How Hybrid Work Boosted Retention: Insights from a Post-Pandemic A/B Tested Study at Trip.com, Published in Nature

The COVID-19 pandemic reshaped workplaces around the world, leading to the widespread adoption of hybrid work models. As businesses navigated the transition, a key question arose: does hybrid work truly benefit employees and companies in terms of retention and performance? A 2024 study, published in Nature, conducted a detailed examination of these issues, offering evidence-based insights into the impact of hybrid work on employees.

The Study: An A/B Test at Trip.com

The research, led by Nicholas Bloom, Ruobing Han, and James Liang, was a randomized control trial (RCT) conducted at Trip.com, a major travel technology company based in China. The trial, which ran from August 2021 to January 2022, involved 1,612 employees in the company’s Airfare and IT divisions. These employees were randomly assigned to one of two groups: a hybrid work group, which worked from home on Wednesdays and Fridays, and a control group that continued working from the office full-time.

The study aimed to measure how hybrid work affects employee retention, job satisfaction, and performance. With the backdrop of the pandemic, this experiment was timely, offering valuable insights into a widely debated topic.

Key Findings

Retention Rates: One of the most notable outcomes was that hybrid work reduced employee attrition by 33%. The flexibility of working from home two days a week led to significantly lower quit rates compared to the control group. This effect was particularly strong for non-managerial employees, women, and those with long commutes, with female employees experiencing a 54% reduction in quit rates.
Job Satisfaction: Employees in the hybrid work group reported higher job satisfaction, including improved work-life balance, life satisfaction, and work satisfaction. They valued the ability to work from home, citing reduced commuting time and the flexibility to handle personal matters during the day as key benefits.
Performance and Promotions: Contrary to concerns that hybrid work could hinder productivity or career growth, the study found no significant difference in performance reviews between the hybrid and control groups over two years. Similarly, promotion rates were unaffected by the hybrid work schedule, indicating that working from home did not impede employees’ professional advancement.
Perception of Productivity: The study also measured shifts in perceptions of productivity. At the start of the trial, managers were skeptical of hybrid work’s impact, predicting a 2.6% decline in productivity. However, by the end of the experiment, managers’ views had shifted positively, aligning with the non-managers' generally favorable perception. Both groups eventually reported a modest increase in perceived productivity.

What Businesses Can Learn

This study provides clear, data-driven insights for organizations considering or currently employing hybrid work models. The findings suggest several important takeaways:

Cost Savings: Reduced employee turnover, particularly among highly skilled professionals, can result in significant cost savings. For Trip.com, each departure was estimated to cost around $20,000 in recruitment and training expenses. The study’s 33% reduction in attrition represented millions of dollars in savings.
Employee Satisfaction and Retention: Offering hybrid work options enhances job satisfaction, especially for employees with long commutes and women, who may place a higher value on the flexibility to work from home. In a competitive labor market, hybrid work can be a key differentiator in attracting and retaining talent.
No Detriment to Performance: The study’s null results regarding performance and promotions provide evidence that hybrid work does not harm productivity or career progression. Companies can confidently implement hybrid models without fearing adverse effects on employee output.
Leadership's Role: The shift in managerial attitudes highlights the importance of leadership engagement. Initially, managers were more resistant to hybrid work, but their views changed after experiencing its positive effects. This suggests that A/B testing, like the one in this study, can be a useful approach for organizations to evaluate new work arrangements and address management concerns.

A Broader Context

While the study was conducted at Trip.com, a large Chinese technology company, the results have broader implications for organizations worldwide. Hybrid work is already being embraced by millions of employees across North America and Europe. The research highlights how companies in various industries can use data to refine their work-from-home policies and achieve a balance that benefits both employees and the organization.

Conclusion

The 2024 study at Trip.com, published in Nature, presents a compelling case for the benefits of hybrid work. By offering flexibility, companies can boost employee satisfaction and retention without sacrificing productivity or career development. As the workplace continues to evolve post-pandemic, this research provides a clear and actionable roadmap for businesses looking to embrace hybrid work models.

Reference

Bloom, N., Han, R., & Liang, J. (2024). Hybrid working from home improves retention without damaging performance. Nature, 630, 920-925.