Future of Work: Flexibility is Key
When it comes to the post-pandemic world of work, If there is one thing that has become evident as we re-build and move forward, it is that flexibility is paramount for businesses to succeed. This means flexibility for a company’s operations and flexibility for employee’s schedules. While COVID-19 has brought upon permanent changes in nearly all industries, the corporate real estate (CRE) world has arguably been altered as much, or more so, than any other sector. For many white collar professions that make up the majority of corporate real estate tenants, the days of exclusively in-person work for five days per week are over. Therefore, companies are reassessing their physical footprint to maximize efficiency and financial assets. This is why flexibility is key for commercial real estate, where companies are cognizant of ways to reduce costs, determine their path towards a new normal, and prepare for variables such as supply chain challenges, a recession and labor shortages.
In the News
The notion of flexibility in the workplace is certainly not a new concept, but considering the pandemic forced employees across various industries to work remotely for over a year – and in some cases two years – the world of work cannot return to the way it was before March 2020. In fact, research has shown that employees now expect flexibility in the workplace.
In fact, United States Secretary of Labor Martin J. Walsh just opened up on the subject of flexibility in the workplace in a recent interview with Politico.
Walsh told the publication that flexibility is key. Saying, “I think it’s a change of mindset.”
Walsh went on to say, “I can’t sit here and tell you where we should be six months from now, because I don’t think any of us really know… We are living in these times that we have an opportunity to do a reset for the American workforce, and the world workforce.”
While it remains unclear exactly what the future holds for the workforce, if COVID-19 taught us anything it is that being prepared and having a plan to adjust quickly to unknown variables can make all the difference between success and failure for a business.
With that in mind, it is a good time to take a look at where the numbers stand now in terms of remote work. A Washington Post article written by staff writer Andrew Van Dam entitled, “The remote work revolution is already reshaping America,” provides perspective and insight into national data and trends.
Van Dam writes, “Around a third of work was done remotely in the United States in 2021 and 2022, according to economists José María Barrero (Autonomous Technological Institute of Mexico), Nicholas Bloom (Stanford University) and Steven Davis (University of Chicago).”
Van Dam’s article continues with the following finding, “A new poll shared with The Post by Gallup found 29 percent of remote-capable workers working from home full time in June — down from 39 percent in February — while the share working hybrid schedules rose a comparable amount.”
With a clear movement towards agility in the workplace, it’s no secret that many companies able to transition to a hybrid modality have either done so already or are planning or considering.
A recently published CNBC article, entitled, “Inflation and hybrid work ‘skyrocketed’ demand for flexible workspace, WeWork says,” touches on the subject of a transition to hybrid work. The piece, written by CNBC Make It reporter Goh Chiew Tong, begins by saying, “Global inflationary pressures are pushing companies to be “more nimble” with their corporate real estate portfolios, according to WeWork.”
As part of her article, Tong quotes Samit Chopra, WeWork’s international president and COO as saying, “That … has put the need for companies to look at flexibility in managing and thinking about their workspace…”
If implemented correctly, hybrid strategies can include many benefits for employees and the organization as a whole, such as increased productivity, higher employee satisfaction and reduced costs.
The transition to hybrid also means a shift in what is required in the office for employees. One of the more dramatic changes when moving from primarily in-person work to a hybrid modality is that individually assigned desks may no longer be necessary, which could mean you no longer need the same space you once occupied. For some companies this could result in reimagining your existing space to better meet your needs, while for other companies it could entail leasing space or moving altogether.
Space Reduction or Reorganization
With a change in the way work is done, taking inventory of your company’s space becomes critical. Depending on the findings of space use, patterns and trends, you can then make the most informed decisions between reducing your real estate portfolio or re-designing current work spaces.
If you are wondering how seismic the shift is when it comes to corporate real estate, according to the findings from a Fortune article written in June,2021, by Lance Lambert, 74% of Fortune 500 CEOs expected to reduce office space.
However, an Insider article published in February,2022 and written by reporters Alcynna Lloyd and Madison Hoff found that the number of U.S. businesses that have cut space since the start of the pandemic isn’t as high as you may think.
Lloyd and Hoff highlighted the following three conclusions in their article:
- Only 5.5% of businesses cut office space during the pandemic, despite more people working from home.
- And only 4% of private-sector businesses said they expect to decrease size in the next 12 months.
- Regardless of square footage, companies are still thinking about changing up their offices.