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  • This is how corporate America feels about remote work in 2023.

  • The laptop classes

  • living in la la land, it's messed up to assume that this

  • they have to go to work. But you don't. It's not just a

  • productivity thing. I think it's morally wrong. Listen,

  • it doesn't work for young kids. It doesn't work for spontaneity,

  • it doesn't really work for management.

  • And this is how the corporate world felt about remote work in

  • 2020, during the height of COVID-19.

  • The biggest advantages I think, are access to large pools of

  • talent, who don't live around the big cities and aren't

  • willing to move there. Since

  • we've all been forced into being remote now for nine months, I

  • think we've realized that if you have somebody in a particular

  • location who's willing to work the hours to be able to

  • collaborate, you can do it very effectively. So it's changed

  • that we thought about hiring. Let's

  • pause here, notice something in fewer than three years,

  • corporate leaders have reversed their approach to remote work.

  • And it seems like this tactic has been working, the latest

  • data from the Census Bureau found that fewer than 26% of US

  • households still have someone working from home. That's down

  • from 37% in early 2021. So

  • the reason we're having this entire conversation about remote

  • work dying is first of all, because we kept thinking that

  • we're going to bounce back to quote unquote, normal when the

  • pandemic started, and we had people working from home. The

  • idea was, this is very temporary, and we were all going

  • to come back. So

  • really what's changed the discussion about remote work is

  • the slowdown in the labor market. There are a lot of

  • employers out there who had suspicions about remote work

  • from the start. And you can see that kind of by the timing of

  • when people actually went to being remote during the start of

  • the pandemic. So the concerns that employers had about remote

  • work were present all during the Great reshuffle. But they didn't

  • really have much of a choice. But with the emergency orders

  • expiring for the pandemic this year. Now, they can actually

  • start to bring people back and address some of those concerns

  • that they might have about productivity.

  • remote work was brought upon us basically by the pandemic,

  • before the pandemic remote work was pretty rare. So about 5% of

  • days, were forced to work from home, you know, all managers and

  • professionals were basically fully remote from March of 2020.

  • And then it turns out, it's worked really well,

  • such as no commute work in in your sweatpants doing your

  • laundry between zoom calls, but also just the savings in terms

  • of time in terms of money in terms of your commute in terms

  • of being able to spend more time with your children or pick them

  • up from school, people quickly

  • found ways to be productive, to continue communications together

  • and to keep collaborating together. And whatever tools

  • they could invest in to support that work and that teamwork.

  • As the world slowly started to open up, corporate America began

  • to change its tune on remote work, so much so that some firms

  • now even threatened to fire their employees, if they don't

  • show up at work,

  • zoom the company this is now throwing in the towel on fully

  • remote work,

  • even zoom, the video conferencing company that helps

  • make the remote work boom happened in the first place, is

  • also taking a hard line on return to office. It's an

  • abrupt shift from last year, when I suggested a majority of

  • its employees would work a hybrid schedule of just 2%

  • working in person full time.

  • So some of the pushback remote work is driven by concerns about

  • productivity. There have been some experimental studies that

  • show that there's some productivity impact potentially

  • from remote work. But those studies are also experiments,

  • right? It's unclear how they applied to the broader labor

  • force,

  • the United States does have a productivity problem. Before the

  • second quarter of this year, the country had experienced five

  • consecutive quarters of year over year declines in worker

  • productivity. In fact, a major study that Professor Nicholas

  • Bloom co authored found that fully remote work led to

  • productivity declines of about 10 to 20%, when compared to

  • fully in person work. Now, the

  • other important thing in this study is we pointed out, look

  • what firms care about, ultimately, is profitability.

  • And it turns out that if you have an employee that's remote,

  • you also save a lot of costs. So you're saving about 10% less

  • overhead because you don't have an office and then you could

  • have these folks, maybe nationally or internationally

  • and maybe save another 20 30 40% remote workers they may be 5

  • 10% less productive, but they are so much cheaper that is

  • profitable for firms to have many teams many employees remote

  • if you're coming with the stat to protect yourself to put the

  • positive narrative for people to return to work. I like to think

  • what were the productivity like when people were all working

  • from home what you're not allowed to have any face to face

  • worker at all right? So now you're spinning it in your

  • favor. So I'd like to challenge that

  • if the employee can perform their their duties and handle

  • their responsibilities. They should be encouraged to work

  • from wherever makes them feel as excited about life as possible.

  • I camped in Key West for three weeks. I was in North Dakota in

  • February, I've been up and down the coast of California and I've

  • been to our national parks. For me. That's where I feel best

  • working. And that's where I've gotten my best work done. I

  • believe we can work from anywhere.

