

Catering to this trend, the firm launched JustCo SuperPass in June last year, a cost-saving plan that allows companies to grant office access to additional employees on an ad-hoc basis without paying for long-term workstations.  

The seemingly short-lived enthusiasm for remote working among employers comes at a notable juncture in Singapore, as the government is making strides to encourage flexible work arrangements amid perennial concerns about the nation’s tight labour market, ageing workforce and the fact that more workers are taking on caregiving roles at home.

In April, MOM announced that all employers must have a process in place for workers to make formal requests for flexible work arrangements from December, when new tripartite guidelines come into effect.

While employers have the right to reject such requests, the decision should be backed up by reasonable business grounds such as cost or productivity considerations, the ministry said.

WHY THE SUDDEN CHANGE?

Given how many companies said during the pandemic that their remote working arrangements were not affecting productivity, the recent and sudden about-turn by a series of big employers raises one big question: Why now? 

From cost considerations to reducing headcount to promoting staff integration, these are some of the reasons cited by human resource and business experts as well as companies themselves for doing away with remote working in the past year or so:

• Value of human interaction

Both Amazon and Grab, in announcing their return-to-office mandates, said in-person collaboration, as observed during hybrid work arrangements, had been beneficial for the company.

And so, to further enhance this, the companies decided to double down on the number of days in office.

Group CEO of recruitment firm Reeracoen, Kenji Naito, noted: “For some roles, particularly where immediate responses are required or tasks aren’t easily measured, working from the office facilitates more streamlined communication.”

Such interaction is even more important for small and young companies.

Mr Bryan Tay, Singapore country manager for fintech platform Lendela, said: “We need to create a culture from scratch and cultivate trust, understanding, and a deep belief in our mission, which is much harder to do over a screen.”

Lendela was founded in 2018 and currently has over 50 employees in Singapore and other markets. Since its founding, it has practised full-time work from the office, except during the Covid-19 pandemic.

“Being together in the office allows us to build stronger connections, share ideas organically, engage in real-time problem-solving, and respond quickly to opportunities and challenges,” said Mr Tay.

• Integrating post-pandemic hires

It is normal for companies to constantly review their policies and strategies from time to time, including those relating to employee location, said experts.

Economist Song Seng Wun said that companies would have had hired workers during or soon after the pandemic.

With the growing number of employees who have not had a chance to meet each other in person regularly, it may be an added impetus for some companies now to call them back into the office.

“Workers come and go. Ultimately companies don’t want a situation where their employees are working with people they have never or hardly met,” said Mr Song, economic adviser for financial service provider CGS International.

Mr Naito of Reeracoen added: “We've observed that junior employees with less experience and employees without clearly defined quantitative targets may face challenges working remotely.

“Junior employees often require more direct supervision and mentorship, which can be limited in remote settings.”

• Cutting headcount and justifying costs

One often-heard argument for maintaining flexible working arrangements is that a company that fails to do so risks losing good employees.

“However, some companies might see this as an opportunity to streamline their workforce, which could align with their goals of optimising headcount,” said Mr Lewis Garrad, partner and career business leader for Mercer Asia.

Interestingly, some of the companies calling their workers back to office, such as Grab, Disney and Amazon, are also those that have recently made headlines for retrenchment exercises.

Indeed, one of Amazon’s top executives reportedly told employees that if they had problems complying with the mandatory return to office policy, “there are other companies around”.

Bamboo HR’s survey in June found that a quarter of vice-presidents and C-suite executives and 18 per cent of HR professionals surveyed in the US admitted hoping for “some voluntary turnover” when they implemented mandatory return-to-office policies.

But experts also noted that a forced return to office policy may be too blunt a tool to trim headcount.

Assoc Prof Theseira said some companies may see it as "not necessarily a bad thing" to lose employees who are unwilling to return to office and whom they perceive as less committed.

"But there is this argument that they might be losing their best staff, because their best staff have the ability to quit and then find a job elsewhere," he said.

Experts added that many other factors influence a company’s decision to mandate a return to office.

While some argue that enforcing office-based work would drive away talent, Lendela told CNA TODAY that its retention rate this year so far is 88 per cent across all its offices, and 87.5 per cent for the Singapore office.

By comparison, a poll by market research firm IPSOS  in January found about three in 10 workers in Singapore intend to leave their employers within two years. A separate study by professional services firm EY in July 2023 found 45 per cent of workers here had plans to change jobs within a year.

In Lendela's latest monthly employee satisfaction survey – done anonymously and online – its workers gave an average rating of 86 per cent in terms of happiness.

Meanwhile over at another startup BigFundr, which also stopped practising remote work after the COVID-19 period, one employee, Mr Imran Johri, found work-from-office a refreshing change from the purely remote arrangement in his old company.

“Those work-from-home years were the most challenging for me (in terms of productivity) as I have three young children who simply see my presence as the licence for constant engagement,” said Mr Imran, who is marketing director at BigFundr.

Nonetheless, he admitted that a hybrid arrangement would be ideal, as it would allow him to meet his caregiving responsibilities for his children and family too.

Some experts highlighted the high real estate costs here as an additional motivation for companies to bring their workers back to the office to “justify” their spending on rents.

“The high cost of office space in Singapore means companies with large offices may feel the need to bring employees back to fully use their space,” said Mr Jianhan Qiu, principal for strategy, Asia, at Unispace Singapore.

