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Telework could save government $14B

Dec. 19, 2013 - 06:00AM   |  
By MICHAEL HARDY   |   Comments
Telework allows greater freedom for employees, leading to increased productivity in many cases, advocates argue.
Telework allows greater freedom for employees, leading to increased productivity in many cases, advocates argue. (David Sacks / Getty Images)

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The government itself is not consistently measuring the returns on its telework investments, but a consulting firm estimates that remote work arrangements could save taxpayers almost $14 billion a year, if effectively implemented.

The report from Global Workplace Analytics is based on conservative assumptions and data from 2011, meaning the impact today could be even greater, the authors argue.

The Telework Enhancement Act of 2010 did not require agencies to measure the effects of telework programs, but the Government Accountability Office has nevertheless criticized the Office of Personnel Management for not collecting data from agencies.

The paper was co-authored by Kate Lister, president of GWA, and Tom Harnish, senior scientist for the Telework Research Network, GWA’s research arm. It suggests a model for quantifying the effect of telework on agency costs. The authors calculated three parallel tracks:

Existing Teleworkers: The number of federal employees actually teleworking in 2011 and conservative savings assumptions.

Potential Telework, Low Case: The number of federal employees eligible to telework in 2011 and the same set of assumptions.

Potential Telework, Benchmark Case: The number of federal employees eligible to telework in 2011 and a broader set of assumptions drawn partly from actual results in private- and public-sector organizations.

The ROI under the “existing teleworkers” scenario would be about $1.8 billion. If all federal employees eligible for telework took advantage of that, the savings could rise to $10.4 billion under conservative assumptions, or $13.9 billion under the benchmark estimate. The savings come from several factors that influence cost, the authors say. Among them: Real estate, productivity, turnover, absenteeism, continuity of operations, transit and health care.

Real Estate

Organizations typically use only 35 percent to 50 percent of the office space they own, according to the report. Telework is part of the reason, and could become even more of an influence. Meanwhile, agencies and companies are rethinking the space they do use, trying to encourage collaboration when people are in the office. The changing work patterns allow organization to support less space with no loss of effectiveness. Strategies that combine telework with desk sharing and hoteling, among other strategies, can provide the organization the best of both worlds.

The General Services Administration, for example, supports 4,000 employees in a space originally designed for half that number. Another example cited in the study comes from Deloitte LLP, which reduced its office space and utility bills by 30 percent when it liberalized its telework policy for its 45,000 employees.

Productivity

Managers resist telework in many cases because of fear that employees who are not under direct supervision will slack. In fact, the opposite is true. For a variety of reasons, such as fewer interruptions, productivity often increases when employees telework. The study cites examples from several organizations, including the Air Force’s Central Adjudication Facility, which saw a 55 percent rise in productivity during the first year of its telework program.

Absenteeism

Employees take time out of work for many reasons. They get sick, often due to exposure to ill co-workers. They need to handle personal appointments and errands. They become stressed out and take a “mental health day.” Telework mitigates these and other concerns, the authors argue.

Turnover

While turnover is lower in the government than in the private sector, it is still a significant source of costs. With many feds over the age of 45, retirements will have an effect over the coming years. Many young Americans beginning their careers expect flexible work arrangements including the ability to work from home, so the government is making its recruiting case harder by not embracing the practice, the authors say.

Job satisfaction is consistently higher among employees who telework than among those who don’t, in the government and private sector alike, they report. The most recent Federal Employee Viewpoint Survey showed an 11 percent gap between teleworkers and non-teleworkers in engagement and satisfaction, they said.

Individual agencies may see more or less in savings depending on how far along they already are in providing tools to make telework possible, and other factors. Global Workplace Analytics provides a free calculator to help agency managers figure out their particular parameters.

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