Work from Home Gets Entrenched: Embraced by Workers & Businesses in the UK, it’s Upending Real Estate, Retail, Restaurants, Bars, Cafés

“The contract between society and business has changed forever. The office will become a convening place where you get teams together, but the work will be done in people’s homes.”

By Nick Corbishley, for WOLF STREET:

One of the UK’s largest outsourcing companies, Capita plc, which employs 45,000 people across the country, has just done what many other companies have been thinking and talking about doing since the virus crisis began: it announced that it is permanently closing more than a third of its offices. As a result, the leases on almost 100 workplaces will be terminated.

Like many large outsourcing companies in the UK, Capita has been struggling for years. It did not collapse and get liquidated like erstwhile giant Carillion but its share price has collapsed 97% since 2015. Even before the virus crisis began, the firm was exploring ways of slashing costs, including embracing more flexible working practices such as work from home, which the lockdown pushed to the fore. The company says that employees are firmly on board with the changes.

“Following dialogue with our employees it has become very clear that they would like to work in a more flexible way, which will involve increased working from home, but they will still spend a significant amount of their time working from offices that are based in the heart of our local communities.”

Although the office may not have completely lost its raison d’être, its role has changed dramatically, says Capita’s CEO Peter Harrison: “The contract between society and business has changed forever. The office will become a convening place where you get teams together, but the work will be done in people’s homes.”

A large number of British workers appear to be happy with this new reality. A recent study by researchers at Cardiff University and the University of Southampton found that 88% of employees who worked at home during lockdown would like to continue doing so in some capacity, with 47% wanting to do so “often” or even all the time.

The explosion in working from home sparked by the lockdown has mostly affected higher paid, better qualified workers, in particular those living in and around London. According to the study, their work hasn’t suffered much as a consequence of the change. Around 41% of the workers surveyed said they got as much work done at home as they did before the lockdown; 29% said they got more done at home, while 30% said their productivity had fallen.

The UK continues to significantly lag behind mainland Europe in getting workers back behind their desks. Analysis by the Center for Cities think tank found that just 17% of working people had returned to work in the UK’s 63 largest cities by early August — unchanged from June when the lockdown started to lift. If you include smaller towns, roughly a third of white-collar workers had returned as of mid-July, half the proportion as the rest of Europe, according to Morgan Stanley. In France 83% of white-collar workers had made it back to the office, while in Italy it was 76%.

Here are three reasons I can think of why WFH is still so dominant in the UK:

1. Avoiding commuter hell. Commuting is not much fun in most places, but it’s particularly hellish in the UK. And loads of people do it: 48% of the workforce living in and around London commute to and from work — more than any other EU region, according to Eurostat’s last report, published in 2016. And they pay through the nose for the privilege, shelling out up to five times as much of their salary on commuter passes compared to the rest of Europe.

In most cases, the higher prices do not correlate to quality. Overcrowding, regular cancellations, poor punctuality, safety concerns and ever rising prices are a constant feature of rail travel in the UK. Driving is also hugely expensive, especially in London where drivers face a £15 congestion charge.

People working from home now have a lot more time on their hands as well as more money in their pockets. With so much uncertainty on the horizon, not to mention the threat of catching covid on the way to work, is it any wonder that they would rather keep toiling from the relative comfort of their own home?

2. The lockdown lag. Thanks to the government’s flip-flopping at the height of the pandemic, the UK went into lockdown later than most of its European counterparts. It also emerged a few weeks after most other countries. As such, it could be argued that UK workers are slightly behind the curve in their return to work, though the lack of progress since the lockdown was lifted might suggest otherwise.

3. School still out. Unlike some places in Europe, such as Germany, children in the UK are only just beginning to go back to school. By the end of this week, most schools will be back in action, freeing parents up from their diurnal childcare duties and allowing them to finally venture back into the office, which they will duly do in droves. At least that is what the government and many business associations are banking on.

4. Many UK businesses embrace WFH. They stand to reap significant cost savings, particularly on office rents. They’re also fearful of being sued for damages if a worker does catch the virus on their premises.

A recent BBC study found that 50 major UK employers had no plans to return all staff to the office full time. A couple of weeks ago, the investment firm Schroders, which opened a new 260,000 square foot state-of-the-art facility in central London in 2018, became the first UK company to tell its workers that they can work from anywhere, as long as they work their contracted hours and days.

This flies in the face of recent government pronouncements that workers need to return to the office as quickly as possible. But with the virus still doing the rounds, it can’t even get its own workers to comply. According to The Times of London, just one in ten officials have returned to two of the government’s most senior departments, largely due to resistance from unions amid fears that a second wave of infections is around the corner.

As office workers stay away from the office, whether out of choice or company policy, the businesses that traditionally depend on their custom — the cafes, restaurants, bars, hair salons, retailers, travel companies and the like — are falling through the cracks. One of the biggest high street food establishments, Pret a Manger, has unveiled plans to cut 2,900 jobs amid slumping sales.

Between March and June, London’s hospitality sector lost £2.3 billion in foregone lunches and after-dinner drinks, according to the Centre for Economics and Business Research (CEBR). If the WFH revolution becomes a long-term fixture, almost half a trillion pounds in lost output could be wiped out over the next five years.

