Companies Compete Over Flexibility, Now Offering Competitive Paychecks to Workers Opting for a Five-Day Workweek

By Moon Harper

Apr 08, 2024 06:55 AM EDT

The return-to-office mandates incur substantial expenses, and individuals willing to transition from remote to full-time office work may experience notable changes in their paychecks.

In-Office Attendance on The Rise

According to ZipRecruiter data shared with CNBC Make It, full-time in-office attendance salaries are on the rise in the United States. Companies now offer an average of $82,037, marking a nearly 40% increase from the $59,085 average salary offered in 2023.

According to ZipRecruiter, hybrid roles pay an average of $59,992 as of March, compared to $54,034 in 2023. Similarly, remote jobs now offer an average salary of $75,327, up from $69,107 in 2023, according to data based on job listings from ZipRecruiter's platform and survey responses from over 1,500 U.S. adults who began new jobs in 2023.

Wage Increases for In-Person Positions

Johnny Bui, aged 25, who made a career move in October 2023, left his remote consulting job for a hybrid position at the same level as a product analyst at Visa's Austin, Texas, office. Now earning 33% more, Bui expressed satisfaction with the decision, saying he was willing to sacrifice the option of working from home full-time in exchange for a higher salary.

Given the competitiveness of the job market in recent months, particularly for remote positions, Bui views it as a fair trade-off. Believing that many individuals have become accustomed to remote work since the onset of the pandemic, making it challenging to break the habit, Bui also recognizes that financial motivation plays a significant role for many people, so offering higher pay serves as an intelligent incentive to encourage a return to the office, thereby sweetening the deal.

Although fewer employers offer remote work opportunities, interest in such roles remains high. Recent research from LinkedIn indicates that while remote job postings account for less than 10% of all job listings in the U.S., they receive nearly half (46%) of all job applications. As companies increasingly enforce their return-to-office mandates, wage increases for in-person positions are being observed.

Stricter Guardrails on In-Office Mandates

90% of companies intend to implement a return-to-office policy by the end of 2024, with nearly 30% stating they would potentially terminate employees who neglect in-office requirements, according to a Resume Builder's survey in August 2023.

While certain companies resort to punitive measures to enforce return-to-office mandates, others opt for higher salary offerings to entice workers to the office.

Companies Leveraging on Competitive Pay Over Flexibility

Julia Pollak, ZipRecruiter's chief economist, suggests that employers are compelled to compete more vigorously on pay if they cannot compete on flexibility.

According to a recent report from video-conferencing company Owl Labs, employees who divide their time between home and the office indicate that the top work perk that would encourage them to come in more is their company covering commuting expenses. Some companies may leverage improved compensation to enhance retention as turnover rates remain elevated in industries with fewer remote opportunities, such as transportation, manufacturing, healthcare, and leisure and hospitality.

Pollak notes that industries where in-person work is prevalent continue to experience significant turnover, with employers trying short-term measures like sign-on bonuses or extra paid time off to attract talent as temporary fixes.

Pollak further emphasizes that an increasing number of employers recognize the necessity of adopting long-term strategies, such as enhancing salaries or offering better healthcare benefits, to retain their top employees. However, it remains uncertain whether higher salaries alone will be sufficient to persuade individuals to opt for an in-office job over a remote opportunity, as numerous studies have indicated that people are willing to accept a reduction in pay in exchange for the flexibility of remote work.