While many workers have returned to the office, plenty more continue to work remotely or within a hybrid arrangement. But what’s the cost difference between working from home or doing a daily commute to the office? It may be higher than you think.
$863 in Monthly Expenses
According to a survey by video conferencing solutions company Owl Labs, employees working remotely spend around $423 per month on work-related expenses, whereas office workers spend around $863. In other words, the expenses of working in an office are nearly double what you’d spend when working remotely—adding up to a difference of $5,280 over the year.
Why are office workers spending thousands of dollars more per year than remote employees? The top expenses of in-office work include transportation costs, meals out, and pet care.
Daily Expenses That Add Up
The Owl Labs survey found that everyday, on average, in-office workers spend around $15 for commuting costs, $14.25 for lunch, just over $10 for dinner, and around $8.50 for breakfast and coffee. For employees with furry friends at home, the cost of pet care comes out to approximately $16 per day.
Because remote workers tend to make meals at home and enjoy a commute of just a few steps, their daily costs are considerably lower. Still, some remote workers may face work-from-home expenses like the upfront investment in office equipment, a higher internet bandwidth, and home-buying decisions based on needing the extra office space.
Variability in Costs
Of course, the actual costs of working in an office or working remotely will vary widely depending on your commute, lifestyle and spending habits. Office workers who bring meals and coffee to work will see far less impact on their bank account, whereas workers with a long commute by car will be particularly affected by rising gas prices.
Another factor contributing to cost variability is the presence of hybrid work options. In the Owl Labs survey, which queried over 2,300 full-time employees, around one third of workers said they followed a hybrid model. The global analytics firm Gallup estimates that 53% of people in the U.S. with a remote-capable job are in a hybrid arrangement. While hybrid arrangements may offer employees the best of both worlds, they can also make it harder to predict monthly expenses.
What Workers Prefer
A Deloitte survey found that 75% of millennials and Gen Z prefer hybrid or remote work over full-time commuting, citing cost savings as a major benefit. Some survey respondents said they are also taking advantage of remote work to move to less expensive cities, or cheaper neighborhoods in their current location. At the same time, workers do say that remote work makes it more difficult to connect with colleagues and find mentors.
Implications for Compensation
Given the increased expenses employees face when working from an office, employees may have a strong case to negotiate higher salaries if their job requires in-office attendance. According to the Deloitte survey, some employees are also making the case that more flexibility at work creates more opportunity for women or other workers in a caretaking role.
As businesses and workers continue to rebuild the future of work, the only certainty is that working styles will continue to evolve.