Hiring challenges and low employee morale are putting pressure on agencies’ stringent return-to-office (RTO) mandates, according to new data from WorkReduce, a staffing firm that provides flexible talent to agencies and brands.

Most holding companies, which employ thousands of ad industry employees, are rolling out and doubling down on RTO policies. In August, Publicis Groupe announced a policy requiring employees to work from the office three days each week. Its leader, Arthur Sadoun, told Adweek that RTO is a crucial part of the group’s 2024 strategy.

Publicis isn’t alone. Now, almost four years since the Covid-19 pandemic started, remote work is becoming less common. More than half—52%—of the 1,000 ad industry employees who responded to a recent WorkReduce survey said their employers either expect them back in the office at least one day each week, or that they plan to.

But these policies aren’t good for employee morale and contribute to churn, survey data reveals. Those navigating RTO mandates are 40% more likely to seek new work and 96% more likely at risk for burnout than remote employees. At the same time, agencies are having trouble staffing open roles because applicants aren’t willing to go back to the office, according to Brian Dolan, CEO of WorkReduce.

“You get four times the qualified applicants for a remote role when we post them, than you do for an in-person one—even in a metro like New York where, in theory, you should have a lot of talent,” Dolan said.

WorkReduce fielded its survey in Q4 2023 and published the findings in its new Media Buying and Workforce Agility report.

Fewer candidates willing to RTO

When looking at WorkReduce’s job applicant data, Dolan found the company received 40 applications for a hybrid role, compared to 250 applications for a fully remote posting.

By Dolan’s estimate, as many as a third of WorkReduce candidates are pulling out of hiring processes and citing hybrid work policies as the reason. The number is now outpacing those who opt out of hiring processes due to compensation.

One holding company, which Dolan declined to name, has been engaging with WorkReduce to fill hybrid roles despite its RTO policy.