  • My name is Sujan Parajuli, I used to work for JPMorgan and

  • Chase it was all remote. But once they changed their policy to

  • come to office that was in Plano, Texas, but I live in

  • California. So I decided not to move out there because of my

  • kids. So I have two school going kids. I have to manage work life

  • balance as well. That was the reason why I quit my job. JP

  • Morgan had given me 45 days of timeframe to find another job.

  • And I applied for some other companies and found remote

  • job with Leidos, so I have been working remotely with Leidos

  • as a senior system analyst.

  • Parajuli is not alone in his choice to quit rather than

  • return to an office setting. Finding a fully remote job,

  • though, is getting more challenging. New research from

  • indeed found that job postings are declining faster in

  • metropolitan areas where many jobs can be done remotely. A

  • similar trend is playing out on LinkedIn as

  • well. So on LinkedIn last year, we saw that about one in seven

  • jobs were remote. And now that's down to about one in 11. But

  • over this time, we've also seen an inversion. Now we see about

  • one in seven jobs being hybrid coming up from one and 11 last

  • year. So we're seeing more folks coming back into the office, but

  • they are not coming back into the office five days a week,

  • many employers are strong arming their team members, and that

  • they would love remote work to die faster. As a result, I do

  • see that remote work is quote unquote, slowly dying and

  • becoming more competitive to get.

  • The pandemic induced shift to remote work has raised concerns

  • about the future of commercial real estate, especially office

  • spaces. The latest report from McKinsey Global Institute

  • suggests that remote work threatens to erase $800 billion

  • from the value of Office real estate in nine major cities

  • around the world. Other experts say the empty offices created by

  • remote work in various cities are also leading to what's been

  • called the, quote, urban doom loop.

  • The problem does start with the Office demand right then we've

  • seen with the advent of remote work and hybrid work and

  • dramatic reduction in office demand over these past two

  • years, that has led to right to rising vacancy rates and in

  • fact, all time high vacancy rates in the office market right

  • now. And that does put pressure downward pressure on the

  • valuations of these offices, you mentioned that they're down, you

  • know, probably 20 or 30%. Already, they're likely to fall

  • by more. And that causes downward pressure on property

  • tax revenues, because for a lot of cities, office tax revenues

  • is a big chunk of their tax revenues, often as much as 50%.

  • Some of that is is coming from office, maybe 20%. So maybe 10%

  • of overall tax revenues for cities comes from office, if

  • those offices lose about half of their value, tax revenues fall

  • and that creates a huge hole in the budget.

  • So like everything, there are going to be winners and losers

  • as we transition to a world where we have remote work as a

  • permanent feature. One of the potential losers is commercial

  • real estate, in part because offices aren't needed as much or

  • they're not needed at all. So commercial real estate may be a

  • loser for remote work. We may also be concerned about

  • businesses that support workers who come to the office. So think

  • about your food trucks, your laundry services, all of these

  • businesses that are centered around folks coming into the

  • office five days a week, they may face difficulties, when

  • that's not happening as much

  • commercial real estate is problematic in a number of big

  • cities. But there are a lot of people now who are saying that

  • we need to bring people back to the office because our

  • commercial buildings are empty, which is a little bit like

  • saying, we need to have people use the horse and buggy because

  • cars are going to wipe out that industry, we have to understand

  • that the world has changed. Our ways of working have changed and

  • we can't go back to an old outdated way simply because we

  • are being motivated by commercial real estate,

  • commercial real estate needs to rethink we've already seen in

  • some cities, that it's being converted, it's being used for

  • other purposes, some of it's being converted into residential

  • housing, and we're going to have to get much more creative about

  • what to do with those empty buildings.

  • If you're pushing your employees to come back to the office, you

  • got to make sure that they're coming back to the office for

  • something other than me. I

  • don't think we ever will bounce back to those pre pandemic days.

  • What I do think we will see and we are already seeing is that

  • there is a benefit to also being in person and that's why we're

  • seeing companies first saying come back one day a week

  • two days a week, three days a week, maybe four days a week

  • even. But I do think that the old school five days a week, 40

  • hours on the premises, I do think that's dead. I don't think

  • it's coming back.

  • I'm a family person. And most importantly, I can save like,

  • multiple hours by working from home by saving commute hours, and

  • which I can give to my family. I can give those hours for myself,

  • which has been benefiting a lot and I always prefer to do

  • work remotely.

  • Work From Home is here to stay. You know, if you're concerned

  • about it, the best thing to do is figure out how to make it

  • work because it's definitely not going away.

This is how corporate America feels about remote work in 2023.

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