Commercial property owners are feeling the heat. According to the latest edition of CBRE’s Central London Office View, take up of new office space in Central London slumped to 331,100 sq ft in July, down 43% from the June total and 79% on the July 2019 total. There were just 19 transactions during the month, the lowest number seen in over 20 years. In Central London, the vacancy rate rose to 5.7%, from 5.2% in June, the highest level since 2010.

No one in the sector is immune from the fallout. Property development and investment giant British Land, a 164-year old bastion of the British establishment, is on the verge of suffering the ignominy of falling off the FTSE 100 after its shares tumbled 40% so far this year. They are down 75% from their all-time peak in 2007. Its long-standing rival, Landsec, until recently the UK’s biggest property owner, is not far behind. Their combined market cap is now dwarfed by Segro, the UK’s biggest warehouse owner and — thanks to the boom in ecommerce — one of the beneficiaries of the current crisis. By Nick Corbishley, for WOLF STREET.

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  99 comments for “Work from Home Gets Entrenched: Embraced by Workers & Businesses in the UK, it’s Upending Real Estate, Retail, Restaurants, Bars, Cafés

  1. Lou Mannheim says:

    If this does stick, I wonder what this means for people who derive their power from face to face interactions. It could make for an interesting, Darwinian moment for humanity.

    • Inno says:

      I’ve seen this firsthand in the company I work in. People who get paid for what amounts to ensuring others are showing up to do their individual contributor tasks, are decreasingly relevant.

    • SaltyGolden says:

      I’ve thought about this, the value of being good looking goes completely out the window. Though I think extroversion certainly still translates when face to face unplanned interactions are no longer a tool. You’re still that much more likely to place a random phone call to a colleague you don’t know well or facilitate a meeting with confidence.

      I know a guy who’s job it is to make sure people show up to work (logon now). Interestingly he’s still employed just has different tactics.

      This is a good thing.

    • nodecentrepublicansleft says:

      When I started leasing land for cell towers in 1998, you had to meet people in person, shake their hands and look them in the eye.

      By 2008, I had finally leased a site without doing any of those things since I was in FL and property owner was in Michigan.

      “In person” is a bit overrated. If you’re competent at what you do, it’s almost entirely unnecessary for many jobs. I’ve worked from home for 20 years.

    • Rand Passmore says:

      Darwinian? A huge leap toward what? Will it be more revolutionary than evolutionary? Change sociology and psychology and even the physical structure of our brains? What to do with all the office and retail buildings? Will automobile sales tank? Will it accelerate change in the way we view the world and EVERYTHING ELSE?

    • Mira says:

      Yes ..
      We don’t really have any idea how it will all come together again & what shape it will form.
      I suspect that it is the beginning of a new beginning not contemplated yet.

  2. Inno says:

    Wow, playing this forward, the entire structure of Real Estate value gets upended. Here in CA (probably everywhere), one effectively “buys one’s commute” in terms of residential pricing…there really is no other justification for the price structure, price rises as one gets closer on the corridors to the major cities (except where schools create a factor). The causal elements outlined in this article hit far more than commercial RE. “Dislocation” fails as a word here.

    • Rob says:

      Yes, this is not a bear market, its an industry regime shift.

      I was at Guinea Grill last night off Berkeley Sq. It was at about 25% of what would have been expected normally. Normally the street there is rammed after work. And September is busy compared to what July and August looked like.

      The way out will be PDR conversion of Class C buildings into residential in the centre.

      • Peter says:

        I think that’s right. Otherwise ghost towns. But planning needs to be overhauled first.

        • Mira says:

          In days gone by .. work was just a few streets away or a little further & not a million miles away.
          Tradies travelled .. the plumber etc.

  3. Anthony A. says:

    This is setting the stage for employees becoming 1099 contractors (or similar in the U.K.). Good for employers, not so good for the WFH crowd.

    • GotCollateral says:

      llc in a caymens for invoices, live in a cheap country, bill under the foreign income tax exemption… maintain citizenship… going on 5 years… yawn

      • Zantetsu says:

        Tax dodging is repulsive. You should at least be paying taxes where you live so that you’re not freeloading off of the tax payers around you.

        • GotCollateral says:

          VAT’s are the extent i get taxed locally sans visa… paying for what I use… not for what some bureaucRAT thinks my work/time should be put towards paying.

          If one doesn’t agree, why should one pay? And I don’t believe in that political sisyphean ballot box nonsense that has normalized rolling from one train wreck to the next to continue to fuel MIC and zombie companies alike. Voting with my feet has been way more effective for me and my wife.

          Democracy in the 21st century needs less focus on elections and feeding the rats with their ponzi pension schemes sprinkled with electoral bribery and more focus on automated tools that enable people to engage in distributed consensus and decision making (and transparent tracking of said resources tied to such) in their communities for me to want to engage more with my time/effort and resources.

