Bill Kerr: Since the lightning early pandemic pivot to work from home and hybrid models, business leaders have struggled to balance productivity, employee engagement, and organizational culture. And the stakes have never been higher. Now, in late 2024, what does the evidence say, and where do employee and employer priorities align or conflict?

Welcome to the Managing the future of work podcast from Harvard Business School. I’m your host, Bill Kerr. It’s a pleasure to welcome to the show Stanford economist Nick Bloom. Nick is a leading scholar on management, economic uncertainty, firm organization, and work-life balance. And he’s perhaps best known for his research on remote and hybrid work models. We’ll talk about Nick’s groundbreaking empirical research and what it means for employers. We’ll parse the survey data and trend lines and consider the skills organizations need to make work from home a success. And we’ll look at the rising influence of HR in the C-suite, the pandemic’s real estate impact, and how technology will influence the future of the hybrid organization. Nick, welcome to the podcast.

Nick Bloom: Bill, fantastic to be on. And I’m not sure how many people know, but we go back like 20 years, I think, to grad student era, when we first started working together.

Kerr: And have had one co-authored paper as well. So that was great. So, Nick, I will know the answer, but let me ask you for our listeners to say how you came to focus on remote and hybrid work.

Bloom: It was a personal interest. I’m one of four kids, both my parents worked. So I’m 51. I grew up basically in the ’80s in London. And I remember when one of us was sick or there was a school issue or something, one of my folks would have to work from home. It was carrying piles of paper, even phone calls were expensive back then, so they were complaining a lot. It really didn’t work very well. The ’90s you see the personal computer; 2000s, the internet. I’d just been interested how this has evolved. So I’ve been working on it for 20 years. I had a lucky break as well that a student of mine at Stanford was this guy called James Liang, that is the founding CEO and now chairman of Trip.com, and they were interested in experimenting in their firm. So those things collided, and I’ve been working on it ever since.

Kerr: And so, for the listeners, one of Nick’s early studies was well before the pandemic and looked at the productivity impacts at that firm when some people went remote, versus stay. So, Nick, it’s a big question, but tell us a little bit of your main findings as you had summarized them from your research in this area.

Bloom: So in some ways, the key paper is a paper I published in Nature in June 2024. And it basically argues that hybrid is very profitable for firms. So what it does is, it takes Trip.com, they’re a big global travel agent, their two rivals are Expedia and Booking. They’ve got 40,000 employees. They’re like a Goliath of a company. And they decided—James Liang, the chairman, and Jane Sun, who’s the CEO—to try out hybrids. They took two divisions. They have 1,600 employees in those two divisions. They’re all grads. About a third of them are post-grads. So these are pretty elite. They’re financing, accounting, marketing, computer coding. And they set up an A/B test. They basically said, “Look, half of them, people with even birthdays—so if you’re born on the second, fourth, sixth, eighth of the month—you have to come into the office for five days a week as they’ve always been doing. And they say for folks with an odd birthday—if you’re born on the first or fifth the month—you’re the lucky winners in a sense, and you are going to get to work from home on Wednesday, Friday for the next six months. And they rolled this thing out. And there are two main findings.

Kerr: Nick, I have to ask, before you go to the findings, we have to hear a little bit more of the origin of that particular randomization. And how was it experienced at the company when you announced that it was birthdays that was the deciding lottery pick?

Bloom: It seemed a natural thing to try out. Trip.com did not want to just rush straight into rolling it out without testing. It’s interesting, because you and I know companies, and particularly tech companies do an enormous amount of A/B testing on products, but they don’t tend to do it as much internally. And Trip said, “Look, this is a huge decision. We’re thinking of doing it, but we actually want to set it up as an experiment.” And for the employees, well, trying it out is better than nothing. As it happens, I’ll explain, they rolled it out to the whole firm. So even in the sense of control firm folks, they didn’t get to work from home for those six months, but eventually they did.

Kerr: Okay. So it helped that they were approaching it with the experimentation for the business to assuage any political questions as to who got picked or that somebody else knew that they were A, but their compatriots were B.

