German employers regularly poach employees from companies with rigid regulations by offering flexible working models. For example, 75 percent of HR managers say that in the last six months they have lost employees to companies that are less tied to fixed working hours and locations.
At the same time, 87 percent report an increased demand from employees for more flexibility. These results are based on a study by Remote in collaboration with Censuswide of more than 4,000 executives in ten countries – including over 500 in Germany.
Although the economic situation is tense at the moment, 73 percent of all companies worldwide report that their number of employees has increased in the past year. In an international comparison, Germany is the frontrunner (*), with 86 percent of companies reporting growth. In the United Kingdom, 81 percent reported growth, compared to only 72 percent in the United States.
The study also shows that German companies are resorting to flexible employment relationships. 42 percent of companies are increasingly relying on contractors and freelancers – 42 percent of whom are hired abroad.
Flexible work boosts productivity and business performance
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Higher productivity (50%) and better business performance (34%) are among the key benefits attributed to a location-independent working model by respondents in Germany. This contrasts with the perception of well-known companies that recently brought their employees back to the office, citing productivity as the reason for their decision.
When asked how location-independent work affects employees, half (50%) of German companies said it increases employee satisfaction, and 47% emphasized that working from home is crucial for a better work-life balance for employees. In addition, German companies that prioritize location-independent work report lower employee turnover (27%) and access to a larger talent pool (27%).
The challenges of high flexibility
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Despite the many advantages of flexible working for both companies and employees, it is not without its challenges. The biggest issues cited in the study relate to compliance with international labor laws. 74 percent of German companies that work remotely have experienced this in the last six months alone.
Other challenges include managing decentralized teams (82%), increased costs associated with implementing software for global collaboration (80%), and assessing whether global talent fits into the team (78%).
On the other hand, however, almost the same number of companies (79%) have been able to save on office space by successfully implementing remote or hybrid models.
Job van der Voort
“We are still in the early stages of establishing the foundations for location-independent work – now we need to identify and overcome the challenges,” explains Job van der Voort, CEO and co-founder of Remote. ”Our study reflects what we are hearing from many of our customers: the benefits of flexible and decentralized work far outweigh the challenges. We believe that remote and flexible working on a global scale paves the way for a more successful, balanced and equitable business world. That’s why we want to support other companies in adopting flexible working models to attract great talent from around the world.”
The complete Remote Workforce Report 2024 is available for download here.
Methodology
Remote commissioned research firm Censuswide to survey a nationally representative sample of 4126 C-level and senior HR decision makers in August 2024 across the U.S., U.K., Germany, France, Netherlands, Sweden, Spain, Australia, South Korea, and Japan, including 501 in Germany.
* That may change. This survey is from August 2024. In October 2024, the German IAB labor market barometer recorded the first decline in six months. Compared to the previous month, the leading indicator of the German Institute for Labor Market and Occupational Research (IAB) fell by 0.4 points to 100.3 points. By contrast, the European Labor Market Barometer stagnated in October at 99.5 points in the slightly pessimistic range. The IAB labor market barometer is a leading indicator that has existed since November 2008 and is based on a monthly survey conducted by the German Federal Employment Agency among all local employment agencies.
