No place like home for going to the office

With lower overhead, shorter commutes and more flexibility, half of U.S. businesses operate from residences

Now she thinks she’s found her dream job — with an ideal commute.

Rothstein earlier this year began a stint as an independent customer service contractor for Arise Virtual Solutions out of her Germantown home — one of about two dozen contractors the ‘‘home-shoring” call center company works with in Maryland. Arise contractors have clients such as Home Depot and Lasik Vision Institute through separate corporations that they usually start themselves.

‘‘It’s been wonderful,” Rothstein said. ‘‘I can pick my own hours to work. If I need to run an errand, I can do that. I can choose to work holidays or not work them. It gives me a lot of flexibility.”

The number of people, who, like Rothstein, work from home — either through their own businesses or telecommuting — is rising, according to recent reports from the U.S. Small Business Administration and other sources.

Roughly half of the businesses in the United States operate from home, making that total about 9 million in 2004, up from some 7.5 million in 1997, according to the SBA and U.S. Census Bureau.

Sole proprietors who claimed home office deductions on their federal tax returns in 2002 generated $102 billion in revenue, according to an SBA study released last year. And that figure probably doesn’t reflect the true number of such businesses, as many home-based companies don’t claim home office deductions or are classified in other areas, said Joanne H. Pratt, a Dallas business and telework consultant who wrote the study.

No longer a stigma

Rudy Lewis, a longtime Maryland home-based business owner and president of the National Association of Home Based Businesses, which he also runs from his Owings Mills home, estimates that there are some 23 million businesses operating out of homes across the nation. That number has skyrocketed from the approximately 1 million such businesses when Lewis helped start his organization in 1984.

‘‘Back then, owning a home-based business wasn’t something you wanted to admit to doing,” Lewis said.

At Arise Virtual Solutions, the number of home agents has grown by two-thirds in the past year to more than 4,500, said Mary Bartlett, vice president of talent management at the Miramar, Fla., company. The explosion of affordable broadband Internet service, a virtual application and training process, and signing popular clients who want to use U.S.-based contractors have played key roles in that jump, she said.

The company hopes to double its number of home agents by the end of the year.

‘‘When we started about 10 years ago, we were constrained by technology,” Bartlett said. ‘‘Our agents had to have T1 lines. ... The concept of ‘home-shoring’ snowballed as technological changes were made.”

As a result the flexibility of working at home works for many.

Beverley Williams, former president of the American Association of Home-based Businesses in Rockville who now operates a business consulting company from her home in Oakland in Western Maryland, said, ‘‘The business is doing what I want it to do, which is provide me with some extra income and give me the flexibility to be semi-retired.”

Sarah Graham, who operates The Graham Group, an accounting and auditing business, out of her Rockville home, agrees.

‘‘One of the best things is the flexibility,” said Graham, Graham, who worked for several years on government projects before starting her home-based business. ‘‘If I want to, I can work at 11 at night, after the kids are in bed.”

Working at home has other advantages, she said.

‘‘I save two hours that I used to spend in commuting, and my costs are lower because I don’t have to pay office rent,” she said.

This report originally appeared in The Business Gazette.