The Surprising Reason Remote Employees Are Getting Bigger Paychecks

A new SF Fed study shows many remote workers earn considerably more than colleagues called back to the office.

BY BRUCE CRUMLEY @BRUCEC_INC

As more companies increased the time employees are required to spend in the office each week, polls repeatedly found majorities of respondents saying they were ready to take a pay cut to retain their work flexibility. A new study shows many people don’t have to do that, because that the average remote worker earns a higher salary than colleagues called back to their cubicle.

That finding was a highlight of the “The Work-from-home Wage Premium” paper published earlier this by the Federal Reserve Bank of San Francisco. Its main and most surprising conclusion was that employees “who work from home earn on average 12 (percent) higher hourly wages than fully on-site workers.”

That discovery came as the number of businesses tightening their return to office (RTO) attendance requirements have steadily increased over the past two years — often to vocal opposition from their staffs. Meanwhile, companies like Amazon, JPMorgan Chase, UPS, Tesla, Goldman Sachs, AT&T, Home Depot and other have ordered in-person staff presence all five weekdays, sparking not just complaints, but in some cases prompting people to quit in protest.

That background is what makes the SF Fed report counterintuitive. Rather than showing employees have had to take salary cuts to retain their remote work arrangements, many are getting their flexibility cake and eating it, too — topped with the icing of more pay than many in-office coworkers receive.

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Why is that so surprising? Because a study published in late 2025 by researchers from Brown, Harvard, and the University of California Los Angeles found that on average, “individuals are willing to forgo approximately 25 percent of total compensation for a job that is otherwise identical but offers partially or ­fully remote work instead of being fully ­ in person.”

Meanwhile, a survey by employment site FlexJobs last September amid proliferating RTO rule tightening found 76 percent of participating employees said they’d “look for a new job if remote work were eliminated.” An additional 27 percent of respondents reported knowing someone who already had or was about to quit their position because in-person work requirements had been strengthened.

So how is it possible that workers who stick to their flexibility guns to keep their remote work permissions also wind up making more than those who don’t?

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