Return to Office Mandates and Brain Drain

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2024-11-26 19:00:07

By tracking over 3 million tech and finance workers' employment histories reported on LinkedIn, we analyze the effect of S&P 500 firms' return-to-office (RTO) mandates on employee turnover and hiring. We find that these firms experience abnormally high employee turnover following RTO mandates. The increase in turnover rates is more pronounced for female employees, more senior employees, and more skilled employees. Further, it takes significantly longer time for these firms to fill their job vacancies after the mandates. Their hire rates also significantly decrease. These results are consistent with firms losing their best talent and female employees and facing greater difficulties with talent attraction after RTO mandates. Our study highlights brain drain as a significant cost of RTO mandates even for the largest firms in the world.

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