I have posted this on Reddit (askeconomics) a while back but got no good replies. Copying it here because I don’t want to send traffic to Reddit.
What do you think?
I see a big push to take employees back to the office. I personally don’t mind either working remote or in the office, but I think big companies tend to think rationally in terms of cost/benefit and I haven’t seen a convincing explanation yet of why they are so keen to have everyone back.
If remote work was just as productive as in-person, a remote-only company could use it to be more efficient than their work-in-office competitors, so I assume there’s no conclusive evidence that this is the case. But I haven’t seen conclusive evidence of the contrary either, and I think employers would have good reason to trumpet any findings at least internally to their employees (“we’ve seen KPI so-and-so drop with everyone working from home” or “project X was severely delayed by lack of in-person coordination” wouldn’t make everyone happy to return in presence, but at least it would make a good argument for a manager to explain to their team)
Instead, all I keep hearing is inspirational wish-wash like “we value the power of working together”. Which is fine, but why are we valuing it more than the cost of office space?
On the side of employees, I often see arguments like “these companies made a big investment in offices and now they don’t want to look stupid by leaving them empty”. But all these large companies have spent billions to acquire smaller companies/products and dropped them without a second thought. I can’t believe the same companies would now be so sentimentally attached to office buildings if it made any economic sense to close them.
They’re wasting money on big buildings and rent.
Also, they want control of your activity while your on the clock. It bothers them if you’re more productive, get the same amount of work done but can relax more at home. Which is the way it should be. If I can do the same work in 4 hours than I can in 8, I should get paid the same, and be able to relax, instead of being made to stay at work for 8hrs and be given even more things to do to just stay busy.
I am surprised they don’t just cut costs by not having a physical location then? Or is this just while waiting out lease agreements.
Some smaller companies are doing this. It makes them more agile financially and actually helps their growth to not have a building to pay for. I don’t understand the larger companies.
They spent millions building a facility or are locked into 5/10 year leases. I’ve also heard it’s because cities are dying, no one in offices to eat ‘down the street’ at the food shops, people don’t stop at the bar on the way home, no impulse shopping trip because you’re already out.
My company just moved their office space into a smaller section of the parent company’s building, which funnily enough is nicer than where we were beforehand. Going in every few months makes the trip into London feel like a nice trip instead of a commute.
Plenty are, it’s just that the largest companies built those places, they cannot trivially liquidate them. Plus they usually own the whole land, so cutting part of it away is not easy.
They still should. For many jobs office work is a completely unnecessary waste of:
- Productivity (via constant distractions)
- Time (commuting)
- Money (via the building maintenance costs)
- Space (the actual building)
- Resources (heating and shit)
But managers are loathe to ever admit any failings, our market culture frowns upon this. Hence admitting that your building is no longer needed is not a thing any manager to wants to bring up in a meeting to their bosses, so back to the office it is. :<
it’s just that the largest companies built those places
And that’s the biggest one imho: They were able to leverage their huge size to save money long term by building and owning.
Now that the status quo has changed, they want to change it back so that their advantage is still in effect.
Another reason you’ve not yet been given is that some of these companies have decades long contracts for renting. The government should intervene and cancel the contracts and pay for them to be converted to flats tbqh. Someone will say “But that will cost more than building a new one![citation needed]” but knocking down half the office buildings at once will probably give everyone in the cities supercancer*[citation needed]*
I’m extremely pro-WFH for professions that can. I’ve been doing it for 10 years and it has only gotten better since others started to experience it and have empathy for what it means to be a remote worker. Just getting that out of the way before chatting more about hidden difficulties of converting buildings to residential use…
I can’t speak for European office buildings (your use of “flats” has me assuming you’re on the other side of the pond from me), but a large number of US buildings would either have to be 100% gutted back to the main supporting beams OR pulled down and rebuilt. Issue here is a combo of proper placement of utility lines (mostly plumbing) within the building and the added weight residential use brings rather than business use.
Large office leases here have a lot of control over how their floors are laid out, but floor planning normally takes electrical runs into consideration and will leave spaces like kitchens and bathrooms unmoved. Executive offices and other private interior spaces can be created/adjusted by making interior walls and tying into electrical connections already in a floor or drop ceiling.
Plumbing is a whole other monster and takes a lot more work. Not an insurmountable consideration, just harder.
The weight of residential living is one I hadn’t considered until someone pointed it out to me. In addition to all the additional plumbing needed (whose pipes add tonnage by the time you’ve converted a building), you also have to consider water within those pipes, and if a lot of people run their kid’s evening bath around 7 PM, that’s even more tonnage, normally all in a similar vertical line because of repeated floor plans. A lot of corporate buildings here, esp older ones, just weren’t engineered for that and a lot would need significant remediation to support it.
I have way less to say about the super cancers… We did use a LOT of asbestos as we built up urban areas, though.
I’ve never understood the empty buildings argument. Wouldn’t the company be “wasting” just as much money if the building was empty or full? Might even cost more to have it occupied since then you need hvac.
Not just rent, they own those big buildings. They’re assets, and what happens when everyone realizes they don’t need those buildings at the same time? Corporate real estate crashes and those assets are worthless. Nobody wants a huge asset dropping off their balance sheet because they let their employees wfh before they could offload their offices.
The shitty middle management who think like your second point are convenient, but I don’t think they’re the ones making the decision to call employees back in a lot of cases.
