Average weekly - 43%
Peak Day - Wednesday 54%
Slow Day - Friday 29%
The return to the office momentum slowed during the March break but recovered afterward.
CEOs are reporting that remote work is particularly harmful for youth career pathing largely because senior experienced employees are staying home at an alarming rate reducing opportunities for in-person mentoring and collaboration. Research conducted by SRRA in London and New York indicates that remote work is at similar rates in the heart of both cities and is having the same impact on productivity and training development. Corporate leadership in those cities is requiring a return to the office for as much as 90% of pre-COVID levels.
The attached links to articles underscore the issues facing employers whose employees avoid the office. As one senior executive put it, ‘it’s hard to separate and focus on work while the distractions of home life constantly break concentration throughout the day’. As another executive pointed out, ‘the commute provides the opportunity for quiet time to prepare for work on the way in and refocus on home and other activities on the way home, this is being ignored in the discussion on remote work.’
The next Index is scheduled for week of April 10th. 2023.
Your SRRA team
Links to Articles of Interest
RBC Hardens the Line on Returning to the Office – Productivity At Risk, Says CEO
In a blunt email to employees, RBC says, “Without frequent in-person engagement the bank’s long-term competitiveness is at risk.” Rather than say how many days in the office are required, RBC flips the script, suggesting that after May 1, employees “will be able to work from home one or two days a week, depending on the requirements of their teams.” The memo goes on to say, “When our teams come together on-site more frequently, we are solving complex problems faster, learning and growing more effectively, and ultimately building deeper connections with one another.” Although other banks continue to hedge on the issue, CEO Dave Mackay recently told analysts that he believes “most CEOs would tell you that there is a productivity loss.” In the clearest terms yet, the memo discusses the challenge of achieving a balance between carrot and stick but the bank’s leadership has clearly reached the limit of the slack it is prepared to allow. “We want to continue to encourage …healthy and positive face-to-face moments while ensuring a level of flexibility that we know is important. For this reason, we are shifting toward a more consistent approach to in-person routines that will double down on our culture and lay the foundation to protect our competitive edge in the years ahead.”
https://www.theglobeandmail.com/business/article-rbc-employees-hybrid-office-work/
Toronto Lags Behind the U.S., and the U.S. Lags Behind the Rest of the World When It Comes Returning to the Office: What Gives?
As frequently reported in this space, Toronto is well behind the average occupancy achieved in major U.S. cities – currently at 43%, while U.S. is closer to 50%. According to the Wall Street Journal, a new report by JLL (Jones Lang Lasalle) estimates that ‘’Office attendance has returned to 70% to 90% in Europe and the Middle East, and around 80% to 110% in some Asian cities, meaning some workers are spending more time in the office now than pre-COVID. Global cities like Tokyo, Seoul, Singapore, Paris and Stockholm “reached at least 75% office occupancy throughout 2021 and 2022.” according to JLL. One of the issues is the length of commute, historically longer in places like New York and Chicago. Other factors such as a tight labour market could be influencing these results, the report concludes. Reluctance to force workers back could be a ‘Canadian thing.’
https://www.cnbc.com/2023/03/02/why-us-return-to-office-plans-are-lagging-behind-global-cities.html
Commuting Provides a Useful Break Between Home and Work, Study Finds
Commutes are a source of "liminal space"—a time free of both home and work roles that provides an opportunity to recover from work and mentally switch gears to home. This according to a study published in Organizational Psychology Review reporting on interviews with U.S. office workers. While obviously not applicable across the board, suggestions that time spent commuting can actually be beneficial would appear to foster the view that remote working can blur the edges between personal time and the level of application required to be effective at work.
https://phys.org/news/2023-03-psychological-benefits-commuting-remote-doesnt.html
Relief From Buzzwords to Describe the Current Work Environment Won’t Be Available Any Time Soon
The latest offensive buzzword to go the rounds is ‘quiet hiring,’ an acknowledgment that the best candidates for a position can often be found internally. Which begs the question: if your face isn’t familiar to those making the decisions does this reduce your chances of being hired (or promoted)?
Rare Example of Positive Impacts From COVID
A U.S. organization that tracks workplace environments (‘Best Place for Working Parents’) reports that on-site daycares increased in number during the pandemic. One-third of the women and one-fifth of the men who left the workforce during the pandemic cited a lack of childcare or its expense, according to a 2022 McKinsey & Co. survey. “It’s one of our top attraction and retention tools,” Marriott International Vice President of Benefits Judy Fennimore told the WSJ.
Toronto Gains Two New We-Work Venues
Banking on the continued popularity of hybrid work, We-Work is opening new locations in Toronto’s Financial District, including occupancy of an entire ‘historic’ 10-storey building on Bay Street and brand-new space in Scotia Plaza. The theme is consistent with the company’s belief in Toronto as one of North America’s strongest office markets. “It will provide turnkey, enterprise-grade spaces that meet this local demand for flexibility,” the company says.
https://www.cnbc.com/amp/2023/03/16/ceo-bosses-who-force-rto-have-control-issues.html
Lower Manhattan Dust Up Over Proposed Office Conversion
The irony. A prominent residential developer is suing new owners and former landlord over a proposal to convert a ‘first class’ office building (known as the New York Technology Center)
to condos. Citing a clause in their lease that explicitly prohibits residential uses, the company states in its lawsuit that it “never imagined, and would never have countenanced, moving into a residential apartment building for the conduct of its business.” The suit also refers to the planned removal of asbestos as a health hazard – surely an issue that would apply to many buildings constructed more than 50 years ago.
https://therealdeal.com/new-york/2023/03/20/office-tenant-sues-to-stop-55-broad-resi-conversion/
A Majority of Employers Interviewed by the Urban Land Institute Are Playing a Waiting Game to Decide on the Future of their Office Holdings
Ongoing confusion of how best to address hybrid work schedules, ‘activity-based workspace’ and other issues in the face of economic uncertainty is causing employers to put plans to adjust their office footprints on hold according to a new ULI/Instant Group survey of U.S. employers. Only 14% of those consulted are satisfied they are on the right track for the future. Perhaps more significant is a finding that “less than 2% of asset owners feel they have the required capex to respond to occupier and ESG legislation-related requirements.”
“The Occupancy Index is supported by the City of Toronto, Financial District BIA, Bloor-Yorkville BIA, The Waterfront BIA, Downtown Yonge BIA, St Lawrence Market BIA and Toronto Entertainment District BIA. It is a measure of the percentage of office employees returning to the office compared to the number of employees who would normally have come to their offices pre-COVID. For a detailed description of the calculation please contact Iain Dobson at [email protected],”