How We Work

November 29, 2021
Dow: 35,136

For those of us who have “desk jobs,” COVID-19 changed the way we work, and we probably will never go back to how and where work was done in 2019. The implications are significant for almost every aspect of our economy. As a nation, we have become more productive, and report that our lives feel more balanced.

More than 18 months after the initial shutdown from COVID-19 in March of last year, only a fraction of white-collar employees have returned to the office in many major cities. Kastle Systems International is the major provider of card swipe systems for office access that have become ubiquitous in most cities. They collect data from 2,600 buildings in over 130 cities around the country. They show that New York City card swipes are down 52% from pre-pandemic levels. In San Francisco, swipes are down 57%. Chicago figures are comparable. New York subway ridership is below 50% of pre pandemic levels, and that is after recovering from levels that were far lower. Kastle Systems’ weekly index of U.S. metro areas currently shows that employees are still going to the office only an average of two days per week. As one would expect, southern states with more liberal reopening policies show a higher in-office presence, but still substantially lower than two years ago. It is fair to say that a significant portion of the workforce has settled into some type of hybrid work routine.

A hybrid environment lets individuals have the best of both worlds – no commute and none of the commensurate costs and hassles. It still allows collaboration through messaging and video apps, and in-person collaboration on in-office days. As many jobs have evolved into an interface between an individual and a terminal or computer, being “together” has become less of a priority.

The implications for both cities and less densely populated areas are significant. Large coastal cities and other major population centers may see a material plateau or decline in values for both commercial and residential real estate. The tax base will decline for sales, real estate, and income taxes. This will be a major funding issue for these areas. Service sector jobs that supported the urban commuter will disappear. Demand for support services in suburban or rural areas will increase, as new services will be needed for those working from home. The $1.9 trillion American Rescue Plan passed earlier this year funneled massive grants to municipalities, but this was a one-time funding. Cities that experience permanent population declines will experience declines in quality-of-life issues.

Many employee surveys have shown that most employees want to continue to work under a hybrid office/remote schedule. We all were forced into it last year, adapted to it, and don’t want to completely give it up. The reason many want a blend is that they see the benefits of both. We shouldn’t push too hard against this change; the experiment will allow us as a group to find the proper equilibrium. It has encouraged a more rapid rate of job change as well; resignations are at record levels, as individuals reassess their priorities and think about how they want to work. Economically, it has been for the better. GDP is at record highs, even with a smaller aggregate workforce. A satisfying and rewarding work life helps us all to live happier and more rewarding lives.

 

Random thought:  “The only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle.” -Steve Jobs

“Look for the job that you would take if you didn’t need a job” -Warren Buffet