Return To The Office? CEOs Learn To Love Remote Workers, For Now

 Speaking at a recent conference, Starbucks (SBUX) Chief Executive Howard Schultz showed frustration at the number of workers opting to work from home instead of returning to the coffee giant's corporate offices in the wake of Covid-19.

Now for investors awareness of these Trends is not only important
0 seconds of 16 minutes, 42 secondsVolume 0Instead of a "Great Return," many workers are opting for a "Great Resignation" if they must return to the office and not work from home or switch to a hybrid work schedule. And in a plentiful job market, many CEOs are finding the experience humbling as they give in to worker demands.

"I have been unsuccessful, despite everything I've tried to do, to get our people back to work," Schultz said. "I've pleaded with them. I said I'll get on my knees. I'll do pushups. Whatever you want. Come back."

The challenge is just one of many for Corporate America in a decade chock-full of adversity thus far. Two years ago companies struggled to adjust to a world full of reluctant shut-ins due to Covid. Now many firms are finding their employees would rather stay sequestered, having warmed up to the benefits of working remotely.

Schultz is not the only corporate chieftain bending over backward for employees. Many are giving in, at least for now, and wondering if a recession will tip the balance back their way. Some CEOs think the battle between remote work and a full return to office life is already over.

"The debate's over — hybrid won," Logitech (LOGI) CEO Bracken Darrell told Investor's Business Daily, referring to mixed office-home work schedules.

Benefits Of Working From Home

The number of fully remote work opportunities available is skyrocketing, according to professional job search firm Ladders. Some 24% of all professional jobs posted in the first quarter were available as fully remote. That's up from 10% in the first quarter last year and 3% in the first quarter of 2020.

Bracken P. Darrell work from home views
Logitech CEO Bracken Darrell says companies will have to allow workers to have a hybrid schedule between the office and their homes. (dpa/picture-alliance/Newscom)

The benefits of remote work include the elimination of time-wasting commutes and a better work-life balance for parents. Roughly 40% to 50% of the U.S. workforce can do their jobs remotely, says Alexandra Samuel, an expert on remote work and the digital workplace.

"The pandemic was a real gamechanger for a lot of people," Samuel told IBD.

Employers are feeling a seismic shift as well. Amid historically low unemployment, the balance of power has shifted to employees from employers, says Samuel. People have more opportunities to change jobs now.

Kate Lister, president of remote work analytics firm Global Workplace Analytics, says companies could lose valuable knowledge workers if they adopt rigid return-to-office plans.

Bosses need to learn to manage by results, not "butts in seats," to avoid a landslide of office resignations, she told IBD.

Return To Office: Many Likely To Quit Their Jobs

Employers have reason to fear the Great Resignation. An IBD/TIPP poll in June found that 38% of employees are "very likely" or "somewhat likely" to quit their job if required to return to the office full-time. Other polls are finding similar results, leaving countless companies with tons of unused space on their hands.

Work from home productivity chartOwl Labs sampled people who worked from home during the pandemic. It found that 32% of respondents would quit their jobs if they could no longer work remotely. An additional 18% were undecided on whether they'd stay in a job if the option for remote work were taken away.

The shift has pluses for makers of PCs and peripherals. Companies and employees need equipment for both corporate and home offices.

PC and printer maker HP (HPQ) says its pending $3.3 billion acquisition of enterprise headset maker Poly (POLY) is a play on the growth of hybrid work solutions.

But Lister says the power balance between employees and employers could shift back the companies' way if a recession strikes.

"A lot is going to depend on the economy and whether we go into a recession," she said. "The reason that employers are willing to adopt remote and hybrid workplace programs is because of talent shortages."

Companies could use return-to-office mandates for stealth layoffs, she says. Those who don't comply with returning to corporate offices could be let go.

Apple Employees Protest Return To Office

Until then, however, the ball is in the workers' court. In late May, consumer electronics giant Apple (AAPL) delayed a plan to require workers to come back to the office three days a week.

Apple blamed a resurgence in Covid cases, but the decision also followed an employee protest. In April, about 200 Apple workers wrote an open letter to management, complaining about the tech giant's return-to-office plans. They said the shift would be hard on those with children and people with long commutes.

