Who is working at home?

1.5 million work at home with computer and phone link to employer or client Seven out of ten teleworkers are men Over a quarter of all teleworkers work in the business and financial services sector Teleworkers are likely to be graduates, married and in mid-career Source: IES analysis of Labour Force Survey 2000

Last year, about 1.5 million people or 5.5 % of the UK workforce fell within this definition of homeworking, according to the Institute of Employment Studies (IES) analysis of the Labour Force Survey. This was a 19% jump on the previous year's figures

This definition covers people who work mainly in their own home at their own job, people who work in various locations, using their own home as a base, or people who work at home at least one day a week.

Some people find it more stressful working at home, partly because of the isolation

Dr Sandi Mann, work psychologist

An estimated 1% of the workforce worked in their own home in their main job last year.

Advantage for business

Part of the reason for the increase in home working is the huge savings businesses can make.

It is an incentive for people to stay with that company, said Ursula Huws, author of books on teleworking and director of the Emergence project, an international study of e-work funded by the European Commission.

"All other costs pale into significance beside the cost of recruiting and retaining a skilled a valued person," she added.

Most teleworkers are in senior jobs, likely to be graduates, married and in mid-career. The fastest expanding teleworking occupation is management, with an increase of 25% in managers working from home.

Businesses can also save on office space, lighting and heating, but these savings are not always realised, unless they choose to downsize to another office.

Since BT started to encourage its staff to work at home in 1992, it claims to have saved �180m in property costs.

The debt-laden telecoms company currently has about 7,500 of its 130,000 employees based at home, without a permanent desk at BT, while about 47,500 of the workforce have remote access to systems.

The average cost per desk in a UK building is between �6,000 and �19,000.

There is a huge hidden subsidy to the employer

Ursula Huws, teleworking consultant

"I would be surprised if any organisation said it cost them more than �3,000 to set someone up at home,"Peter Jones, business development manager at BT Workstyle Consultancy said.

Part of the reason employers are taking it up is the aging population means that as fewer young people join the workforce, it becomes more important to attract or retain or attract older staff, he added.

Cost to employee?

But some could argue that cost savings to the employer are at the end of the day picked up by the employee.

"Which ever way you cost it, no employer is going to pay that much to a homeworker as rent for their spare room. There is a huge hidden subsidy to an employer," Ursula Huws said. "For a young person in a London flat, providing that kind of space is a hidden cost."

While the employee also saves on the cost and time of their commute, without regular contact with the office, they could get demotivated and paranoid.

"It is not the wonderful thing it is always made out to be," University of Central Lancashire's work psychologist Dr Sandi Mann said. "What people thought originally is that people would be working at home all the time. The way forward is people working at home a couple of days a week. That is increasing."

"Some people find it more stressful working at home, mainly because of isolation, both emotional and technical," she added.

The workers who are in the office can resent those at home, who don't do their share of office duties, such as training new staff and picking up other people's phones.

New employees could also feel out of touch with corporate culture and this could lead to widely varying standards.

"If you are sitting in an office next to other people, you get a feel about how you deal with a particular case," Ursula Huws added.