          The moral high ground that you think you stand has been underwater for a long time…

        • Tom Pfotzer says:

          Zantetsu, or anyone else:

          Please rebut GotCollateral’s points:

          a. The taxes we pay, esp. at national level, are not well-spent, and the political game is so rigged and corrupt that it can’t be changed

          b. The alternative at the individual level is to find legal ways to not pay into a rigged system

          GotCollateral: I hope you are in the business of “automated tools that enable people to engage in distributed consensus and decision making”. You sound like someone that could make a great contribution to that endeavor.

          Corona has done us at least one great service: it’s untethered the worker – physically – from the office.

          We now move the work to the worker (and that work is electrons, which are very light) rather than moving the worker (heavy, including 3000Lb auto) to the office (second, redundant structure to HVAC and amortize).

          Good move.

        • Paulo says:

          Zan,

          Some people are takers are some contribute.

          Justifications are interesting to read, but it always comes down to my first sentence. If VATs become exclusive for funding services then the same people complain about the fees and levies that pay for roads, schools, hospitals, transit etc etc.

        • VintageVNvet says:

          Paulo,
          You may want to take a good look at your post this morning, and maybe decide not to post before your morning cuppa???
          Just saying, not up to your usual clear communications.
          BTW, not claiming any perfection on that score either..LOL.

      • topcat says:

        A true libertarian. I suppose you don’t use any other local resources like roads or water supply or electricity or hospitals or, well anything really. I think this is called the free-rider problem. When everyone takes your attitude and free-rides then after a while you don’t have much of a place anymore.

        • wkevinw says:

          The “free rider” problem is indeed when somebody gets more of a government product than they pay for. For a legitimate service, everybody should pay their fair share, obviously.

          The lists of what libertarians want as legitimate government services is usually made sloppy/too long for drama. It’s obvious (has been in textbooks for decades) that “line” industries/services have to be at least partially government controlled- certainly roads/transport lines, line utility rights of way. The list is actually pretty short.

          Hospitals can very easily be private. Even fire fighting can be private. It’s open to debate and details of the local- emphasize local- market conditions. Limiting Central/Federal one-size-fits-all, is exactly what gives the US economy its flexibility and advantage over many others.

        • GotCollateral says:

          And all of the stuff is tiny fractions of the graft people willingly submit too… Well, some people…

        • Mira says:

          After the 2008 GFC it was said ..
          “But for black money”
          It is black money that is the blood flow in a nations economic veins & thus it thrives.
          The top few % do not pay tax & spend in their own back yard .. if the economy of a nation were to rely on their financial ‘tips’ it would die.

      • Wolf Richter says:

        GotCollateral,

        Obviously, you’re not American: US citizens and green-card holders are required to pay US income taxes on income they earn globally, no matter where they live.

        Sure, there are ways not to pay US income taxes, but that’s veering into tax fraud.

        If you’re wealthy/high income, better to use the immensely complex and unfair US tax code to your advantage, stay legal, and still don’t pay a lot in taxes in the US :-]

        • Rand Passmore says:

          Frankly It is simply good morality to pay your taxes. We are all in danger of becoming moral pieces of turd and our societies,environment and everything else will go to hell in an up and downward spiral and we won’t like what the future will become. We need good ethics and morals.

        • wkevinw says:

          A well-known danger of inefficient, corrupt and over-taxed populations is that people will dodge taxes. This has been a subject of many studies in economics. See Greece and some other European countries.

          The government has a very important role to play in keeping the taxes well spent and at a reasonable level. If not, they are playing with fire.

        • Keith says:

          There are exemptions, I think up to $80-90k or so, provided you work for a foreign company and you reside outside the US. For everyday you are in the US, you lose a part of that exemption. If you sepnd more than 30 days in the US, you lose it entirely. I recall this from being an overseas contractor during the Iraq war. Granted, for many that is not a lot of money, but for me it was very nice.

        • Tom Pfotzer says:

          Rand:

          Yes. Morality and ethics are decidedly an advantage to a society. This is what makes the corruption at the national level so pernicious.

          They get away with Grand Theft right in plain sight, and the little guy wonders “how come”.

          Please continue to direct outrage @ the correct, huge, egregious targets.

        • Keith says:

          Here is a snippet from the IRS website:

          Foreign Earned Income Exclusion

          If you meet certain requirements, you may qualify for the foreign earned income exclusion, the foreign housing exclusion, and/or the foreign housing deduction. To claim these benefits, you must have foreign earned income, your tax home must be in a foreign country, and you must be one of the following:

          A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,
          A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or
          A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

          You can use the IRS’s Interactive Tax Assistant tool to help determine whether income earned in a foreign country is eligible to be excluded from income reported on your U.S. federal income tax return.

          If you are a U.S. citizen or a resident alien of the United States and you live abroad, you are taxed on your worldwide income. However, you may qualify to exclude your foreign earnings from income up to an amount that is adjusted annually for inflation ($103,900 for 2018, $105,900 for 2019, and $107,600 for 2020). In addition, you can exclude or deduct certain foreign housing amounts.

          You may also be entitled to exclude from income the value of meals and lodging provided to you by your employer on their premises and for their convenience. However, such amounts are not foreign earned income. Refer to Exclusion of Meals and Lodging in Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad, and Publication 15-B, Employer’s Tax Guide to Fringe Benefits for more information.