Bloom: Exactly. In fact, I also put out a summary in Harvard Business Review in October ’24, on this thing. And there were four “so-what’s” for firms, and number four was do more A/B testing of practices within the company. Trip.com had 20 divisions. They tested that on two, and the results were so convincing, it was easier to then roll it out to the other 18. So what did they find? So the first thing they found was, interestingly, no effect at all on performance. So they looked at promotions, they looked at performance reviews, they looked at innovation and leadership scores, they looked at lines of code written, they found absolutely nothing. When you interviewed people, they would say, “Look, if I come into the office three days a week, that’s really valuable for mentoring, for innovation, for face-to-face building of culture. That’s great. But it’s less clear what days four and five buy me, because, sure, I get a little bit more mentoring and innovation, but I’m losing those two days a week at home, which are great for quiet time. I can think better, because there’s less distractions, and I save on the 45-minute commute in each direction, and that gives me just more time. I’m more rested.” And so it turns out, for these employees, at least, which are grads—think of our Stanford, Harvard elite grads. Once you’re in the office three days a week, it looked like it was about enough. So days four and five, they weren’t worse for performance, they weren’t any better. The second result was quit rates fell by 35 percent, which is massive. And when you survey it, employees, they’re dramatically happier. And all kinds of stories. It’s obvious. They’d say, “I avoid the commute. If I want to go to the dentist, I can do it on a Wednesday morning. It’s quiet, I prefer it.” And for the company, they looked at it, and they said, “This is amazing. Every person that quits the company costs us about $50,000, because now there’s nobody in that post. We then got to go out and advertise. We then got to interview, we’ve got to recruit, we’ve got to train them. It takes a year and a half to get someone up to speed. They said it’s hugely expensive having turnover. So the C-suite looks at this and says, “Hybrid’s going to increase profits by tens of millions of dollars a year.” So after seeing it, they rolled it out to the whole company. And that is one A/B test, one example of why hybrid has become so dominant. It’s not better, it’s not particularly worse for performance, but it really drives down recruitment and retention costs. And so, ultimately, it’s very profitable.

Kerr: Yeah, Nick, and recognizing that for the purposes of establishing causality, these types of trials are great. But there’s also just a wealth of now experiences. Many companies have taken many different strategies. Does that three-day optimum and productivity null effect align with what we’ve just seen in the general data?

Bloom: Yes, exactly. So by this point, I’ve probably spent most of my day every day talking to firms about work from home since, what, the last four years now. And yes, hybrid’s pretty dominant. So the Flex Index has data for the S&P 500 in the U.S. About 80 percent of them have hybrid for managers and professionals. Stanford, just to use an example, so we have, probably similar to Harvard, about 20,000 employees. Roughly 10,000 come in every day. They cannot work from home. So they are, think of food service, cleaning, transport, security, nursing, et cetera. We have about 8,000 that the manager is a professional in a sense of some faculty, et cetera, accounts. They’re typically hybrid. And then we actually have interestingly, a couple of thousand of fully remote. So who are they? They tend to be more back office. So if you are hiring someone to say do payroll or call center or data entry, or for me, for example, I work with some folks on processing research grants. They just don’t need to come in. And it’s a lot cheaper for us if you don’t have to pay people to work in the Bay Area. So it turns out for big companies across the U.S. and Europe, hybrid is dominant for managers and professionals, but it’s typically for frontline staff that are in every day.

Kerr: So Nick, you mentioned earlier measuring both productivity in terms of lines of code. You also talked about savings in terms of turnover costs. There can be capital expenditures. In the end, how are you advising companies to think about measuring and managing the work-from-home performance? What do they typically use as their metrics?

Bloom: So great question, very HR-relevant question. So I think there are two key learnings to managing hybrid. So the obvious one in a sense is coordination. So when you ask people, people like the typical employee, if she wants to come in the office two, three days a week, and when you ask them why, basically it’s about working face-to-face with colleagues. It’s not spending time with their manager. It’s not the ping-pong table or the free bagels. And that means, if you’re going to have, say, a three-day week hybrid, you should just coordinate—either team by team or the company coordinate. Point two is that the hugely HR-relevant piece—which is, it turns out, performance reviews and proper performance management—is critical for working from home. So, Bill, if you are my manager, imagine the days I’m in the office, in a sense you can manage me by just watching what I’m doing. I would say it’s five out of 10 management. It’s okay. It’s like measuring inputs. The problem is, if I’m at home, you have no way of seeing what I’m up to. Now you could get surveillance software, but it’s creepy, and people absolutely hate it. So I would never advise anyone to do it. So now you are like, “Now you’ve got to evaluate Nick’s outputs.” So it was always good management even before the pandemic, but with working from home, it’s become absolutely critical.