“The cost of keeping empty offices can push businesses to focus on in-office work, making it a financial decision as well as a cultural one.”

• Taking the cue from other (bigger) companies

While companies make their own calculations in setting any policy or strategy, it is also normal for them to take a look at what others in the industry are doing and take that into consideration.

Ms Shalynn Ler, Singapore general manager for recruitment firm Ethos BeathChapman, noted that companies are operating under great economic uncertainty and face huge pressures from shareholders.

“It is easy in such circumstances to be very reactive and herd mentality sets in, where companies start to mirror what other big firms and industry leaders are doing,” she said.

Assoc Prof Theseira of SUSS said that it “seems true anecdotally” that if a certain big company does something, then a smaller one would tend to follow suit as well.

It also applies to measures that are seen as unpopular but otherwise financially necessary – such as retrenching workers, raising prices of products, or even changing work practices.

“The natural tendency of management globally is always to do it, because they are looking after the bottom line. But it's just that the company may not want to do this (yet), if they are going to be the first,” said Assoc Prof Theseira.

• Economic conditions

Ms Ang from LinkedIn noted that businesses globally are “facing headwinds and rapid change”, prompting companies to reconsider a whole range of decisions, from investments to operations.

Though the latest MOM figures indicate that although the labour market in Singapore is tight – the unemployment rate is low and there is a scarcity of workers to fill roles – sentiment has been bleak.

Retrenchments more than doubled in 2023 from the year before. Earlier this year, the Singapore National Employers Federation and the labour movement said they were expecting more layoffs until the end of 2024.

Furthermore, as more organisations adopt work-from-office as the default arrangement, even if there are more jobs available, employees seeking flexible options may have fewer choices, according to some experts.

“This trend could potentially decrease the bargaining power of workers who prefer remote or hybrid models,” said Mr David Blasco, country director at Randstad Singapore.

Simply put, companies which want to revoke work-from-home benefits may have to worry less about their employees leaving.

Ms Sam from Grab said that her salary lags behind her peers, but the flexible work arrangement has “somewhat made up for it – or at least delayed my departure”.

She intends to leave, but it may not be so straightforward now.

“And I think the company knows this as well, the job market isn’t that great. So maybe many of us won’t be able to find better options anyway,” she said.

THE FUTURE OF FLEXI-WORK

As much as the launch of flexi-work guidelines by MOM seems a step in the right direction, experts pointed out that companies can quite easily reject employees' requests for these arrangements with simple and general justifications, such as by saying that they need all workers to work in the office full-time due to operational reasons.

“There is an overarching concern that the framework's reliance on employer goodwill and competitive pressure, rather than strict enforcement, could limit its impact,” said Mr Blasco of Randstad.

In response to queries after the guidelines were announced, MOM said that errant companies would be counselled and be given warnings if they do not consider their employees’ flexi-work requests fairly.

Mr Blasco said what may be a bigger deterrent to companies considering a full turnabout from remote or hybrid work arrangements is the potential reputational cost.

“Ultimately, the organisation's policies will significantly shape its culture and long-term reputation," he said.

He added that given how any negative perception of a company can be “particularly stubborn to change”, it would benefit the companies to really think through their workplace policies before implementing them.

Some companies currently operating in the office full-time, like the startup BigFundr, are well aware of this.

“It is with that in mind that we are now looking into our version of a more flexible work arrangement,” said its founder and CEO Quah Kay Beng.

He added that they are “keen to allow for (flexi-work) to be part of our work culture” as soon as the company of 14 employees grows in size and efficiency.

Experts also generally agreed that even as some companies require their employees to return to office, it does not mean the end of flexible work arrangements.

“The initial enthusiasm for 100 per cent remote work may evolve into more nuanced approaches to flexible work that are better suited to each company’s operational needs,” said Mr Naito of Reeracoen.

Ms Ler of Ethos BeathChapman said in the long term, the future of flexi-work arrangements in Singapore would also be influenced by the norms of the bigger economic markets such as the United States, United Kingdom and China.

“If it becomes more common in those bigger economies globally for employers to revert to offer-based work policy, for instance, Singapore will likely follow suit,” she added.

Furthermore, if Singapore excels in flexible-work arrangements, it could serve as a competitive advantage for the nation.

The experts noted that the MOM guidelines, though not legally binding, signals that the government recognises the importance of flexi-work arrangements. Thus, it is unlikely that such arrangements will disappear entirely in the future.

And even if companies believe they can afford to scale back on certain flexible work arrangements now, they are likely to reevaluate their position once the job market cycle shifts and becomes more of an employee's market again, and they face challenges in attracting talent in the future, experts said.

The economists also noted that the labour market is cyclical – it may favour employers for a period of time, but will return to being an employees' market when talents become scarce and companies have to compete with each other for headcount.

“It wouldn't be surprising if at some point in the future, you have one market player doing this big, flashy (flexi-work) thing and say: 'We offer all this hybrid work and so on, as an attempt to recruit people’,” said Assoc Prof Theseira.

Sign up for our newsletters

Get our pick of top stories and thought-provoking articles in your inbox

Subscribe here

Get the CNA app

Stay updated with notifications for breaking news and our best stories

Download here

Get WhatsApp alerts

Join our channel for the top reads for the day on your preferred chat app

Join here