UK finance minister says working from home may hurt productivity

BRITISH finance minister Rachel Reeves said working from home reduced the chance of boosting economic productivity, striking a different tone to other ministers in the new Labour government which plans to legislate in favour of flexible working.

Britain suffered a marked slowdown in growth in output per hour worked around the time of the 2008 global financial crisis from which it never recovered, and which appears to have worsened since the Covid-19 pandemic.

While almost all economists view higher productivity as essential for boosting living standards over the long run, the evidence of the impact of working from home on productivity is much less clear.

Reeves said in an interview with LBC radio on Monday (Sep 23), ahead of her speech to Labour’s annual party conference, that remote working made it harder to become more efficient.

“I am all for being flexible and making sure that people can be able to balance work and family life, but I do think that productivity gains are more likely to happen when you have that sharing of ideas and bringing that together,” she said.

Reeves said her officials had benefited from working in the office during the weekend after she became finance minister, rather than holding online meetings.

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Last week business minister Jonathan Reynolds said that for him, it was not a priority for officials to be in the same location, and that employers should assess staff by results rather than their physical presence in the office.

“If we want to address this low-productivity low-growth Britain ... let’s judge people by what they do, by their output, not ... whether they’re sat at a desk,” he told LBC.

Labour said in July it would introduce new legislation “making flexible working the default from day one for all workers, with employers required to accommodate this as far as is reasonable, to reflect the modern workplace.” REUTERS