Kerr: And Nick, as you think about the structure of those days, do you give advice as to how to think about scheduling meetings? Earlier you gave the example of people need the quiet time, they need the time to reflect. So are the days away from office also supposed to be relatively not on Zoom, not on Teams, but kind of spent for just work, and then let’s cram all the meetings in? Or do most companies just tend to schedule the meetings because it’s actually easier to schedule it when everyone’s at home maybe.

Bloom: Great question. The most common version of it would be Tuesday, Wednesday, Thursday, I’m in the office. Monday, Friday I work from home. So in reverse, Tuesday, Wednesday, Thursday, there’re great days to have in-person meetings. So what you would say is, any presentations, maybe feedback, performance reviews, meetings, lunches, events, drinks, training sessions. Often people talk about the return on commute. If people come into the office, there’s got to be a reason to come in, and it means trying to actually avoid tons of Zoom meetings or Teams meetings on those days, because otherwise, there’s nothing that sends employees more angry than commuting into the office and spending all day on Zoom and going home again. So Monday, Friday is good for reading, writing, quiet stuff that you need to concentrate. You don’t need to be around other people. Maybe cross-office Zoom meetings or meetings with clients, customers that are on Zoom. And that way you really split your week out and just kind of working smarter. It’s like, if you go back to 2019, you may have still have had three days of face-to-face time, but you spread it out over five. So there’s a lot of quiet heads down work in the office. Now that quiet heads down work should really be pushed if possible to Monday, Friday. Or there are other cadences. There’s Monday, Tuesday, Thursday in the office; Wednesday, Friday at home. There’s all kinds of variations.

Kerr: As you think about the work you’ve done, a very important component has been surveying. You’ve been surveying basically since I think the day we learned about Covid—regularly, people’s remote work preferences, what businesses are doing and so forth. So can you give us your latest numbers and maybe a little bit of the trends you’re seeing in the data? How many people are fully remote? How many people are in hybrid mode? Is the number going up or down?

Bloom: Sure. So the easy number is roughly 60 percent of North Americans and Europeans are fully in person. There’s about 30 percent that are hybrid. Typically, these are grads, so all of the grads are MBAs, exec head, probably most listeners are probably hybrid. And then, for fully remote about 10 percent. Fully remote’s a bit all over the place actually. There’s a lot of people in there that are data entry, call centers, payroll, but there are some journalists, high-end coders, etc. In terms of trends, so before the pandemic, about 5 percent are four days were work from home. If you go back 2019, Bill, you and I would occasionally work from home. Academics did a bit more, but it wasn’t that common. Probably you did go in every day and typical thing that folks would do. It goes to 60 percent in April 2020, which is astronomic. If you can work from home, you’re doing it, and you’re doing it pretty much every day. It drops, drops, drops until the beginning of 2023. At which point, since that time it’s actually been pretty flat. So if you look at our survey data this way, we have our own survey of the census, or actually Kastle has swipe data on whose going into the office. All of that stuff’s pretty flat over the last two years. People are always a bit surprised by that, but you should look at big data and not just the latest newspaper headline.

Kerr: When I last saw the survey results, there was a persistent gap between what employers were hoping and what workers were hoping. And has that gap persisted until today, in that generally, on average, workers want another half a day remote, whereas employers would like it to go a little bit in the opposite direction?

Bloom: So exactly right. If you look at the data, the typical employee wants to work from home about two and a half days a week. So there’s a big range—let’s just say 20 percent of people want to come in every day. They tend to be 20-something. So they’re like, “I want to socialize, I want to get mentored, and my apartment’s tiny. Where am I going to go?” There’s 30 percent at the other end that are typically in their 40s with young kids, nice house, well in their career and say, “You know what? I love working from home. I don’t want to go in hardly ever again.” So the average is two and a half days. If you look at what employers are typically offering, or what they think is right, they’re offering more like two days on average, a bit below.

