remote job consultationWe are offering free consultations on how to lead & manage remote teams during the COVID-19 crisis. Learn More

How Remote Workers Save Companies Money

According to a study by, work from home jobs —not including self-employed individuals—have risen some 115 percent since 2005. Even more impressive, this is nearly 10 times the growth rate of the rest of the US workforce.

The same study showed that at least half of the US workforce currently holds jobs that are at least partially compatible with telecommuting, while approximately 80 to 90 percent of employees would like to telecommute at least part time.

While telecommuting is obviously popular with employees, many managers and executives evaluating remote work options are naturally concerned about the potential impact on the company’s bottom line. While there have been many reports and studies showing that remote workers can save companies money, there are other ways in which remote positions can save money that are often missed.


Real Estate

In many parts of the country, the rising cost of real estate is a growing concern. Even regions with higher-than-average median incomes—such as Silicon Valley and Redmond, WA—are experiencing the pressures of rising real estate. Ultimately, this affects companies as well as employees and represents a significant opportunity for employers to save money.

According to one report, businesses save as much as $10,000 in real estate costs per year per remote employee.


Job Turnover

Another area where remote working can result in significant cost savings is the expense of training employees. According to the Center for American Progress, employee turnover represents an often overlooked, yet significant, expense.

After comparing 30 case studies from 11 research papers, the Center concluded that the cost of replacing a worker is, on average, approximately one-fifth of that worker’s annual salary. For highly skilled labor, the turnover cost is disproportionately higher, with some positions costing as much as 213 percent of the individual’s gross annual income.

While job turnover is obviously a major concern, the direct correlation to remote work may not be immediately obvious. However, a study by Stanford University showed that employees who worked from home reported greater job satisfaction. Even more telling, as a result of the increased job satisfaction, companies experienced significantly less turnover among remote workers, avoiding the costly process of training new personnel.

In fact, according to, 95 percent of companies polled reported that telework had a high impact on employee retention, while two-thirds of employees said they would take another job if it would help ease their commute. As a result, companies with a healthy work-from-home policy in place not only reap savings from reduced turnover but also have greater chances of attracting top talent.


Unscheduled Absences

According to the above study by, it's estimated that unscheduled absences cost employers an average of $1,800 per employee per year or an estimated $300 billion a year for US companies.

This is another area where telecommuters represent significant savings, as companies with a telework program saw a 63 percent drop in unscheduled absences. Just as important, employees are often able to return to work faster following medical issues and can handle many things—such as doctor appointments—without taking an entire day off of work. When employees are sick, working from home helps keep them from infecting others and causing large portions of the company's workforce going absent on sick leave.


Larger—Potentially Less Expensive—Talent Pool

Another way in which remote workers can save companies significant amounts of money is by opening the door to a much wider talent pool. For example, the median income for a software developer in Silicon Valley is $112,000 a year. In contrast, the median salary for a software developer in Seattle is $100,000, while in Portland a developer can expect to make $79,700 and $75,600 in Denver. Moving farther East, the median salary drops to a mere $65,737 in Sioux Falls, SD. Go even farther east—across the pond to Europe—and the median salary for developers in Russia, Ukraine or Romania drops to $15,000 to $20,000.

For companies looking for ways to save money, a 59 percent savings is substantial, opening the door to having a larger, more diverse team with a much wider array of skills for the same price.


Better Service With Less Overtime

In addition to improved diversity among the company's talent pool, hiring telecommuters opens the door for companies to offer their customers better service with less cost.

For example, if a company on the East Coast hires employees on the West Coast, they can offer telephone support for an additional three hours a day–for a full 12-hour day—without paying overtime. This has the benefit of not only decreasing cost but improving the customer service and support experience.


Improved Efficiency

Not to be ignored is the direct boost to productivity and efficiency that often goes hand-in-hand with remote workers. CoSo Cloud conducted a Remote Collaborative Worker Survey to study the impacts of remote work on both employees and employers. The study showed that of those employees who worked remotely at least part time, 77 percent reported greater productivity with 30 percent of participants accomplishing more in less time.

At the end of the study, CoSo CEO Michael Fitzpatrick concluded that “there are significant benefits to be gained by both remote workers and their employers with off-site employees motivated to work harder and more efficiently to protect both the personal and professional benefits of working remotely. Even the personal benefits workers experience can be viewed as employer benefits since workers tend to be happier, less stressed out, and healthier, thereby bringing down the costs of turnover, absenteeism, lower productivity, and other issues.”

Remote Workers and Your Company

The evidence is clear: remote workers represent significant savings through lowered cost, increased productivity and higher job satisfaction. If your company is interested in reaping the benefits of a telecommuting program, contact DistantJob for more training and information.

Share this post

Share on facebook
Share on google
Share on twitter
Share on linkedin
Share on pinterest
Share on print
Share on email

or... Subscribe to our newsletter and get exclusive content and bloopers

Matt Milano

Matt Milano

Matt Milano is a freelance writer who works with DistantJob to research and synthesise the best remote work related content into practical, accurate and actionable guides and articles on how to improve remote leadership and better manage your teams.

Don’t miss out!

Subscribe to our newsletter now and receive our latest eBook “Agile in Remote Teams” for free.