As telecommuting and flexible work arrangements become increasingly popular workplace benefits, now new research shows that such practices are paying off for both employers and employees.

For the most part, people who work remotely are not only happier than their in-office counterparts, but they feel more valued at work and report being more productive, according to new research from employee engagement firm TINYpulse. The firm surveyed 509 U.S. employees who work remotely at all times to find out about their experiences in the workplace. The report compares those workers with benchmarks calculated from responses from more than 200,000 employees across all work arrangements.

On a scale of 1 to 10, remote workers report an average work-happiness level of 8.1, compared to 7.42 for other employees. And when it comes to feeling valued by their employers, remote workers have an average score of 7.75, compared to 6.69 for other workers.

The findings from TINYpulse are significant as telecommuting becomes an increasingly popular employee perk. According to Gallup, 37% of U.S. workers say they have telecommuted, a massive increase from the 9% who said the same back in 1995. Employment site FlexJobs saw a 26% jump in remote work postings between 2013 and 2014.

“Other research has found that 37% of millennials would take a pay cut in exchange for a more flexible work schedule,” says Dora Wang, managing editor of the TINYpulse Institute. “Millennials last year became the largest group in the U.S. workforce. So it’s safe to say that using flexibility as a benefit — like health insurance or a paid gym membership — could help attract and retain young workers. And as technology improves, it’s assured that remote work will become more popular and convenient. Just over the past few years with the rise of mobile technology, people are working more hours because they have easy access to email and Slack on their phone.”

And an overwhelming 91% of respondents to the TINYpulse survey say they’re more productive when working remotely.

“Employers should stop worrying whether remote workers are being productive — our poll and others have found that they are,” says Wang. “But, they will need to be creative and proactively embrace new communication technologies in order to maintain camaraderie and culture in this new era.”

That’s important because, as the research notes, remote workers are more concerned about their relationships with co-workers. Those workers reported a lower level of satisfaction with their co-workers (7.88) when compared to the benchmark of all employees (8.47).

Additionally, 27% of remote workers say they have experienced a work-related problem because they weren’t in the same place as their team.

“The picture that emerges is one of a workforce that has the potential for high levels of employee engagement but also struggles to be connected with the rest of their company,” the report states.

To help drive connectedness, Wang says, employers should consider bringing the team together once a month for an activity, such as coffee, lunch or a group brainstorming activity.

“It’s also important to embrace technology and use it to make sure co-workers stay in touch,” Wang says. “Applications like Skype or Slack make it easy for co-workers to communicate about work. You can also use apps that improve company culture. Using a tool like Limeade, which focuses on workplace wellness, can bring employees together around something other than work.”

Interestingly enough, the happiest employees, it turns out, are those who typically work every day of the week, TINYpulse finds.

In fact, remote employees who report working seven days a week, but shorter hours, were the most satisfied of all, with an average satisfaction rating of 8.49. The next happiest were those who worked sporadic hours throughout the week, with a rating of 8.12.

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