        • Wolf Richter says:

          Keith,

          All the Foreign Earned Income Exclusion does is avoid DOUBLE TAXATION on part of your income, because you have to pay taxes in your host country and in the US. Anything above the Foreign Earned Income Exclusion is taxed twice, once in your host country, and once in the US.

          I spent a few years on that program in Belgium, paying Belgian income taxes on my Belgian income and paying US income taxes on my global income minus on the Foreign Earned Income Exclusion.

        • GotCollateral says:

          > If you’re wealthy/high income, better to use the immensely complex and unfair US tax code to your advantage…

          Kind of making my point here Wolf… Yup better be a participant in the scam than not… after everything you talk about on here… hahahaha

          > Obviously, you’re not American: US citizens and green-card holders are required to pay US income taxes on income they earn globally, no matter where they live.

          Yeah, just like all the folks US citizens in the panama papers follow said requirements… and a sure mark of whether you are a citizen is by abiding by every single rule someone somewhere ever made…

          No True Scottsman kind of argument eh? You have my info, I ordered mugs from you… you can do your own research, wont change anything from what I said earlier…

        • Wolf Richter says:

          GotCollateral,

          Thanks for buying the mugs, but that was the company (Design-a-Shirt) you dealt with that is selling those mugs. I don’t see any of this data. And so I don’t know anything about you. And I cannot look it up either.

          If I said the wrong thing, apologies. I was just extrapolating this “not American” from what you said.

        • Mira says:

          In Australia .. HARD EARNED TAX PAYER DOLLARS are thrown every which way & loose.
          example:
          Hundreds of millions of dollars are fed into the public hospital system in Victoria .. my state & the public hospital system does not work.
          2017 .. $18 million vanished from St Vincents Hospital, Fitzroy .. & in their arrogance the takers didn’t even bother to write it up .. $1 million for coffee
          .. $1 million for toilet paper & so on.
          The thinking was .. they will never look / we will look them in the eye & lie / prove it !! ..
          No one was held to account it was just forgotten as it every other time.
          HARD EARNED TAX PAYER DOLLARS taken for granted.

      • Ellie says:

        @GotCollateral,
        Kudos to you! Taxes are my pain peeve, though, I haven’t figured out how to circumvent the systems as nicely as you have.

    • TimTim says:

      Very good point. Massive savings to be made out of reduced holiday entitlement, employer pension contributions I suspect.

      In a poor jobs market it may also prove easier to implement.

      A middle class gig revolution…

  4. Alberta says:

    5g rollout coincides nicely with WFH needs. 5G will require cell antennas every 100 to 200 meters, exposing many people to millimeter wave radiation. 5G also employs new technologies (e.g., active antennas capable of beam-forming; phased arrays; massive multiple inputs and outputs, known as massive MIMO) which pose unique challenges for measuring exposures.

    Great crowd control behavior modification tool as well.

    Paranoid, who wants to know?

    • GotCollateral says:

      And who is gonna pay for that 5G rollout? All the junk rated telecos like CTL, CCB, COMM, ZAYO, FTR, GTN, SATS, INTEL, SBGI, S, TMUS, TFX, VSAT, VOD, and ZIGGO with all the free flowing credit banks are just extending to them now and for perpetuity?

      Yeah, very believable… lol

    • Rand Passmore says:

      There are so many possible dangers and we need to keep our eyes wide open.

  5. Frankie USA says:

    Back in the late 1990s, the globalists and elites were trying to sell us on how wonderful it will be to transition over to a “service” based economy. How wonderful it will be to move all our supply chains to China. I wonder what do these same people have planned for us in the 2020s???

    • Rinaldo says:

      How about making plans for them??

      • Tom Pfotzer says:

        How about making plans for ourselves?

        What are we going to do when our job is no more, and it happens in the context of many others’ job-no-more?

        And those job losses will probably happen in the context of a drained commons: money is no longer valuable, national ability to (continue to) borrow decimated. How many $3T printings does it take to reduce the dollar’s value by 25%?

        What are we planning to do when those two fairly obvious trends converge?

        Today China announced it would reduce its Treasury holdings by at least 20%.

        This Corona thing could be viewed as a stress-test / dry-run for tools and thinking that may be sorely needed in just a few years’ time.

        • Paulo says:

          @ Tom P

          re: What are we going to do when our job is no more, and it happens in the context of many others’ job-no-more?

          Good point. This has happened to me two times in my work life and I just had to retrain and move on. The mistake I have seen others make is trying to hold on to what is slipping away.

          I used to ask my kids, “What will other people always need and be willing to pay for”. And, “think about that when you decide your career path.”

          Your comment included if others/most also lose their employment. Isn’t this the time to include limiting debt and living sensibly so there is a tomorrow during bleak times?

        • Tom Pfotzer says:

          Paulo:

          ” Isn’t this the time to include limiting debt and living sensibly so there is a tomorrow during bleak times?”

