Remote and hybrid workers earn a wage premium, Fed study finds

Employees who work from home at least part of the time earn more per hour than workers who are fully in person, according to research from the Federal Reserve Bank of San Francisco. The finding adds a pay dimension to the continuing fight over flexible work as major employers keep pressing staff to return to offices.

The San Francisco Fed study examined nearly 25,000 workers in France. Researchers used the French Labor Force Survey, company-level data and Social Security records to compare job flexibility, pay and worker characteristics.

Workers with some work-from-home arrangement earned 12% more per hour on average than employees who worked only in person, the study found. After researchers adjusted for factors including education, gender and age, the wage gap narrowed but remained at about 6%.

The San Francisco Fed researchers described the remaining gap as a work-from-home wage premium. They also said France and the United States have similar shares of employees working from home, and both countries tend to offer remote options more often in higher-paid roles held by better-educated workers.

Higher pay was tied to seniority and leverage

The study does not say remote work itself caused higher pay. The San Francisco Fed found that about half of the 12% difference was associated with observable traits such as age, gender, education and job tenure.

Researchers also pointed to less visible factors. In a blog post published by the Centre for Economic Policy Research, the researchers said workers who were working from home after the pandemic had already been earning more before remote work became widespread.

The San Francisco Fed researchers said higher productivity and stronger negotiating ability may help some employees secure both higher hourly wages and more days at home. That suggests flexible work may be easier to obtain for employees who already have bargaining power with their employers.

The result could matter for younger employees who want remote options early in their careers. The study found the wage premium was linked to workers who already held better-paid jobs before the pandemic and who may have had more influence when employers set post-pandemic work arrangements.

Remote work remains a contested benefit

The findings arrive as return-to-office policies remain unsettled. Fortune reported that Stellantis and Home Depot recently asked workers to come back to the office five days a week.

At the same time, hybrid work remains common. Zoom data cited by Fortune found that nearly 65% of workers said their offices offer some form of hybrid arrangement.

Other research has shown employees place a high value on flexibility. A Harvard University-led study cited by Fortune found participants were willing, on average, to give up 25% of total compensation to have the same job with partial or full remote-work options rather than a fully in-office role.

Research cited by Fortune also suggests flexible work may become more available as younger managers take over. The National Bureau of Economic Research found millennial and Gen Z bosses were more likely than older bosses to allow employees to work from home.

A 2024 study led by Stanford economist Nick Bloom tracked 1,614 employees at a Chinese technology company from 2021 to 2022 and found hybrid work raised job satisfaction and cut quit rates by one-third, according to Fortune. Pew Research reported in 2025 that nearly half of remote workers said they would be unlikely to stay in their jobs if they could no longer work from home sometimes.

Taken together, the research cited by Fortune and the San Francisco Fed points to flexible work as both a valued perk and a benefit more often available to employees with stronger labor-market position.

This story draws on original reporting from Fortune.