Kerr: So, Nick, what does the data say about return-to-office policies and are there any prominent examples?

Bloom: It’s interesting. When you talk to CEOs, particularly CEOs with demographics more like me, older men, they tend to be more in-office based. The reality is, the labor market. If you try and do an Amazon, you ask people back five days a week into the office, you’re going to see enormous quit rates. And so, in fact, just to comment on Amazon, the reason that Amazon went for the five-day RTO [return-to-office], is basically they wanted to reduce headcount. So Amazon’s view is, “Look, we’ve got five, 10 percent too many employees, we’re over-hired in ’21, ’22. One way to do it is just to require people back and we’re going to see five, 10 percent of the employees leave. Now, obviously that’s a cheap way to reduce headcount because you don’t have to pay severance pay, but it has a nasty sting that your best employees tend to walk out the door in the hottest areas like AI. So it is a strategy. But it’s a very costly strategy in terms of growth.

Kerr: So Nick, what are some of the latest numbers on return to office policies?

Bloom: So at our remote work conference back in October ’24, there was a paper that had an amazing piece of analysis. So it looked at all the return-to-office announcements for the Russell 3000, so the 3,000 largest firms in the U.S. This pretty much is every firm you’ve ever heard of is in that list. What did they find? RTO announcements tend to happen after periods of bad performance. So it’s not clear why, but one explanation is CEOs trying to turn things around. Another explanation is they’re just blaming it on work from home and looking for an excuse. Second finding is performance doesn’t get better, but it doesn’t get worse. Stock price doesn’t go up, it doesn’t go down. Third finding is employees certainly really dislike this. They go to Glassdoor, and they look at employee ratings, and after firms make RTOs, they absolutely tank. And then finally, which I thought was perhaps the most interesting, was there’s a very big CEO demographic tilt to this. So older male, more powerful CEOs are more likely to announce RTOs—and they define power, by the way, as the ratio of the CEO salary to the rest of the board. Younger female, relatively more egalitarian CEOs are less likely to. So the final thing, to me, it is partly a manager’s style. All of it together means RTOs typically aren’t good or bad. A lot of it is honestly just around who the CEO is and what he or she thinks.

Kerr: So, Nick, some of the examples you’ve given are very focused on groups like a working parent who has got a lot of needs for getting kids to and from not only the dentist office and school, but to other events. Have employers tried to use this in ways to target those specific groups of workers? Or is there a type of worker that is most drawn into the workplace consciously through hybrid models?

Bloom: So, yes, absolutely. So work-from-home policy definitely has overlap with, say, diversity policy. If you look, you see in the data, women have a somewhat higher preference to work from home than men, primarily those with kids. If you’re, say, in tech or in finance, and you are very aggressive and require five-day return to the office, you’re going to start to see issues, particularly with female middle and senior managers. Recruitment and retention of that group’s going to be really problematic, and it’s going to hit the firm. Another group I want to highlight is folks with a disability. Now there’s actually an increasingly large group in the U. S. There’s something like 20 million Americans now with a disability. If you look at it, it tends to be people 50, 55-plus. So they struggle a bit to walk or maybe vision issues, or maybe they’ve had cancer and have a colostomy bag, or they have issues with background noise, back pain. These people also are enormously impacted by having to come in five days a week. So imagine I have really bad back pain, if I can work from home three days a week, I don’t have to commute on those days. I can also manage my chair and my working environment. And so that’s another group. There’s some research on minorities by race, by religion, actually, by politics. So it turns out, work-from-home policy at least hybrid is quite supportive of having a more diverse office setup.

Kerr: But let me take it all the way to the other extreme, which is why aren’t we arching even more toward fully remote, which would allow for many more disability-related issues, a much broader reach of the employee base and so forth? We’ve had on this podcast a few executives come in and argue that hybrid is the hell that’s in the middle, and the appropriate policy is to go all the way to fully remote. How do you think about that in your work, Nick?

