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Post-Covid Telework and Productivity: A Large Scale Analysis

Author

Listed:
  • Askenazy, Philippe

    (Centre Maurice Halbwachs (ENS-PSL, EHESS, INRAE, CNRS), Insee and IZA)

  • Di Nallo, Ugo

    (Insee)

  • Ramajo, Ismaël

    (Dares)

Abstract

This paper studies the causal impact of post-Covid telework on firm productivity in France, where hybrid work has become the dominant form of telework. Using matched survey and administrative data on over 6,500 firms employing three million workers, we test whether telework in 2022 relates to productivity growth from 2019 to 2022 excluding agriculture, finance and insurance, and real estate. OLS estimates show a modest positive link: a 10-percentage-point rise in telework share correlates with a 0.7-1.0 percentage-point productivity gain. To address endogeneity, we use an instrumental variable based on pre-pandemic office surface per employee in rented separate office spaces, which likely facilitated telework adoption and cost reductions. The instrument is strong, and 2SLS results indicate a sizeable LATE: a 10-point increase in telework raises productivity by about 2.7 points. Firms with separate offices also reduce obsolete space and slightly increase office equipment, suggesting additional productivity channels beyond real-estate adjustments.

Suggested Citation

  • Askenazy, Philippe & Di Nallo, Ugo & Ramajo, Ismaël, 2026. "Post-Covid Telework and Productivity: A Large Scale Analysis," IZA Discussion Papers 18655, IZA Network @ LISER.
    • Handle: RePEc:iza:izadps:dp18655
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    Keywords

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    JEL classification:

    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation
    • J81 - Labor and Demographic Economics - - Labor Standards - - - Working Conditions

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