          Yes, indeed it is. I group debt mgmt / living sensibly under the general heading of “competence”:

          a. develop and maintain an accurate situational awareness. This is why WS readers are here, right?

          b. develop and execute viable plans that actually work in the world as it is, and as it’s becoming

          I eliminated debt several years ago, once I realized the adverse effect it had on well-being and fiscal discipline. I pPay for all inputs with cash.

          Most of my income is allocated to materials, technology development (household-based production for import substitution or export earnings), learning, and developing that elusive “accurate situational awareness”. Been doing this for decades.

          BTW, thanks Wolf! You and your commenters have been a great help to me on the situational awareness front.

        • Tom Pfotzer says:

          And thanks to you too, Nick. Wolf’s built a great team.

      • Frederick says:

        That sounds like a plan

    • Paulo says:

      Frankie,

      Add to that a tourist based economy. In many jurisdictions traditional industries were demonised and replaced with tourism. Now, whoops and oh oh.

    • wkevinw says:

      FrankieUSA- right. As early as ~1988 many businesses were starting to “globalize” in a new way. The USSR was starting to liberalize in the mid-80’s, which really got this started.

      It is still the case that some globalization is beneficial. Everybody wants access to markets.

      By 2000, I was getting suspicious, and by ~2005 I was very negative, and by 2010, I was anti-globalization (needs to be rolled back).

      I always argue by the extreme on this one. So is globalization/”free” trade good if we buy products made by slave labor? How about if the labor is paid $1 per year (no longer slaves, right!?). The globalists arguments have been shown to be crazy in an “unfair” market such as labor. There are other unfair international markets.

    • sierra7 says:

      Frankie:
      “I wonder what do these same people have planned for us in the 2020s???”
      That’s the problem…..depending or I should say, allowing “these same people” to decide what society needs/wants.
      Until the majority of the Americans finally realize that the US corporate power will not give up its power over our government’s legislators then we the people have to oppose them in any way shape of form.

      As far as “legally evading taxes” I know it is a routine play for those who really understand the tax laws.
      But, who pays for the infrastructure that sustains a suitable society?
      Normal, everyday grunts, that’s who.
      The rest skate.
      Let them. Their turn is coming too.

  6. MCH says:

    Bah….

    Eating out at restaurants is for the entitled, it’s another sign of privilege. The wage slaves at Starbucks and all of those eateries, whether national chains or mom and pop shops all need to be freed from their menial jobs.

    Those spaces that gets abandoned can be refurbished and revitalized as community meeting places, parks, and housing for the masses.

    The pandemic is a great change agent….

    • nick kelly says:

      You must be a Brit ( as am I) to be so into the ‘class struggle’

      Freed from their ‘menial jobs’ to do what?
      I’m not ‘entitled’, far from it, but as small treat I will have coffee out.
      And I don’t think of the generally pleasant staff as ‘menial’.

      I had a brief yack with one young gal at a Serious Coffee (smaller BC chain) and asked her how she was doing. “I’ve still got a job, but I don’t think my boss is doing so well”

      He had just bought the franchise when Covid hit.

      • MCH says:

        Nah, I’m just being sarcastic…

        And besides, I’m just paraphrasing some of the comments I’ve heard when crazy people are talking about privileges these days, and putting it into proper context.

        The problem with the freedom that I’ve described is that such freedom would basically lead to freedom from having a roof over your head. (AKA homeless). Freedom from having to suffer the outrages of waste functions of a human body. (AKA starving) Freedom from having to suffer the indignities of standing in line in the checkout aisle of your nearest supermarket. (AKA can’t afford groceries)

        Then we’ll get the inevitable demand for free money. That always works out well.

        If it’s anyone I feel sorry for, it’s those people who are running small businesses that are getting killed because of the rules around this pandemic. Rules designed to keep peoples “safe.”

      • Frederick says:

        That’s true When I lived in the Hamptons I was going to my local Starbucks every morning to socialize mainly and one of the baristas was a retired corporate attorney He didn’t need the wages obviously and just did it to keep busy He seemed to enjoy it

        • VintageVNvet says:

          Right on F,
          My last two jobs were exactly that, enjoyed the work, and enjoyed the folks I was working with.
          And older friend retired and was hanging around the house until one day the spouse said, “Honey, I married you for better and for worse, but not for lunch! Get out there and find something to do, and if you make a bit more money (that they didn’t need) so much the better.”
          So be prepared all you young folks getting ready to retire, and FIND SOMETHING (that you enjoy doing) TO DO!

    • TimTim says:

      Dark humour friend

  7. 2banana says:

    So…53% would rather go back to the office.

    And when they are allowed to do so, will folks at home suddenly find themselves on the peripheral of the power/decision nexus?

    It is all fun and games on the mandatory lockdowns when everyone is forced to participate.

    Business decisions, promotions and business relationships don’t really work that way.

    “with 47% wanting to do so “often” or even all the time.”

    • wkevinw says:

      As usual, this virtual working question is over stated.

      If you are in a business handling tangible products, you need to be at the workplace. This is a LOT of people.

