The work from home trend has become a part of the furniture for so many employees, that it might take a recession to change the attitude of workers who now have the upper hand with their employers. This post-pandemic social revolution will have enormous impacts on company productivity, profits and share prices of many companies.
The AFR tells us that the ANZ CEO, Shayne Elliott, can only get 20% of his 28,000 workers back in the office and the Property Council of Australia says the workers showing up to Melbourne offices have stalled at 36% on average. But Wednesday is the best day for going to the workplace with attendance numbers at 42%.
And what days are the worst for office blocks? Yep, Mondays and Fridays, when only 19% of workers can make it to the office!
Interestingly, academics have calculated the travel time cost savings for workers and it comes in at $5.6 billion. However, these savings for the household budgets fail to look at the gains from less childcare outlays, smaller lunch costs and other savings that come from working from home.
For example, home-based workers could have lower outlays on more expensive clothing, which could be considerable for someone in the office five days a week.
The AFR says the London firm, Stephenson Harwood actually imposed a 20% pay cut on their employees who wanted to work from home. In August last year, Google rolled out a calculator to explain potential pay cuts to employees who choose to work remotely, and then Reuters reported that employees, who previously commuted an hour to Google’s Manhattan offices from nearby Stamford, Connecticut, would see their salaries slashed by 15% if they choose to continue working from home.
By March this year, “Google told its workers in its San Francisco Bay area offices that they’d be expected to come back into the office on April 4 but they’d given ground opting for a hybrid work model, with three days in the office.” (Washingtonpost)
This contrasts with other tech companies such as Twitter and Slack, which have said they will allow remote work indefinitely! Locally, Mike Cannon-Brookes’ Atlassian has a similar policy of letting workers decide on where and when they work.
And the competition for high-flying workers is such, in tight job markets that Goldman Sachs has offered their executives, wait for it, unlimited leave! How does that work?
Work from home is now tagged as WFH and so many employees love it so much that it's called a “social revolution” by academics, that was created by the pandemic lockdowns. But only 4 in 10 workers can revolt against their bosses and it’s a white-collar thing with 60% of employees simply unable to do their job at home.
Tradies, retailer workers, nurses and others like them have to show up to work to do their jobs, while in contrast, many office workers can do their tasks from home.
But the big question has to be what happens to the productivity and profits of the businesses caught out by this social revolution? Over the next year or so we will learn what the consequences are for the companies. And if the results are a worry, we could see bosses playing hardball with their employees or else they will look overseas to see if cheaper workers can replace the local WFH employees.
And failing that, there might be the recession that bosses have to have to get back in charge, but that’s not anything any of us should wish for.
The business model has changed forever and the hybrid employment setup will become a feature of the workplace of the future but employees have to be flexible and considerate of the negative effects on their employers’ businesses or else they could find themselves at home without a job.
That said, a big four bank executive in charge of small business customers says there has been an escalation of new start-up businesses following the lockdowns of 2020 and 2021.
The appeal of working from home might create some Atlassians of the future!
From an equities point of view, companies like Lend Lease and REITs in the office space are set to be in trouble as their tenants ask for lower rents and smaller spaces thanks to this WFH trend.
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