How London became the home of hybrid working

How many people are working from home, and how many have returned to the office? The answer to this—apparently simple—question is surprisingly complicated.

Estimates have varied—as the pandemic has waxed and waned, as government guidance and regulation has changed, and as different surveys have asked subtly different questions. As part of a new project at King's College London, Work/Place: London Returning, we have been comparing the different surveys and what their results tell us, alongside our own Wave 1 Work/Place survey of London's workers.

Although the headline figures emerging from the various surveys have varied, one feature has remained consistent throughout: London's experience has been different to the rest of the U.K.'s. The capital saw more people furloughed at the beginning of the pandemic, and has persistently had more people working from home. For example, in its 2020 round of interviews, the Office for National Statistics (ONS) Annual Population Survey (APS) found that 37% of London's workers had worked at home the previous week, compared to 26% across the U.K. In January to March 2021, the ONS Opinion and Lifestyle Survey found that up to 65% of Londoners and 46% of people across England had worked from home as a result of COVID the previous week. In late March 2022, the same survey showed that around 26% of the U.K. population worked from home, while 37% of Londoners did. Most recently, in July 2022, ONS analysis showed London had seen sharper rises in homeworking, and bigger drops in commuting from out of region, than any other English regions between late 2019 and early 2022.

Remote working has always been more prevalent in London: APS data shows that 18% of London's workers had worked from home in the week prior to interview in 2019, compared to a UK average of 12%. But why are people who live and/or work in London (the groups are similar but not the same) so much more likely to work from home, and are they likely to return to the office over time?

There are some factors that enable London's workers to work remotely and there are others that encourage them to do so. More London workers can work remotely because of the industries they work in. As our paper sets out, many more Londoners work in professional services, and information and communications roles—for example, as lawyers, accountants, consultants, TV producers, IT consultants, architects. These jobs accounted for 22% of London employment, but only 14% across England. These were also the jobs that switched online most easily: in January 2021, employers in England estimated that 44% of professional services workers and 59% of information and communications workers had been working from home in the previous two weeks.

By contrast, in sectors such as hospitality—which rely heavily on face-to-face contact and account for a similar proportion of jobs in London and across England—nearly 75% of staff were on furlough at that time. London's workforce split between the workers who took their work home, and the workers whose work vanished as commuters and tourists stayed away, which also explains why the capital had both the most resilient productivity, and the highest rises in unemployment during the pandemic compared to other English regions.

Industrial structure accounts for some but not all of the difference. The effect is compounded by occupational structure: 62% of Londoners worked management, professional or associate professional jobs in 2021, compared to 50% across England. Around 40% of people doing these jobs worked from home for at least one day the week before they were interviewed in 2020, compared to caring, skilled trade and customer service jobs, where 10% or fewer reported doing so.

These features of London's workforce help to explain why Londoners and London's workers (overlapping but distinct groups) can work from home; the Work/Place survey also sheds light on why they are choosing to do so—at least some of the time. The survey found that the costs of commuting, and the time it takes, were the leading factors behind home-working. While respondents valued the flexibility of working from home, they did not dislike their office environment—on the contrary, many valued the sociability and buzz of their London workplace—but disliked the time and expense of daily commuting.

Commuting is a big cost—in terms of time and money—for people living and working in London. Labor Force Survey data for London boroughs showed their residents commuted an average of 39 minutes each way in 2016, compared to 28 minutes for other English local authorities, and showed similarly lengthy commutes for people living in commuter districts such as Chiltern, Dartford and Elmbridge. One London PR agency has estimated that commuting can cost £8,000 or more every year, when additional childcare costs are added to season ticket costs—equivalent to 22% of the average PR salary after tax.

London workers have both the capacity and incentives to work from home, at least some of the time, and the fact that leisure visits have been recovering faster than workplace visits suggests that it is long-term changes in habits rather than short-term fear of infection that is influencing behavior. Against this backdrop, it is unsurprising that our Work/Place survey found that only a minority think that the five-day commute will return. For the moment, the preference seems to be for hybrid working, with around 45% of London workers viewing two to three days working from home as optimal. Culture and practice will shift the dial one way or another in specific organizations and industries, as would government action on the costs of commuting and childcare, but our research suggests that the impact of the pandemic on London's work patterns has been significant and will be long-lasting.