Working from home could be hampering innovation, according to a recent study by the University of Essex.

The research, compiled by economists in both Essex and the University of Chicago, revealed employees working remotely or under a hybrid model are less likely to generate innovative ideas compared to those always operating from an office environment.

The study observed more than 48,000 employees of a large Indian IT firm during various working periods.

Staff working from home reportedly produced lower-quality innovative ideas than their office-based counterparts.

Lead researcher Dr Christoph Siemroth said: "Innovation in the workplace can occur through random, spontaneous ‘watercooler’ conversations between employees.

"However, these ‘productive accidents’ are less likely to occur when employees work from home. Our research has found that innovation is suffering as a result."

Post-pandemic, several firms are opting for a hybrid work model, drawing concerns over innovation from business leaders.

Dr Siemroth added: "Of course, this cost to innovation may be acceptable, given the significant benefits for employees in terms of work-life balance, which makes more flexible employers more attractive.

"Our findings imply that companies should take steps to coordinate when employees are in the office.

"While this limits the flexibility of hybrid work, our results suggest that innovation benefits as a result."