Are we going to be working from home post-pandemic?

By |2023-05-09T10:17:00-04:00November 11th, 2020|Opinions|

Certain worldwide events made Netflix our new best friend and pajamas our new favorite work outfit in 2020.

The coronavirus pandemic dramatically altered the workplace around the world. In efforts to protect employees and slow the virus’ spread, companies across the globe shifted to a remote workplace where Zoom calls and Slack messages replaced water cooler conversations and board room meetings.

In the immediate aftermath of the pandemic, some major companies — including bigtime players in Silicon Valley — are allowing its employees to work from home indefinitely going forward. As high-speed internet and the development of new software makes it easier than ever to communicate and work remotely, huge portions of the labor force are unable to pack up and work from home. All of these developments might have significant and lasting implications on the economy and the future of downtown cores and expansion projects.

So, while millions of employees may favor trotting to a home office versus sitting in traffic, the question becomes – what will the work-from-home industry look like in a post-pandemic world?

Has the pandemic changed how employees work?

According to data from a Gallup Panel in mid-April, more than half of all American workers, who account for more than two-thirds of all US economic activity, said they were working from home on a full-time basis.

The poll showed that only 26% of the US labor force had continued to work from their job’s initial location during the first month of the COVID-19 lockdown. The study concluded that only one-quarter of those working from home said they would “voluntarily” return to offices when they reopened, another quarter cited not wanting to return to office work due to virus concerns, and half said they’d continue working from home because they “preferred it.”

Research experts at the Massachusetts Institute of Technology (MIT) compared the ease of making the work-from-home transition throughout thirty countries, finding that more developed countries (Canada, Luxembourg, Sweden, Belgium) with better internet access, a mix of occupations, and pro-worker policies fared the best. Developing and middle-income countries (Brazil, Pakistan, Nigeria, China) faced more obstacles including low internet quality and intergenerational families that couldn’t make the challenging jump of working from home.

According to the MIT study, “no country in the world is fully prepared for all of its residents to work from home.” MIT says there are steps that stakeholders can take to mitigate the economic fallout of future large-scale shocks and cites Estonia’s example of digitizing government services and subsidizing internet access across the country. Superior internet connections make it easier for large pockets of the population to work from home and it means that important businesses and company services can happen regardless of its location and geography.

What does a work-from-home economic impact look like?

While remote work has been shown to increase employee productivity, the impact on the economy has been mixed. As the lines between home life and work become blurred, working remotely can lead to stress, isolation, and the dreaded feeling of ‘cabin fever.’ There are also concerns about the lack of human interaction and reduced team cohesion which come as a result of the substituted video calls instead of face-to-face connections, among other things.

Because working remotely nullifies the need to work in close proximity to a job, the work-from-home shift could lead to worsening inequality as educated, high-earning employees can swoop in from anywhere around the world and take a job that they may not have otherwise relocated to. Jody Miller, the co-founder and CEO of the Business Talen Group in California, predicts that the widespread adoption of remote work will create an increase in the “real global talent marketplace,” especially for white-collar workers. Whereas physical proximity used to be an obvious essential requirement, “now, you really are able to imagine hiring someone who doesn’t need to be on-site,” she continued.

Remote work’s effect on major cities

Because of an immense increase in the amount of work-from-home employees, experts predict that the pandemic will result in a steady decline of downtown cores throughout the world as companies will be progressively moving away from commercial real estate.

The massive shift could be felt especially hard in the tech industry, where the exodus of high-cost regions, like the San Francisco Bay Area, could become prevalent. A lot of big cities rely on tax revenue from commuters, public transit, and commercial real estate, all of which would be affected as more people continue to work from home permanently.

But, on the other side of the coin, megacities like Hong Kong, Tokyo, Seoul, and Singapore have proved (in the early months) that megacities don’t guarantee a high infection rate, as opposed to New York City.

The hybrid work model

In the end, as we’re still only eight months removed from COVID-19’s wide-felt lockdown, it seems like the most realistic approach will become the hybrid work-from-home model, resulting in a predetermined amount of time working from home and at the office.

The hybrid model, combining remote and located work, will offer the best of both worlds for both employee and employer. The hybrid option creates two fundamentally different experiences in the workforce. As businesses start to reopen their doors (with safety measures in place), working at an office helps to encourage social bonding, reinforce business culture, and an increase in business collaboration.

According to a ZDNet study, 64% of American workers want to spend “at least some hours at an office, store, factory, or workplace” in the long-term, as opposed to working from home entirely. As per the study’s respondents, enhanced cleaning protocols, reduced capacity, and daily wellness checks, are the leading strategies for employees at reopened business places. Fifty-two percent of workers, according to the study, say they’d be comfortable sharing personal information (like health data) if their company were to develop and enforce a contact tracing app to notify workers if people in the company have tested positive for COVID-19.

As the world starts to realign in a post-coronavirus world, look for more employees to start adapting to a work week that looks akin to three days at home and two at the office. While commercial real estate will still take a significant hit, expect a healthy balance between managing time remotely and on-location for millions of employees and an equally important balance of half-work weeks in PJs and half in corporate garb.

By |2023-05-09T10:17:00-04:00November 11th, 2020|Opinions|
Bruce Takefman President of Research Consultants International
CEO ResearchFDI
Bruce is a highly sought-after economic development strategist, and a regular speaker at prominent economic development events, including the IEDC Conferences, SelectUSA Canada, and EDCO Summits. His areas of expertise encompass foreign direct investment, lead generation strategies, and the implementation of cutting-edge business intelligence platforms. As an influential figure in the industry, Bruce maintains an active role in several prominent associations, such as IEDC, SelectUSA, EDCO, the Southern Economic Development Council (SEDC), Texas Economic Development Council (TEDC), Oregon Economic Development Association (OEDA), Utility Economic Development Association (UEDA), and the Washington Economic Development Association (WEDA).