The Declining Trend of Working from Home in Australia: What It Means for the Future of Work

As of February 2025, Australia appears to be witnessing a subtle but significant shift away from the widespread work-from-home (WFH) culture that took root during the COVID-19 pandemic. While remote and hybrid work arrangements once seemed like a permanent fixture, recent data, employer policies, and commercial real estate trends suggest that the pendulum is swinging back toward office-based work. This change raises questions about productivity, employee satisfaction, and the broader implications for the Australian workforce in the coming years. Is this shift necessary, or is it simply a box-ticking exercise by employers and businesses?

The Evidence: A Gradual Return to the Office

Recent statistics paint a clear picture of this evolving trend. Data from the Australian Bureau of Statistics (ABS) indicates that the percentage of employed Australians regularly working from home has decreased over the past year, dropping from 37% in August 2023 to 36% in the latest reports [link to www.abs.gov.au] (http://www.abs.gov.au]). While this decline might seem minor, it marks the first downturn since the pandemic peak in 2020, when as many as 53% of Australians worked remotely at some point. This suggests a growing preference—or pressure—among employers to bring workers back to physical office spaces.

Major companies have been at the forefront of this push. High-profile firms like Amazon, Flight Centre, and Dell have recently mandated a return to the office for five days a week, with Amazon’s policy taking effect in January 2025. Other large employers, such as the Commonwealth Bank, have required staff to spend at least 50% of their time in the office since mid-2023, a move that faced union challenges but was upheld. Trending discussions on social media platforms like X also highlight similar policies being rumoured or implemented, with some employers reportedly considering mandates of three to five days a week in the office, far exceeding the hybrid models that once balanced flexibility and collaboration.

Commercial vacancy rates further underscore this shift. According to the Property Council of Australia’s latest Office Market Report, office vacancy rates in major CBDs remain high, averaging around 14.6% nationally, with Melbourne experiencing the highest at over 19% [link to www.pc.gov.au] (http://www.pc.gov.au]). However, there are signs of recovery, particularly in premium office spaces close to transport hubs in Sydney and Melbourne. Leasing activity has picked up, and employers are investing in higher-quality office environments with better amenities, such as natural light, improved air quality, and collaborative spaces, to entice workers back. This “flight to quality” trend, as noted in industry analyses, reflects a strategic effort to justify the cost of maintaining office spaces that have seen reduced utilisation since the pandemic.

Why the Push Back to the Office?

Employers cite several reasons for these policies, with productivity being a central concern for many CEOs. Many argue that in-person collaboration fosters innovation, strengthens company culture, and improves team performance—claims supported by surveys like the KPMG Global CEO Outlook, where 83% of CEOs globally, including 82% in Australia, expect a full return to the office within three years. Australian CEOs, such as those from Amazon, Flight Centre, Dell, and Tabcorp, have voiced concerns that remote work may hinder productivity, citing a perceived need for face-to-face interactions to boost performance. For instance, Richard Wynn, CEO of the CEO Institute, suggested that in-office work could enhance output through better collaboration, while Matt Loop from Rippling noted that 57% of Australian employers are less likely to hire candidates unwilling to work in the office five days a week, implying a belief that office presence improves teamwork and engagement, which they associate with higher productivity.

However, the evidence supporting lower productivity at home is not as conclusive as some CEO statements suggest. Studies from the Productivity Commission (2024) and the Australian Institute of Health and Welfare (AIHW) indicate that productivity while working from home is often comparable to—or in some cases better than—in-office productivity. A 2021 study by Great Place to Work Australia found that 85% of Australians in a 2020 Adaptavist survey reported equal or higher productivity at home, and the Productivity Commission’s 2024 bulletins show that Australia’s broader productivity stagnation (e.g., a 0.5% decline in labour productivity in the September 2024 quarter) is tied to structural issues, not specifically to WFH Nicholas Bloom’s 2024 study of 1,600 workers, referenced by CEDA, found no significant difference in productivity between hybrid and office-only workers, with hybrid arrangements maintaining performance, reviews, and innovation while improving job satisfaction and reducing attrition. Challenges like technical issues or blurred work-life boundaries exist for some, but only 42% of HILDA survey respondents reported negative productivity impacts in 2020, often due to early pandemic disruptions, which have largely been resolved by 2025 with better technology and hybrid models.

Additionally, commercial property owners and city planners are eager to revitalise CBDs, which have been described as “ghost towns” due to lower office occupancy rates. Linking bonuses to office attendance, as seen with banks like ANZ and Origin Energy, is another tactic designed to incentivise physical presence.

Employee sentiment, however, tells a different story. Surveys, such as the 2024 National Working Families Survey, reveal that 76% of respondents would not apply for jobs without flexible working options, and 60% of working parents and carers value control over where and when they work. Women, in particular, benefit from remote work, as it helps balance caregiving responsibilities with professional duties. Forcing a full-time return to the office could risk alienating talent, especially younger workers and marginalised groups who see flexibility as non-negotiable.

Implications for the Australian Workforce

If this trend continues, the Australian workforce could face several challenges and opportunities in the coming years. On one hand, a return to the office might enhance mentorship, networking, and spontaneous collaboration, particularly for new entrants like Gen Z and Millennials, who value social interaction and career development. Industry experts, such as those from CBRE, note that upgraded office spaces with amenities like cafes, parking, and technology hubs are designed to make the commute “worthwhile” for employees.