      If you can work in a solitary environment- beware that you don’t get made into a gig worker/contractor. Solitary work is the sign of not having much need for diversity of knowledge (diversity of knowledge requirement is a sign of degree of difficulty). If you have an easy job (can do it all from home by yourself), be careful. (Zoom meetings are only fractionally effective compared to in person- sorry.)

      Good luck working from home a lot. It won’t be good for many people.

  8. Seanny says:

    When folks realize “working from home” means that, instead of spending 40+ hours each week in an office at work, they are now effectively at work 24/7/365, they may not think this is such a good idea. No more work-life balance, because there is no distinction between the workplace and your private life. Forget drinks with co-workers after a tough day. And, just wait until you see the surveillance tech that will be used to ensure we are doing our duty instead of napping on the couch. Bye bye privacy and freedom. I’d rather deal with the commute and keep the corporations out of my home, but COVID-19 means no one has a choice.

    • GotCollateral says:

      Lol ive been working from home for 5 years, and my dad has for nearly 30y… i can tell you that folks that have to submit to that garbage are those whose jobs are up next for the chopping block…

    • Just Some Random Guy says:

      Seanny,

      I’ve worked remotely most of my career. It’s all about being disciplined. That goes two ways. First is discipline that you don’t watch TV 1/2 the working day but do work you’re paid for. The other side is knowing when the work day ends and the home day begins. Don’t answer the phone or reply to emails past 5:00pm or 6:00pm or whatever you do at the office. And also a key is setting up a dedicated work area. Don’t make your couch your office. Don’t work while sitting in bed. Make a dedicated room that is your office and off limits to spouses or kids during business hours. When you are in that room you are at work, period.

      • YuShan says:

        I agree that’s the best way to do it, but for a couple that could mean you need two extra rooms.

      • VintageVNvet says:

        ”that’s right” jr,
        Did exactly that for many years as an independent contractor with clients all over USA… worked great, and, as you say, consider making clear to family that when working, one is not to be disturbed, especially when composing or on phone/conference calls, etc…
        Never took long to convince clients they were getting a better deal when I was working from home, no interruptions for social reasons from other staff, or even the client wanting social time.
        My only serious challenge came early on when a client wanted to infringe on my happy hours; after a while, again as you say, I just turned off the damn cell phone and was content,,, and would call them back either in my usual later work period or the next day.

      • Seanny says:

        Great advice, although you (and everyone else who replied to my comment) appear to miss my point entirely.

  9. Bob Hoye says:

    Thorough survey.
    TKS

  10. Richard Scholtz says:

    Working from an AirBNB in Mombasa – or Thailand – monthly rentals are 1/3 the price of US rentals – a good VPN with static IP in the USA and we are good. Coconut drinks on a tropical beach with a gorgeous babe (wife) in a 3rd world country making US Tech job wages… Life is Good ….God is great. I am blessed.

  11. Just Some Random Guy says:

    I’ve been saying this forever now, big cities are dead. If you own real estate in one, get selling ASAP.

    • Frederick says:

      How do you define “ big” cities? 20,10,5 million

      • Just Some Random Guy says:

        If it has a pro sports team in all 4 major sports. NY, LA, SF, Chicago, etc.

        • VintageVNvet says:

          OK, jr, that’s one way to define a megapolis,,, any city, or more appropriately municipal area, etc., with any commute more than 15-20 minutes is a big city,,, though some small town areas can coexist within it.
          In the ”metropolitan tpa bay area,;; trust me, it’s a totally big city when taken as a whole, even though there is no separate city here with all the sports, at least at this time.
          Sure now, it’s an opinion, eh
          BTW, please remind me of the name of the hockey team in SF.

        • Bill E Bob says:

          SF’s NHL team are the San Jose Sharks-who first played at the Cow Palace in SF.

  12. Sam says:

    Studies/survey’s reality of wfh not the panacea that’s being hyped on MSM.

    Not everyone function’s being a “house cat”. Ymmv.

  13. Shiloh1 says:

    Until there is a vaccine for lead projectiles downtown Chicago will be empty for at least a generation.

    • TimTim says:

      Shame. I enjoyed visiting Chicago in1996. Had a nice steak at a place I think was called ?Berghof’s.

  14. Engin-ear says:

    Less work at office,
    Less real estate value,
    Less taxes for State,
    Less balance sheet for banks,
    Less economic activity,
    Less money velocity,
    Less jobs.

    Repeat.

    • Tom Pfotzer says:

      More re-allocation of mis-spent capital toward things that generate wealth, like new materials, new industrial processes and technology, and better integration of humans with the natural world

      More time spent actually solving problems .vs. gripping a steering wheel

      Less time spent on office politics .vs. solving problems (creating value)

      Real Estate “value” is shifting from office to household. A good thing; most of us don’t own an office building, but many of us own a house.

      • Engin-ear says:

        While I don’t see the current situation as entirely dark, and there is always a hope and a need to try to do our best, I see no help behind the points you have listed.

        The mis-allocated capital will evaporate.

        Better integration of human with nature will pass by reducing our energy consumption, and probably the lifestyle.

        Abandoning the politics is the abandoning the peaceful negotiations. Before politics, the problems were solved by physical violence.