Bloom: So fully remote definitely works for certain segments. Let’s start with the upsides of fully remote. You don’t have to pay for an office. Enormous cost savings—that’s about 10 percent of costs. Fully remote, there are flavors of even fully remote. So some of them say they want people to meet up once a quarter in person for events or once every six months. So if you’re doing that, you may say, you want to hire them in North America. There are some firms like GitHub that may never meet. And so, in that case, you are global. So the second advantage is clearly you can access national and global labor markets, which really reduced its labor costs. The downsides tend to be A) around mentoring. When I talk to my undergrads, I generally advise them not to take a first job that’s fully remote, if possible, because it’s easier to learn when you’re in person. B) it is easier to innovate. There’s another paper in nature last year with some A/B tests on this. And thirdly, this is the most intangible, but I’d say it’s the weakest of the three. It’s like building culture. It’s not clear really what is meant, but it is, when people are in person, they do tend to, I don’t know, talk about outside activities, and you get to know them. But it really depends on the person. To give you two extreme cases: a 23-year-old fresh out of college [and] someone in their early 40s who has two young kids and a back issue. So there is a big spread. And in some ways the best benefit the pandemic is all of these options exist. So often tell folks, look, if you want to be fully remote and your firm is aggressively forcing you back in five days a week, probably the best thing to do is, if you can, change jobs or at least change teams. Many organizations have different teams with different patterns.

Kerr: You mentioned earlier that since 2023 have stabilized the shares. And is your best guess that these shares are going to just persist for the next decade? Or do you anticipate longer term it to move in one direction or the other—maybe as complementary technologies continue to develop or as new generations of workers who grew up in a different model or you’ve mentioned the CEO that has channeled the way that it was when he or she was younger? So do you think any of those things are going to ultimately change the mix?

Bloom: Absolutely. So in fact, in another piece in HBR I talked about the Nike swoosh of work from home, which means it dropped a bunch from 2020 to 2022, 2023. It’s flat for a few years, and then, I don’t know, ’25, ’26 onwards, it’s going to start to slowly pick up. Three things that drive that growth. One, exactly as you said, is cohort effects. Younger folks are more comfortable with it. Secondly is, just leases. The mechanics of leases. They’re typically 10, 12 years, many leases, and as they expire, firms often use it chance to downsize. Third, the most exciting is technology. It turns out work-from-home numbers have gone up about five X. So every firm venture capital company, Microsoft, Google has suddenly seen that this big market and said we should spend more R&D on it. And that’s having a real effect right now. So think of things like virtual reality, augmented reality. I was in Google two weeks ago and saw some fantastic prototypes about 3D meeting equipment. I was up in San Francisco, some start-up has this portal thing, it’s like a 12 by 12 foot effectively Zoom screen with cameras throughout it. Five to 10 years from now, work-from-home days are currently about 25 percent of days. I guess 10 years from now it’d be more like 35 percent. If we look back, I have data going back to the ’60s. You can see this was just steadily increasing for decades. If you think back in the ’80s, it was terrible. It was like carrying paper and phone calls. Then we got the personal computer in the ’90s. And we got the internet, cloud, video call. So in the long run, it’s very clear: Work-from-home levels are going to rise. So when I talked to execs, I was like, if you are planning real estate 10 years out, you should think work from home will be higher then than it is now.

Kerr: I know that we’re parsing details of a crystal ball forecast here, but do you think it’s because that 60 percent that is all the time is going to become 50 percent? Or is it that the people that already that were already in hybrid mode will go from being two days at home to being three days at home? So is it more in the intensive margin or the extensive margin that this change will happen?

Bloom: Yes. So I think fully in-person will shrink. I’ll just give you two interesting anecdotes. One is physicians. So a lot of physicians now will have one day a week on Zoom, because many patients and the physicians don’t want to go in person. So I need to get a prescription renewed or get a blood test back, and I may find it a lot more convenient to actually just meet over Zoom. Another great example I love, actually, is fast-food restaurants. It turns out when you go into a drive-in restaurant, the person taking that order in that speakerphone used to be in their little cabin 30 feet away. There’s no need to be there, because all they’re doing is taking the order and punching into a computer. In California or up in Boston, you don’t need to pay someone $20 an hour to do that if you can pay them, say for the company’s mind, $10 an hour to do or $15 somewhere else. Fully remote is less obvious, because on the one hand it will grow a set of tasks, but AI and offshoring is going to threaten some of the less innovative, more repetitive tasks. So that could easily shrink in the U.S. So, for example, call center, data entry, payroll, that may be more AI, or it may be shifted to the Philippines say or Mexico within the next five years.

