Yesterday, I mentioned that occupancy rates hit 62% of their February 2020 average. Let’s examine that landscape a bit more.
A study found that return-to-office (RTO) mandates did not improve a firm’s financial metrics but decreased employee satisfaction. The analysis of S&P 500 companies showed that RTO mandates were linked to firms with male CEOs who had greater power in the company. The study suggested that RTO mandates may be used to reassert control over employees and blame them for poor firm performance. Unsurprisingly, RTO mandates were associated with declines in overall job satisfaction, work-life balance, senior management, and corporate culture.
A survey by FlexJobs found that half of American workers are willing to take a pay cut for the opportunity to work remotely. Many workers are also willing to give up vacation days and increase working hours for remote work. The survey also revealed that workers are willing to forego other benefits, such as professional development opportunities and company-provided insurance. Millennials were most willing to give up something for remote work, followed by Gen X and boomers. Workers are also willing to relocate for remote work, with lower living costs, climate, and culture being motivating factors. The share of workers living far from their offices has increased significantly, and the desire for remote work has remained strong despite layoffs in industries that offer virtual opportunities.
Remote workers are at a higher risk of being laid off or missing out on promotion opportunities than their in-office counterparts, potentially exposing employers to discrimination lawsuits. Studies show that remote white-collar workers were 35% more likely to be laid off and 31% less likely to be promoted.
Dell has changed its promotion policy for remote employees, requiring them to work at an approved office at least three days a week to be eligible for promotions. This shift contradicts the company’s previous support for remote work and goes against CEO Michael Dell’s belief that in-office work is unnecessary for a good company culture.
And in all this change, Business Insider covers landlords considering alternative uses for the space. Explored options include hotels, advanced manufacturing facilities, film studios, and medical offices. While residential conversions are still the most profitable choice, there are financial and physical hurdles to repurposing office spaces. Warehouses may be a viable option for large office spaces.
This might all be political, too. A survey shows that the subject has become unnecessarily politicized, and many believe that companies are out of touch for focusing on “back-to-office” protocols. The issue is emotionally charged due to its connection to the COVID-19 pandemic, and questions of fairness and power arise. The debate often cleaves along familiar divides, with remote workers typically being college-educated, urban employees, while those unable to work remotely are more likely to be front-line workers. Recruiters warn that willingness to come into the office has become a factor in hiring and layoffs.
Why do we care?
Opportunities exist in areas ripe for disruption. In technology services, we are looking for that. Additionally, the high value of technology consulting helps customers maximize their technology investment.
That’s why work dynamics, remote work, hybrid work—whatever you call it—are opportunities.
Data shows that imposing RTO mandates is detrimental. However, firing staff remotely without policies and support is also detrimental. So, there is work to guide here.
And note there will be a window to this. Consider this – as office leases come up for renewal (and potentially don’t get renewed), and as landlords find other uses to move commercial real estate to, there will be a shift. What can you do to take advantage of that shift?
A critical insight is that the issue is politicized. To avoid the mess, strive for transparency and inclusivity in decision-making processes.
