It may be time for San Francisco companies to call the employee bluff – TechCrunch
Spend any time in New York and you will feel it. Manhattan and Brooklyn are bustling with activity. It’s electrifying to be here after years of being relatively locked up.
The question, and the one posed this week by the San Francisco Chronicle, is why San Francisco isn’t bouncing back the same way.
As journalist Roland Li writes: “There has always been a disparity – New York has 10 times the population of San Francisco – but coastal tourism and economic centers have diverged starkly as they recover from the pandemic.”
Consider, Li writes, that while construction of major commercial real estate projects in Manhattan has been completed during the pandemic — and while much of that new office space is almost fully leased — in San Francisco, the projects are on point. dead and existing buildings are struggling to find tenants due to work-from-home policies.
One possible way to fill these buildings is to convert them into housing. Wall Street, Li observes, has been doing just that for decades. But while in New York there’s a clear demand for housing, with rents hitting record highs even now, in San Francisco it’s not as clear that enough people would – right now – rent office space. converted even if they were made available.
Indeed, the new work-from-home policies are clearly having a major impact on where people live, and many Bay Area employees who might flee the region’s high prices have done so. (California — led by San Francisco, and followed by Los Angeles — lost more than 352,000 people between April 2020 and January 2022, according to statistics from the California Department of Finance.)
Perhaps it’s time to ask whether these fully distributed plans still make sense. In his article, Li partly draws a line between the “discordant crowds” on the streets of New York City until April last year, when then-Mayor Bill de Blasio announced that city employees would soon return to the office, a decision soon followed by private companies.
Called back by employers, New Yorkers who left during the pandemic suddenly found themselves looking for accommodation, if only to spend just two or three days in the office.
The gambit continues to work, apparently. The Partnership for New York City, which says it surveyed more than 160 employers over a two-week period in late April and early May, found that 38% of their Manhattan employees are now back in the office on the average weekday, while that 28% are entirely distant. Meanwhile, average attendance is expected to reach 49% next month.
This does not mean that the employees are back full time. They may never be, given that even the most vocal critics of remote work have been forced to soften their stance, including JPMorgan Chase CEO Jamie Dimon. As Bloomberg reported in May, Dimon told shareholders in an April letter that working from home will “become more permanent in corporate America” and estimated that about 40% of its 270,000 employees would work under a hybrid model. Shortly after, a senior technology executive at the bank told some teams they could spend two days instead of three days in the office if they wanted, based on internal feedback.
Those two to three days a week could save New York, and maybe it’s time more San Francisco employers who have shied away from demanding their own employees consider doing the same.
Small businesses in San Francisco are increasingly desperate for the economic activity that office workers would bring back; while civic duty isn’t a priority for local tech companies, there’s still a strong case that hybrid environments allow employees to enjoy better work-life balance, more camaraderie with co-workers, and also to advance in their career.
Many blame San Francisco’s inability to rebound on its lack of affordable housing, and there’s no doubt the city is self-sabotaging itself on this front. In San Francisco, “instead of clear rules, where a developer knows ‘I’m allowed to build here,’ everything is a negotiation and each project happens on an ad hoc basis,” Jenny Schuetz, housing economist at the Brookings Institution, told The Atlantic in May.
But abandoning return-to-work plans forever won’t solve the problem. Meanwhile, two and a half years after the pandemic sent everyone home, and amid a slowing U.S. economy that makes it harder to change jobs (and the CDC’s newly relaxed COVID ), it might be time for more gear to have employees come into the office two to three times a week and see what happens from there.
It is not the employers’ responsibility to “fix” San Francisco. At the same time, there may not be much left to come back if they wait too long.