Kerr: Yeah. We did an earlier podcast with Richard Baldwin, who described this path that, once something became fully remote, it was just a ticking clock until it was either going to be offshored or it was going to be automated in some way. Nick, a lot of things we’ve talked about seem to be relatively short term, in terms of measurement. Do we start to assemble long-term benefits or costs that are not so obvious immediately to the company or to the person that’s doing the hybrid work, but maybe the mentoring ends up being less, or something that over time we see accumulate but isn’t so obvious in the short run?

Bloom: So yes, I think if you are. I mean, again, I’ll just give you an anecdote. But if you are fully remote it can be harder to mentor and develop. So I was talking to an accountant, and she was saying you need two years of remote experience to one year of in-person. I’m a big fan of work from home, but often for positions that need a lot of training, you want two, three days in. If you don’t get that, there can be some shorter- and longer-run trade-offs. My advice is to any individual, if you want to learn and particularly get promoted, you probably want to come in two, maybe three days a week.

Kerr: Nick, you mentioned earlier the leases, and you’ve done work on real estate. So I’d like for you to explain to us the donut effect and a few of the other key findings about how all of our city landscapes are being reshaped by these work-from-home policies.

Bloom: So we put out a paper in the Proceedings of the National Academy of Sciences back in October 24. And what we do is we looked at very detailed data right across the U.S. for the U.S. Postal Service and globally from Mastercard. And you see this donut effect, in the sense that folks have moved from city centers out to the suburbs. So, Bill, if you imagine you used to work the very big bank, and you went in five days a week in 2019, now you’re allowed to work from home two days a week, you think, well look, I need a bit more space for a home office. I don’t mind such a long commute. So we’ve seen millions of people have moved out to the suburbs. Spending has followed suit. So you see food and drink spending, in particular, has moved out to the suburbs, too. That is meant that in other data I’ve looked at with Gusto, say looking at payroll data, employees are now average living almost twice as far from their firms. So for companies, that’s interesting, in the sense that your labor market where you can hire people from has got a lot bigger. So a second fact is employees are now living a lot further away, which is generating a lot of the interesting competition. So I was talking to some law firms, and they were saying, yeah, these are medium-sized law firms. The partners are more mobile, because me and you are like different law firms are in, one is in San Francisco, one is in San Jose. Previously if you had to come in every day, I wouldn’t really compete with you for the partners. Now they can commute across these cities. So labor markets are bigger. It’s great in some ways for hiring, but it means these labor markets are more competitive.

Kerr: And if I’m remembering how we calculate the area of a circle, if you can double the amount of space or the length of the radius, it’s a four-fold increase in the size of the effective labor market that you’re getting from this.

Bloom: No, you’re right. There’s a big increase in labor markets. The final thing that’s funny just on the other side was the impact on golf. We used the GPS data for millions of cars, and you can see that golf playing has totally exploded post-pandemic, all day, every day, and it’s basically work-from-home employees. And it’s actually true for the whole leisure sector. So if you think of pickleball, gyms, hair salons, shopping malls—all of these things, their demand is spread out because folks are at home and they think, “On a game of pickleball, I’ll go play in the afternoon, and then I’ll make up for it working a bit more in the evening.” In reverse, office space has become really compacted. So office space has been pushed into three days—Tuesday, Wednesday, Thursday—and then leisure has been pushed out. For an HR audience, the golf thing is a great example of why you want performance management. So Bill, if you are managing me, and I’m at home, it’s totally fine If I go play golf for a couple of hours, I’m a big golf fanatic, and make up for it in the evening, but you just need to make sure I get my job done. Which is why remote management, work-from-home management just needs more performance evaluation, and we’re both win-win.