        And less office real estate could mean the shift of taxes to our households.

        • Tom Pfotzer says:

          Engin-ear:

          Great points. Feedback is:

          Mis-alloc capital will indeed mostly evaporate, so let’s not follow the bad with more bad. The target is moving (e.g. where the work happens) so let’s target new capital to where it’s needed (@ household). Less on roads / transport, and more on supporting the actual work.

          Early / big energy reductions come from 2 relatively easy targets: auto transport and home HVAC /building envelope. Both will happen if we continue to consolidate work @ 1 location (home) not 2 (home and office).

          Biggest human-natworld adaptation is at social-emotional level:

          a. what do I base my self-esteem upon? Consumption for social-standing signaling, or actual useful, adapted, long-term utility stuff?

          b. What’s enough? Does the natural world have value long-term? What are we willing to forgo now to have more (actual human viability) later?

          That’s why it’s so freakin’ hard. This hits us right where we’re weakest.

          I’m not advocating abandoning politics @ civic level. But office politics is mostly about bureaucrat-types scuffling over the poo-bah hat, and as many of us who’ve done the corporate thing know, that scuffling is rampant, dysfunctional, and after a few decades, pretty darn tedious.

          Yes, less office real estate does shift taxes to household. No question there. But we’re paying the taxes anyway; those taxes are just added into the price you pay at the pump/doctor’s office, etc.

        • Sgt Grumble says:

          In any event it’s a good stiff kick to the table.

  15. IanCad says:

    That the UK is governed by ostriches is made apparent by the insanity of HS2. Promoted on the premise that it would serve to ease the anticipated increase of those commuting from Birmingham to London this 120B boondoggle must be stopped.

    • YuShan says:

      Yes it’s really weird to spend 120B on something that is already obsolete before they have even started building it, while at the same time hundreds of billions need to be found somewhere to pay for the current crisis.

      But even before all this, it didn’t seem to be the best way to spend money for enabling the “Northern Powerhouse” and the environmental case is shaky at best.

  16. greg holmes says:

    I would think that green brigade will be all for this, think how much CO2 is being saved by not commuting.

    Brilliant for the planet.

    • Tom Pfotzer says:

      I’m green, and I’m all for it.

      I am also “all for” developing new industries and jobs and ideas and technology that will provide actual, viable alternatives to the “old ways”.

      My big problem with we “greens” – and so-called “progressives” in general is that we seem to be really good at complaining and objecting, and not so hot at developing viable alternatives to the behaviors that we object to.

      Of course, conservatives and all other strata of the political spectrum … don’t seem to be any better.

      If we could just direct all that emotional effort on developing, testing and rolling out alternatives, we could be having a lot more fun with all this change.

  17. PIETER says:

    Most of the over 50 crowd is having a hard time working from home in our corp. Can’t print from our laptops and all the peripherals are locked down. We have lots of older guys that printed every email. Every email and filed them in a file cabinet. They absolutely want to come back asap. Their wives now realize most of these guys working late was just hanging out at the office socializing (sports) or staying away from wives and kids to surf the web until well after 7:00 pm. It is insane to listen to them bitch and moan about not printing emails and wanting to be in an office/missing the commute/horrible cafe meals/disgusting corporate free coffee. Truly bizarre to hear it. Some people need that structure to actually do work I guess. Plus they have nothing to talk about now…. the bitching about your job doesn’t happen anymore unless you do it with your family pet.

    • Just Some Random Guy says:

      Ok I’ll bite. Why can’t they print emails at home?

      • PIETER says:

        The company only allows corp printers…. which are at the building which is closed to only the engineers. All staff outside of that will work from home until 2021 sometime.

    • X-Pat DE says:

      We had an “e-mail printer” in the department, from the old East Germany. Then, one day, the company “migrated” to OUTLOOK without migrating the old e-mails … guess who was laughing last!

    • VintageVNvet says:

      yeah P, you saying the tech was, like, ”so 20th century?”
      I have been printing in remote client office(s) across USA for at least 10 years that I can bring to mind, and as a ”pre boomer” could no way to considered any kind to tech wizard.

  18. Lisa_Hooker says:

    Working global projects, from Singapore to Bangalore to Prague to Berlin to NYC to San Francisco, online from home, destroys the concept of an 8 hour day. Thankfully nothing based in Hawaii.

  19. Sgt Grumble says:

    This is one of very few developments that could plausibly improve on Price’s Law which finds that half the actual production of any group is provided by the square root of the headcount.

  20. Whitey says:

    “People working from home now have a lot more time on their hands as well as more money in their pockets….”

    For now. The “man” will ratchet up the workload and cut the pay soon enough. Didn’t Facebook say that they are going to the WFH model and that pay will be cut for those working from lower cost of living locales?

  21. sierra7 says:

    Would be interesting to know what the percentage is of those jobs that can be “worked from home” and those that probably cannot.
    The plumber
    The carpenter (not cabinet maker; that’s a given)
    The electrician
    Most others in any kind of construction
    There has to be an enormous number not given to WFH.
    Also those that WFH need to be compensated for their contribution of property to the “company”.
    Organized labor for those who enjoy those amenities as office workers will have harder time staying “organized”.
    All this needs much more analysis.

