Return to office push is 'totally dead,' experts say, as WFH persists
Remote work is here to stay, employers are discovering
Nearly four years into the coronavirus pandemic, the society-wide return of white-collar employees to their pre-pandemic offices that some have eagerly awaited and others have long dreaded remains largely unrealized.
Restaurants and stadiums are packed, and students are back in school, but corporate executives and even some government leaders are finding it difficult to lure workers back to the office.
After office occupancy approached 50% nationwide earlier this year, return-to-office (RTO) rates in many major cities remain stagnant. “The data all shows the RTO push is over,” remote work expert Nicholas Bloom of Stanford University told Yahoo News in an email. “Totally dead.”
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Coming back but only partly
Executives who that believe in-person interaction fosters collaboration tried to bring workers back into the office in 2021 and 2022, only to be undone by the Delta and Omicron variants of the coronavirus. Big-city mayors also clamored for office workers, whose spending they said once sustained downtowns that had been emptied. President Biden even mentioned returning to the office in 2022’s State of the Union address.
Those calls only grew louder in 2023. “I completely understand why someone doesn't want to commute an hour and a half every day, totally got it. Doesn't mean they have to have a job here either,” JPMorgan chief executive Jamie Dimon told the Economist in mid-July.
The tide was turning — or so it seemed. "Fall 2023 is shaping up as remote work’s biggest test yet," Fortune noted, pointing out that some a million office employees faced strict back-to-the office mandates in September.
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Work-from-home 'going to stick around'
While some office workers have returned, any hopes for a return to 2019-style work habits, when remote work was rare, have been dashed.
New York Mayor Eric Adams was a major RTO booster when he first took office, deriding remote workers as pajama-clad loafers. But for all his boosterism, return to office rates actually fell at the start of 2023 to 61%, after rising to a high of 65% in 2022, according to Axios.
“I have no reason to think it's suddenly going to shoot up,” one of the mayor’s top aides told Yahoo News. In June 2022, Adams ordered all white-collar civil servants back to the office full-time. But this year, as the city struggled to retain or attract employees, he agreed to allow two days per week work-from-home, or WFH, for members of the city’s largest municipal union. “Some version of this is going to stick around,” the aide acknowledged.
In August, a survey by workplace platform Envoy of more than 1,000 executives and managers who have returned to the office found 80% regret their initial RTO orders, saying they would have liked to have more accurate data before crafting their policies.
“Many companies are realizing they could have been a lot more measured in their approach, rather than making big, bold, very controversial decisions based on executives’ opinions rather than employee data,” Larry Gadea, Envoy’s CEO and founder, told CNBC.
Bloom and others say the future is hybrid, with employees back in the office two or three days a week, with Mondays and Fridays as the likeliest WFH days. A recent report by consulting company McKinsey found that, on average, employees were going to the office 3.5 days a week
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The role of government
The federal government is the largest employer in the nation, with thousands of employees in major cities like New York and Los Angeles — and more than 300,000 in Washington, D.C., alone. Elected leaders there have been pleading with the Biden administration to end its lenient work-from-home policies; others have argued that once the federal government makes RTO mandatory, some holdouts in private industry could potentially follow.
Last summer, White House chief of staff Jeff Zients told agency heads across the federal government that they needed to “aggressively execute” an RTO plan after the long Labor Day weekend.
A senior official with the federal Office of Management and Budget, which oversees the federal government’s 2.2 million employees, told Yahoo News that RTO “has been a major priority.” He said that every agency is working on a return-to-office plan, with some further ahead than others, though he declined to give specifics.
“We are midstream in implementation right now,” the OMB official said, emphasizing that the ultimate goal is an enforceable hybrid policy. “We've learned a lot about how to operate effectively and provide flexibility to folks. But there's certain things that you just can't capture without adequate, meaningful, intentional in-person time.”
The official said that OMB had been tracking usage of Washington’s subway and commuter rail usage, and that a 40% increase between October 2022 and October 2023 was an especially hopeful sign that the Biden administration’s RTO push is working.
What’s next
Millions of square feet in office towers will sit empty for the foreseeable future, as the effects of remote work fall hardest on the downtowns of midsize, economically precarious Rust Belt cities. “There’s winners and losers,” Bloom of Stanford told Yahoo News. “That’s the nature of progress.”
Some office buildings may be converted to residential units in cities like New York and Boston where affordable housing has become extremely difficult to find. But the aide to Mayor Adams noted zoning laws and design changes make those conversions often challenging, if not impossible. “Those are really hard projects,” he said.
Still, Bloom said that while things are bleak in many a U.S. downtown, worries about a broader urban decline are being overstated. “Look, New York’s going to thrive,” he said. “As are all major American cities.”
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This article was updated to more accurately describe Envoy's report on return-to-office policies.