Kerr: Nick. Great. Let’s stay right on there because I think it’s a great place for us to go next, which is the role of the manager. And you find most managers are handling hybrid work well? And if not, what’s the thing that they most need to adopt to be better at it? And performance management clearly is one aspect of that, but are there other things that you see as the common shortcoming of somebody trying to manage this environment?

Bloom: Normally, the gripes I hear about hybrid come from badly coordinated systems or people that don’t have good performance evaluation. In some ways, it’s really not that radical. If you go back to 2019, we often worked in mornings and evenings. People would often be traveling. It wasn’t the case. When I talk to folks in real estate, they’d say in 2019, a typical desk was only occupied 70 percent of the time, so now it’s 50 percent, it’s not 45 percent, it’s not so extreme. But you do need to get a couple of basic principles.

Kerr: Let’s go to even a broader sweep of things, which is we hear so much more about the Chief Human Resource Officer, the Chief People Officer, and, in fact, because they’re called that and not the senior vice president of HR signifies something different. And you’ve been tracking a little bit of this, the rise of the HR functions. So tell us a bit how you think the pandemic and this work from home or work from anywhere model has changed the role of the CHRO. And what do you anticipate going forward?

Bloom: Yeah, so I first got interested in this because the number of times I talked to CHRO, CPOs, boards, and it was clear that HR is becoming increasingly important. So one example we’ve talked about is the rise of performance evaluation. So a lot of companies, when I say you’ve got to do more an output and input performance, many companies are on it, so they totally get it. It involves more HR. There’s also around managing real estate. So if you go back to 2019, office purchasing, real estate decisions were a lot of CFO land. It was like lease lengths and financing and various stuff like that, quite technical stuff. Now it’s very closely related to HR. So if HR says we’re in hybrid or it says we’re going to have flex day, whatever it is, you have to coordinate. And so quite often, real estate functions have either been crossed now to under CFO and CHRO are actually moved. And then there are issues that predate the pandemic. Things like Me Too, Black Lives Matter. There’s a whole bunch of themes. So I was like, “Well, how much is this as part of a longer term?” We know as you know the U.S. economy, European global economies become human capitalized, and people have become relatively more important than land and buildings. Is there a bigger, longer trend? So I looked at, there’s something called the DEF 14A statement or the proxy statement. For publicly listed companies in the U.S., you have to list your five most important executives. Now obviously, the CEO and the CFO are there. So the interesting question is, who are the other three? So I had data for the S&P 1500, the largest 1,500 firms going back to 1993. And so what do we see? What see is back in ’93, less than half a percent were HR. What you see is year by year, HR has a rising, rising share of those top five execs. In the most recent data for 2023, it’s up to about 13.5 percent. The other that’s also notable is you can look at pay. HR are less paid on average, but that gap has closed quite a bit.

Kerr: Nick, as a final question, what’s next in the research agenda? What part of this landscape do you want to learn the most about going forward?

Bloom: I don’t really have a long-term master plan. The work-from-home stuff is amazing. So I mean right now I’ve been doing stuff, for example, looking at folks with a disability, looking at impact on pollution. There’s a really interesting question. People say, “Is it good or bad for the environment?” Initially, it seems really great, and I think it is net great, to be clear, because you save all these commutes. But a lot of folks will point out, “Well look, when you’re working from home, often you have the office HVAC on as well as the home.” And now people are living further away. So they’re commuting less, but there are longer commutes. There’s a related social theme, which is the benefit to kids. So we see in the American Time Use Survey that people that work from home spend more time with their children. So I think much as the pandemic, I have kids, you have kids, it was really bad for kids. Long-run hybrid and working from home is a positive in the sense that parents can spend more time with their kids. And so there’s some really interesting social benefits that come out of this.

Kerr: Nick Bloom is an economist at Stanford University, expert on the work from home models and where it’s going. Nick, thanks for joining us today.

Bloom: Bill, thanks so much for having me on the show.

Kerr: We hope you enjoy the Managing the Future of Work podcast. If you haven’t already, please subscribe and rate the show wherever you get your podcasts. You can find out more about the Managing the Future of Work Project at our website hbs.edu/managingthefutureofwork. While you’re there, sign up for our newsletter.