There is a cost to offering remote work. There is also a cost to NOT offering remote work!

In the ongoing debate about remote work, much of the focus has been on its benefits—improved flexibility, lower overhead, and access to a wider talent pool. However, the more consequential lens may be to evaluate the costs of not offering remote work. Companies that fail to adopt flexible policies risk losing competitive advantage in talent acquisition, productivity, retention, and even market relevance.

A growing body of data shows that employees not only prefer remote work—they expect it. According to a 2023 Gallup poll, 8 in 10 employees who can work remotely now expect hybrid or fully remote options. Moreover, a FlexJobs survey found that 97% of workers desire some form of remote work. By refusing to accommodate this shift, companies effectively narrow their talent pipeline and self-select for candidates with fewer options.

The cost of employee turnover is staggering—often cited as between 50% to 200% of the departing employee’s salary. Recently, at the Running Remote conference in Austin, somebody threw out the number that it costs $50,000 to replace an employee. A report from Owl Labs found that companies that don’t offer remote options experience 25% higher turnover. Considering the average cost of turnover per employee is over $15,000 (according to Work Institute), the cumulative cost of not offering remote work can escalate quickly for organizations with even moderate headcount.

Despite early fears, remote work has proven to increase productivity in many cases. A two-year Stanford study found a 13% performance increase among remote workers, alongside a 50% drop in attrition. Microsoft’s 2022 Work Trend Index reported that 87% of employees felt productive working remotely, while 85% of managers still felt performance expectations were being met. Denying remote work can actually suppress productivity, leading to a measurable loss in output per employee.

Organizations with rigid, office-first policies often incur significant real estate expenses. Global Workplace Analytics estimates that a typical employer can save about $11,000 per half-time remote worker per year in real estate, utilities, and operations. Firms not leveraging remote policies continue to carry these unnecessary fixed costs while also struggling to justify them in boardroom financial reviews.

Remote work supports more inclusive hiring practices, enabling companies to tap into underrepresented groups and diverse geographies. McKinsey research shows that diverse companies outperform less diverse peers by up to 36% in profitability. Restricting work location inherently reduces diversity potential and, in turn, limits innovation—a critical cost in a knowledge-based economy.

Remote work also lowers an organization’s carbon footprint, contributing to sustainability goals. A study from Global Workplace Analytics suggests that if those with remote-compatible jobs worked from home just half the time, the reduction in greenhouse gases would be equivalent to taking the entire New York State workforce off the road. Companies that refuse to modernize risk losing ESG-minded investors and consumers.

Not offering remote work can exacerbate burnout. The American Psychological Association has reported rising stress levels linked to long commutes, rigid schedules, and lack of autonomy. In contrast, remote work enables employees to manage their time better and achieve greater work-life balance. The downstream costs of burnout—including absenteeism, healthcare claims, and reduced engagement—can be immense and often underreported.

Competitors embracing remote work are moving faster, cutting costs, and attracting better talent. Tech giants like GitLab, Zapier, and Automattic have thrived with distributed workforces. In contrast, firms that resist remote work often experience reputational decline and lose top candidates to more flexible competitors. The cost of market irrelevance is far greater than any logistical challenge remote work might present.The question is no longer whether remote work is viable—it is whether a company can afford not to offer it. The direct and indirect costs of inaction range from diminished talent acquisition and increased turnover to wasted capital and weaker environmental outcomes. In today’s economy, failing to offer remote work is not a neutral stance—it’s a strategic liability.