  22. Julian says:

    “ 4. Many UK businesses embrace WFH. They stand to reap significant cost savings, particularly on office rents. They’re also fearful of being sued for damages if a worker does catch the virus on their premises.”

    Surely if you injure yourself at work, or catch the virus at work, the actual physical location of where you are working should be irrelevant.

    Your employer MUST still be liable. Did they do their diligence and ensure the place you are working (from home) is safe and secured, or not?

  23. Ian says:

    Obvious but interesting point about avoiding commuter hell. There will not be many people shedding tear for the rail companies. This is payback time and the result of poor historical decisions and management by the UK selling strategic assets. The transport network is to ensure the country functions and people and goods get to where they need to be. We were told the competition would be good for service and prices but in the end it just created regional monopolies. If you didnt like your provider it was tough t!tties unless you moved to another rip off area. Huge prices crap service, no sympathy. Rip off Britain at its best.

  24. Walter Ego says:

    This is 100% a by product of the health concerns from the virus and 100% temporary. As soon as the virus is gone or under control 80-90% of employees will be doing real work back at the office again. Sure, hours will be more flexible and WFH on certain days will be an option in many places but things will return to semi normal before long.

    Why?

    1. Human beings crave interaction and productivity has suffered in the WFH environment
    2. Human being crave variety
    3. People want to get away from their spouses and children during the day and few can afford a real separate home office setup
    4. Human beings want flirting with the opposite sex and the occasional office romance
    5. The office environment is a modern day jungle and needs to be face to face

    Yes, it will take a couple years or so and many real estate owners will suffer but the office is far from dead.

    • Wolf Richter says:

      Walter Ego,

      I’ve been working at home like a maniac since 2006, and I’m not missing the office at all, not one bit, zero, no part of it. My friends were never people I met at the office, and I never flirted with anyone at the office (terrible idea, anyway), and always hated office politics though I played them as well as anyone. So there you have it. Some people like going to the office, and others don’t. Not everyone feels like you.

      • Walter Ego says:

        Since 2006- you unknowingly made my point for me.

        There have always been odd balls like you and we you for it! However, the only reason why people WFH now is because of a deadly virus. When there’s no more deadly virus, things will go back to normal, mostly.

        But ya, the commuters will still hate it.

        • Wolf Richter says:

          Hahahaha, that’s one way of looking at it. But I was disputing your individual points and explained that not everyone is like you. I know tons of people who LOVE working at home — including those that just started to. I can tell that you hate it. I get that there are quite a few people who’d rather work at the office. But there are lots of people who’d rather not; a couple of times a month at the office or once a week or whatever is all they’ll need.

        • Walter Ego says:

          Wolf, I think you’re absolutely correct about that fact. A lot of people don’t want to work in an office. Also, a lot of people don’t want to work at all. A lot of people want free stuff from the govt as well!

          The debatable issues are:

          -what % of people want to WFH permanently?
          -how will this affect productivity?
          -how much vacancy will this create in the office market and the spillover effects into commercial real estate in general?

          It seems the media has decreed the death of the office without clear evidence.

    • PIETER says:

      sorry I totally disagree. I am hearing from many corporate executives that this is here to stay. Hearing maybe 25 % back in the office (Engineering/marketing). Entirely way better productivity numbers and they monitor everything through MyAnalytics (Microsoft product) and send us our monthly metrics. The utility savings is giant and the perks are all being shut off (in house coffee shop, cafe, gym, dry cleaning, day care). The weekly maintenance costs and cleaning. The budget for flowers was $78K a year – done for. The need for face to face is over – do everything through Microsoft Teams which is awesome. Virtual conferences each week work. Word is we are subleasing three of five floors come January. Look at REI…. they just finished a multi-million dollar complex and it is all up for sale. Work from home is being fully embraced.

  25. Cashboy says:

    A lot of employees will lose out in the long term with this desire to work from home.
    1) Employers will find a lot of people dispensable; i.e. they were not actually achieving much when in the office anyway.
    2) Employers will reduce employee’s wages by say £8,000 gross per anum on the basis that someone commuting to London spends £5,000 buying a season ticket informing the employee that they are still better off by three hours a day without the one and a half hour commute to London each way.
    3) Employers will realise that if this employee is capable of working from home, then the company might be able to replace this employee with someone in India or the Philippines at 20% of the cost.

  26. Work From Office says:

    This from the guy who brought you streaming video and probably benefited from the Lockdown more than anyone.

    WSJ: It’s been anticipated that many companies will shift to a work-from-home approach for many employees even after the Covid-19 crisis. What do you think?

    Mr. Hastings: If I had to guess, the five-day workweek will become four days in the office while one day is virtual from home. I’d bet that’s where a lot of companies end up.

    WSJ: Do you have a date in mind for when your workforce returns to the office?

    Mr. Hastings: Twelve hours after a vaccine is approved.

    WSJ: I like that.

    Mr. Hastings: It’s probably six months after a vaccine. Once we can get a majority of people vaccinated, then it’s probably back in the office.

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