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WFH: When small savings risk larger costs

Tong Kooi Ong + Asia Analytica
Tong Kooi Ong + Asia Analytica • 3 min read
WFH: When small savings risk larger costs
Several countries — including Malaysia, Myanmar, Laos, Indonesia, Egypt and Thailand — have introduced work-from-home (WFH) policies, particularly for public servants. Photo: Bloomberg
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Several countries — including Malaysia, Myanmar, Laos, Indonesia, Egypt and Thailand — have introduced work-from-home (WFH) policies, particularly for public servants. Meanwhile, Pakistan, the Philippines and Sri Lanka have introduced a one-day shorter work week for public officials. In contrast, most advanced and highly productive economies — such as the US, China, Singapore, Germany, Japan, South Korea and Taiwan — have adopted measures other than WFH, despite facing similar or higher fuel costs (see table).

The difference is not exposure to rising costs, but how short-term savings are weighted against long-term institutional performance.

It is also important to distinguish context. WFH during the Covid-19 pandemic was not an economic choice but a public health necessity. Extending it into normal conditions requires a different justification.

The economic case for WFH today centres on cost savings — fuel, tolls and daily expenses — as well as the government’s subsidisation of petrol. These savings are real and, for some households, significant. In many cases, however, they represent modest gains relative to overall income. In addition, we should take into consideration the loss of revenue for businesses such as F&B that cater to the office crowd.

But the more important question is whether these savings justify broader organisational trade-offs. Workplaces are not merely sites of individual output; they are systems of coordination, communication and shared problem-solving.

Much of the value comes from proximity — faster decisions, clearer alignment and informal exchanges. Remote work, while efficient at the individual level, often introduces friction at the organisational level.

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Over time, coordination can become more rigid, communication more fragmented and accountability less clear. Standards may drift, urgency can wane and comfort risks replacing performance.

There are also longer-term considerations. Learning within organisations is often informal — through observation, interaction and exposure. These are difficult to replicate remotely. Culture, too, depends on consistent engagement. Without it, cohesion and shared expectations erode.

WFH during Covid-19 also reset expectations. What began as a necessity can evolve into entitlement, making reversals difficult.

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None of this suggests WFH has no role. Many organisations benefit from hybrid models that balance flexibility with the need for collaboration. But effectiveness depends on the nature of the work, organisational structure and operational demand — not broad, one-size-fits-all rules.

This is particularly relevant when considering extending such policies to the private sector. Businesses operate under diverse constraints — competitive pressures, client demands and differing cultures. They are best placed to determine what maximises productivity. Standardised work arrangements risk ignoring these realities.

Ultimately, both labour and employers make choices. Employees seek environments that suit them; firms design conditions that support performance. The balance is market-driven, not centrally prescribed.

In policymaking, visible short-term savings can obscure larger, less visible costs. The challenge is to ensure that, in addressing immediate concerns, we do not inadvertently undermine long-term effectiveness. Because those costs, once embedded, are far harder to reverse.

Caveat: This article is written on the basis that Malaysia has sufficient energy supply, including RON95 petrol, and faces no imminent shortage for domestic consumption

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