WFH saves $110 a week, $5k a year, says CEDA 

A new report from the Committee for Economic Development of Australia (CEDA) has touched on the cost-saving benefits that working from home can offer employees.

CEDA analysis has found that since the COVID-19 pandemic, Aussies who have had the opportunity to work from home saved an estimated $5,308 – based on average wages – by cutting their commuting time by three hours a week.

The analysis of recent data from the Household Income and Labour Dynamics survey found that workers commuted on average 15.7 per cent less than if they worked in an office.

This comes amid a contentious debate around WFH after it was dragged into the political spotlight by Coalition party leader Peter Dutton, who proposed to recall all public sector workers back into the office five days a week.

“This confirms what many Australians have experienced since the pandemic – workers are saving time and money on their commute and, in many cases, are also able to work more hours or even get a job, where they couldn’t do so before,” said CEDA economist James Brooks.

The cost savings that WFH affords have regularly been featured throughout flexible working discourse – especially considering the financial pressures that many Australians are under. These savings are often derived from the lack of commuting to and from work, with the average daily cost for an Aussie to get to their workplace and then back home being $20.

“Commuting less brings savings on public transport fares and fuel costs, but there’s also savings on time,” said Brooks.

“We value that at $110 per week or $5,308 for a 48-week working year, using the average hourly wage of Australians who work from home.”

“This is 21 per cent higher than the approximately $4,400 we have previously found Australians are foregoing in wages by working from home. In other words, what they might be losing in wages, they are gaining in reduced commute time.”

On top of that, employees of WFH were able to work nearly 20 per cent more hours than their office-based colleagues.

“This can be due to a range of factors such as being able to add an extra day of work, using the time gained to get more work done, cost-of-living pressures and the strong labour market,” said Brooks.

With increases in childcare costs potentially on the horizon, the case of needed flexibility for parents of young workers has never been higher – especially when one considers the increased participation of mothers in the workforce through WFH access.

“This analysis confirms that mothers of a child aged under four and those with impactful health conditions are now more likely to have a job. This suggests groups that had previously faced barriers to onsite work are more likely to have a job now because they can work from home,” added Brooks.

In terms of who continues to work from home despite the recalls to the office, the data showed that 60 per cent of managers and professionals were sticking to a WFH routine.

“Five years on from the pandemic, more than one-third [of] Australians still regularly work from home, including approximately 60 per cent of professionals and managers,” said Brooks.

Brooks argued that due to the various gains made socially and economically from WFH, negating it as an option would be counterproductive – proposing increases to these arrangements instead.

“Given the broad economic and social benefits of the working-from-home shift, we should look to maintain these gains, even as the labour market softens,” said Brooks.