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How the Option to Work from Home Impacts Employee Retention

A few years ago, working from home sounded like a luxury only experienced by a minority of businesses. In 2018, just 5.7% of the American workforce was remote, whereas today nearly 27% work at home full-time and 92% spend at least one day a week working remotely, according to Zippia. And now, the option to work from home can be the difference between keeping or losing staff.

“We are never going back to what we used to call normal and there is good reason for that,” said Mark Babbitt, speaker and co-author of Good Comes First, in a recent episode of Extra Credit, NACM’s new podcast. “Because to be honest, the old normal for many people sucked, and 56 million people in the last 15 months made it clear the old normal sucked for them as well because they voluntarily left their jobs. So, as leaders you can’t go back to an old workplace. You have to create something new.”

But not all companies are equipped to allow employees to work from home, and some feel that productivity and cooperation is lost through remote work. “The company mentality is they want people to collaborate and be in the office,” said Seena Urquhart, credit manager at Vicor Corporation (Andover, MA). “Also, the position we are trying to fill was not really made for working from home because a lot of paper is involved and you receive tasks from all different departments.”

However, Urquhart said not having a remote work option has shrunk the pool of candidates. “If we become more automated then one day working from home may be an option,” she explained. “I think after COVID people are looking for more of a work-life balance and companies have to be more attuned to that. The new generation is just looking for different things than what we have offered in the past, and as a company we need to look forward.”

Urquhart is not alone. According to a recent eNews poll, 67% of credit departments have lost staff to other companies due to the ability to work from home. For some businesses that have allowed staff to stay either fully or partially remote, the story is different.

“Our turnover has been a lot lower in the credit and collections area than the rest of our company, which has been great,” said Bob Moulton, director of customer financial services at Covetrus, Inc (Dublin, OH). “During the pandemic, our company started hiring people regardless of location; [we are] more focused on finding the right candidate.”

While several businesses have started calling employees back into the office as the pandemic winds down, Moulton is hesitant to do so. “I think we have not yet had trouble retaining folks because secretly they wanted to work from home; and now, they are,” he explained. “And with the inflation we are experiencing, if we all of a sudden were to tell them they need to come to the office again, it becomes an expensive endeavor to drive to work every day. That would definitely lead to turnover because they know there are other remote opportunities. But as long as we are providing that opportunity and paying a competitive wage, I am hoping we can keep our turnover at the lows we have been experiencing because I know it is unusual.”

This article first appeared in the June 9 issue of eNews. It is reprinted with permission.

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