The COVID-19 pandemic has ravaged every corner of society. When the stay-at-home orders began to be issued, many workers were required to work from home. During this time, business owners and managers continued to assure employees that this move was temporary, and moving back to the office was inevitable. However, as the pandemic continues to drag on, businesses find they may not need to go back to the office after all. Dozens of large companies like Spotify, Amazon, and Twitter have made the permanent switch to working from home. This article will show you why businesses are moving away from offices and what this move means for commercial real estate.
Why Businesses are Leaving the Office
The biggest reason businesses are deciding to continue remote work over going back to the office is the employees’ health and safety. Employers now realize that COVID-19 is not going away anytime soon. Having employees work from home prevents the virus from spreading across the office, causing a mass infection that could damage the office’s overall productivity. Also, many employees request the ability to work from home, so there is less risk of spreading the virus to family members.
Protecting employees from COVID-19 is not the only reason businesses are continuing to operate from home. Commercial real estate, especially in major cities, is costly. For smaller companies, paying rent on an office can take up a significant portion of the budget. We are now seeing more and more business give up their leases on office space in favor of work from home. According to Global Workplace Analytics, 6 out of 10 employers found they are saving more money when they moved to full-time work from home. These businesses use this money to dole out raises or hire new employees to help with the workflow.
When the pandemic first started, many business owners worried that productivity would take a massive hit once they moved to work from home. However, thanks to the growing influence of technology, employees maintained the same productivity level working from home. According to Airtasker, employees that work from home produce more work than their office counterparts. This increase in productivity is due to no commute times and the availability of helpful technology. However, the same study claims 29% of employees that work from the home struggle with balancing their work and home life.
What the Future Holds for American Work Life
One thing to take away from the COVID-19 pandemic is the American work-life is changed forever. In major cities like Los Angeles, New York City, and San Francisco, office buildings remain empty as business owners continue to adjust to the new normal. Commercial real estate insiders now believe that the work from home momentum will not stop even after COVID-19 subsides in the US. According to Bruce Barren, a market analyst, commercial real estate has a long road to pre-COVID-19 numbers. Barren states, “The commercial real estate market is focusing more on the work-at-home style than being located at the commercial property itself. Further, most industry specialists do not expect this trend to reverse itself until the COVID-19 pandemic reverses itself, and even then, the stay-at-home work, pajamas, and internet ordering economy has and is continuing to gain significant momentum.”
Bibliography
Caramela, Sammi. “Remote Workers Are More Productive.” Business News Daily, 31 Mar. 2020, www.businessnewsdaily.com/15259-working-from-home-more-productive.html.
Casado, Lara. “17 Major Companies That Have Announced Employees Can Work Remotely Long Term.” Entrepreneur, 17 Aug. 2020, www.entrepreneur.com/article/354872.
Ebeling, Paul. “Commercial Real Estate Will Be in Trouble Long After COVID-19 Has Faded.” Live Trading News, 18 Oct. 2020, www.livetradingnews.com/commercial-real-estate-will-be-in-trouble-long-after-covid-19-has-faded-198472.html.
Silvermann, Baruch. “How Working From Home Can Save Companies Money.” Business.com, 16 June 2020, www.business.com/articles/working-from-home-save-money/.