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Apple employees are complaining about the company's plans for returning to the office. (Apple)

"Office-bound work is a technology from the last century, from the era before ubiquitous video-call-capable internet and everyone being on the same internal chat application," the group's letter said. They believe the company is on a path to returning to the corporate offices full-time.

Alphabet (GOOGL) unit Google has decided on a hybrid work model with three days in the office and two days remote.

Financial services giant JPMorgan (JPM) asked hybrid employees to come into the office at least three days a week, and has been tracking attendance with employee ID swipes. The policy has created an atmosphere of mistrust and panic at JPMorgan, Insider reported.

Logitech, a maker of PC peripherals, has adopted a hybrid work model, CEO Darrell says. It includes in-office days as well as remote workdays.

Otherwise, he said, "The Great Return (to offices) could be followed by the even greater resignation."

Young Leaders Won't Demand Return To Office

Other companies have embraced fully remote work for those who prefer it. They include Airbnb (ABNB), Twitter (TWTR), and Facebook parent Meta Platforms (META).

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Videoconference apps such as Zoom are playing a critical role in reformulating office plans. (Zoom)

On June 23, Yelp (YELP) CEO Jeremy Stoppelman announced that his company is fully adopting remote work. He said the company plans to close "consistently underutilized offices" in Chicago, New York, and Washington, D.C. The company also intends to reduce its office space in Phoenix.

"Over time we came to realize that the future of work at Yelp is remote," he said in a blog post. "It's best for our employees, and for our business."

Airbnb CEO Brian Chesky said working at the office is a relic of the past. He believes hybrid work will become the norm with greater flexibility than some big companies are advocating.

"The office as we know it is over," Chesky recently told Time magazine. "It's kind of like an anachronistic form. It's from a pre-digital age."

"You go to those big skyscrapers, and all those CEOs telling you that they have to come back to the office," 40-year-old Chesky said. "Most CEOs are from a different generation. Young leaders are going to think quite differently."

A Hard Line From Tesla

Others, however, are taking a harder line against telecommuting, despite the risk of a Great Resignation.

Tesla (TSLA) CEO Elon Musk has demanded that white-collar staffers return to work at the corporate offices.

Elon Musk
Tesla Chief Executive Elon Musk has taken a hard line on office staff working from home. (Kathy Hutchins/Shutterstock)

"Remote work is no longer acceptable," Musk said in a company email. He said employees who don't like the return-to-the-office policy can "pretend to work somewhere else."

Meanwhile, Microsoft (MSFT) CEO Satya Nadella said the software giant is seeing record engagement on its LinkedIn job search and networking platform for professionals. He called the increase in knowledge workers changing jobs "the Great Reshuffle," on an April 26 conference call with analysts.

Still, the shift to remote and hybrid work could reshape the commercial real estate market if companies reduce their office footprints, Lister says. Metropolitan areas like Chicago, Los Angeles, and San Francisco already are seeing large and growing surpluses of unused office space.

Companies likely will redesign their offices with state-of-the-art videoconferencing rooms to accommodate hybrid teams, Lister says. They'll also probably add more small collaborative areas and activity-based workspaces for in-person workers.

Logitech's Darrell says his company likely will re-evaluate how much office space it needs over the next three years.

Is A Return To Office Necessary?

Companies say they want employees in their offices for in-person collaboration and community building. But with digital technologies like videoconferencing, a lot of that interaction can be done from work-from-home locations, Samuel says.

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Large surpluses of unused workspace are showing up in various metro areas as employees opt to stay home. (Sergey Nivens -

"A lot of organizations have a notion, often very fuzzy, of culture that is based on face-to-face contact," she said. That contact still has value, but it doesn't need to be five days a week in a corporate building, she says.

The best approach for corporations is hybrid work built around teams using a coordinated schedule, Samuel says. Team-based scheduling ensures that the people who should meet in person are in the corporate office at the same time. Companies offering hybrid work shouldn't let employees choose which days to work at home or remotely, Samuel says.

Meanwhile, recent studies suggest that working from home makes people happier, healthier, and even more productive. Not to mention it staves off a Great Resignation.

The migration back to offices picked up steam this spring as the omicron wave of Covid subsided. Workers today are working from home by choice rather than necessity because of the pandemic.

"Many people experienced remote work for the first time," Samuel said. "It also provided a perspective shift on life after being at home and spending more time with family. Values changed and people's attitudes toward work changed as a result."

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