On the other hand, rigid policies could lead to higher turnover, reduced morale, and productivity losses. The data shows that 78% of Australian employees believe remote work reduces living costs, while two-thirds of marginalised groups feel it protects them from discrimination. If productivity at home is comparable—or even superior, as some studies suggest—then mandating daily office attendance might simply be a box-ticking exercise to satisfy corporate hierarchies or real estate interests, rather than a genuine need for collaboration.

The question of whether all jobs require day-to-day in-person collaboration is valid. For knowledge workers, such as those in IT, finance, or marketing, much of the work can be done digitally with occasional face-to-face meetings for brainstorming or team-building. A hybrid model—say, suitable for the role and function—seems to strike a balance, aligning with employee preferences and maintaining some level of office utilisation. The ABS data shows that 60% of managers and professionals still regularly work from home, suggesting that many roles don’t necessitate constant physical presence.

Australian Hybrid Work Trends: Should It Be This Way?

The push to end WFH entirely doesn’t seem justified if all else is equal, particularly given the evidence that productivity at home is often comparable or superior for many Australian workers. Collaboration is undoubtedly valuable, but it doesn’t always require daily office attendance. Companies like Atlassian, which allow staff to work from any of 13 countries, demonstrate that innovation and team cohesion can thrive remotely with the right tools and culture. Employers should focus on outcomes—productivity, project delivery, and employee well-being—rather than enforcing policies that might only serve to fill empty office towers or appease stakeholders.

For Australia’s workforce, the future lies in flexibility, not absolutism. Employers who ignore employee preferences risk losing talent to competitors offering hybrid or remote options. At the same time, workers should recognise that some in-person time can foster connections that digital tools can’t fully replicate. A balanced approach, driven by data rather than dogma, would ensure that both businesses and employees thrive in the post-pandemic world. While CEOs like those from Amazon and Flight Centre emphasize productivity gains from office work, the data from the Productivity Commission, AIHW, and Bloom’s study suggests that hybrid models can maintain or even enhance productivity, challenging the notion that in-office work is inherently more productive.

In conclusion, while the working-from-home trend in Australia may be waning, it’s not necessarily the end. The data and policies suggest a compromise is needed—one that values productivity wherever it occurs, ensures some collaborative in-person time, and respects the diverse needs of a modern workforce. Anything less risks turning the clock back without clear evidence that it’s in anyone’s best interest.

Key Takeaways: Is Remote Work Dying in Australia?

The WFH trend in Australia is declining, with remote work dropping from 53% in 2020 to 36% in 2025.
Major companies like Amazon and Commonwealth Bank are mandating office returns, citing productivity and collaboration, but studies show productivity at home is often comparable or better for many workers.
Australian hybrid work trends (2–3 days in the office) offer a balance, aligning with employee preferences for flexibility and maintaining productivity, as supported by 85% of workers in 2020 surveys.

Frequently Asked Questions (FAQs)

Is remote work disappearing in Australia? No, but it’s declining, with many employers shifting toward hybrid or office-based policies, driven by CEO concerns about productivity and collaboration.
Why are companies mandating office returns? CEOs cite productivity, collaboration, and culture as reasons, but evidence like Bloom’s 2024 study shows hybrid work maintains productivity, suggesting other factors like real estate or culture may also influence decisions.
Is productivity lower at home? No, studies from the Productivity Commission and AIHW show productivity at home is often equal or better for knowledge workers, though some CEOs perceive it as lower due to collaboration concerns.
Should I expect hybrid work in Australia? Yes, hybrid models (2–3 days in the office) are increasingly common and align with employee preferences for flexibility, supported by data showing stable or improved productivity.

References:

Australian Bureau of Statistics (2025) Working from home statistics, Australia. Available at: www.abs.gov.au (Accessed: 19 February 2025).
Productivity Commission (2024) Productivity bulletin, September 2024 quarter, Australia. Available at: www.pc.gov.au (Accessed: 19 February 2025).
KPMG (2024) KPMG Global CEO Outlook 2024. Available at: www.abc.net.au (Accessed: 19 February 2025).
News.com.au (2025) ‘Australian CEOs push for office returns amid productivity concerns’, News.com.au. Available at: www.news.com.au (Accessed: 19 February 2025). [Note: This is a generalized reference based on CEO statements reported in news.com.au articles about work-from-home trends.]
Australian Institute of Health and Welfare (2023) HILDA survey: Work-from-home impacts on productivity, Australia. Available at: www.aihw.gov.au (Accessed: 19 February 2025).
Great Place to Work Australia (2021) ‘Australian worker productivity during remote work’, Great Place to Work Australia. Available at: greatplacetowork.com.au (Accessed: 19 February 2025).
Bloom, N. (2024) ‘Productivity and hybrid work: Evidence from 1,600 workers’, Committee for Economic Development of Australia (CEDA). Available at: (Accessed: 19 February 2025).
Property Council of Australia (2025) Office Market Report, Australia. Available at: www.pc.gov.au (Accessed: 19 February 2025).
CBRE (2025) ‘Australian office trends and amenities’, CBRE Australia. Available at: www.cbre.com.au (Accessed: 19 February 2025).

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