Home offices: the new American workplace?

Iris Price | Improvement Center Columnist | July 31, 2014

More and more Americans are working from home according to the latest research. Who are these remote employees and home-based, self-employed workers? They include millennial hipsters and semi-retired baby boomers; men and women -- from stay-at-home caregivers and home-based entrepreneurs to professionals and service employees with full-time jobs that allow them to work remotely all or part of the time. So who needs a home office these days? Just about everyone.

Numbers don’t lie

According to the 2010 U.S. Census (based on surveys from ACS and SIPP), 13.4 million U.S. workers perform their job functions at least one day a week from the comforts of home. That’s a full 9.5% of all workers. Sound high? Other surveys have put that number even higher. The bureau of labor and statistics from the year reported that 24% of workers did “some or all of their work at home,” while Telework Research Network said 20 to 30 million U.S. workers did their jobs from home at least one day a week.

Regardless of who's counting, the trend seems irrefutable. But before you decide to invest in a home office, you might want to ask yourself, is working from home here to stay?

Well, consider this: The portion of the American workforce that regularly works from home grew 73% from 2005 to 2011. Projections indicate that even if no growth occurs at all in the workforce for the next few years, the number of workers who telecommute will increase another 69% by 2016. In the next year or so, International Data Corporation projects 2 million new home-based businesses will be added to the home office market, and the number of home office households used by corporate employees will surpass 27 million.

Keep in mind not every company is falling in with the trend, though. In February of 2013 Yahoo! CEO Marissa Mayer announced a ban on working remotely for her company's employees. She cited the need for in-person collaboration as a necessary element for Yahoo!'s success.

The tax break

Great news – People can get a tax deduction for their home offices. Bad news – Not many Americans actually take the IRS up on the offer. It involves complicated recordkeeping and calculations. However, in January 2013 the IRS announced a new simplified method for calculating the home office tax deduction. You can now deduct up to 300 square feet of home office space at $5 per square foot without figuring carryover deduction, allocated expenses, or depreciation. Just be aware you still must meet the requirements of "regular and exclusive use" to qualify.

Good reasons to work from home, both for employees and employers:

While you’re deciding if you’d like to take over a corner of the living or add on a whole new room for your home office, consider some of these happy-making stats for the work from home employee (and employer):

·         Employee satisfaction -- 36% would prefer to telecommute than get a raise

·         95% of employers say telecommuting helps them retain good employees

·         92% of employees are concerned about the expense of commuting.

·         Working from home can save between $1,600 and $6,800 -- and up to 15 days of time.

·         63%-71% of employees want to avoid the commute

·         Unscheduled absences cost employers $1,800 per employee each year.

·         78% of employees who call in sick have some other reason not to come to work

·         Two-thirds of employers say telecommuting increases worker productivity by 15-55%

With numbers like that, it’s no wonder that surveys found everyone from salaried business and finance professionals (25%) to self-employed persons (64%), from Millenials (1 in 5) to seniors over 65 (1 in 10), and all the way up to the top earners in the workforce are jumping on board. It may just be time to call up your contractor and talk about getting an office set up right in your home-sweet-home.






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About the Author

Iris Price is a single Baby Boomer whose antidote to a lack of retirement funds was to launch a long-delayed career as a writer. While others her age concoct bucket lists and travel the world, she bought a new-construction home and obsessively creates lists of must-have home improvements and personal realization goals. She specializes in writing about home services and self-motivation.