While some major companies, including Boeing and UPS, continue to demand that their employees return to the office five days a week, for a growing number of today’s organizations, that policy is shaping up to be the exception rather than the rule.
More businesses across the U.S. are instead coming to embrace a more flexible, hybrid work policy after pushback from employees who prefer to work remotely at least part of the time. As companies develop these policies, they’ve had to navigate the delicate balance between employee satisfaction, worker productivity, and the potential financial impact of partially empty office space.
But as economics professor at Stanford University and work-from-home expert Nick Bloom has said, it does appear the “return to office died in ’23.” A four-day work week, thought to be the cure for stemming resignations two years after the pandemic, is also slipping away for some companies. Instead, Bloom’s projection that workers would come into the office about three days a week is becoming the norm.
“People are open to returning, but going to either extreme is a mistake for employers,” says Jamie Thomas, vice president of Human Resources at the Arlington, Va.-based Consumer Technology Association (CTA), a trade association representing the $398 billion U.S. consumer technology industry. CTA puts on the world’s largest trade show.
Expectations were still somewhat lofty for return to office as recently as late last year. An August 2023 report from Resume Builder showed that a hefty 90 percent of companies surveyed planned to implement return-to-office policies by the end of 2024.
But at the time, just 36 percent said employees were required to come in five days a week. And that’s a number that could continue to dwindle as workers who are unwilling to return full-time to an in-office desk look elsewhere for work.
Before CTA kicked off its own return to office program in September 2021 — a little more than a year after the pandemic began — the company brought its 150 full-time workers into the decision-making process by sending out an employee survey. Responses helped to inform a new company culture document and return-to-work policy, said Thomas.
Initially, staff were asked to work in-office one day a week, with a second day optional. Since then, CTA has shifted to a two-day in-office hybrid approach. Now, Tuesday is a core day when all employees are in-office, with meetings in-person.
“People don’t want to come into the office and sit on Zoom – they could do that at home,” Thomas says. For the second in-person day, 75 percent of CTA’s staff chose Wednesdays and 25 percent Thursdays. Few workers wanted to be in-office on Mondays and Fridays.
Part of CTA’s approach has been to make in-office time especially meaningful and distinct from remote-work days. For example, the company has added lunch and learn sessions and events like a catered barbecue lunch for National Barbecue Day.
Additional perks include Toastmasters sessions at the office to help staff with public speaking. And there’s a generous public transportation stipend, too, which better covers costs now that in-office days are limited, while employee garage parking is now free.
But while CTA is focusing on bringing people into the office, other companies are eschewing a return-to-office policy altogether.
When Gina Foringer, president and owner of Environmental Research Group, acquired a company that added several dozen new employees who were working in-person in offices outside of Austin, Texas and in Oklahoma to her remote staff of 100, she didn’t want to set a return-to-office mandate. Instead, Foringer has let employees decide.
“Most people do want to come into the office,” she says, “but not every day.” Still, around ten to fifteen employees in Texas and Oklahoma do now work in person Monday through Friday, while others have chosen to come in just two to three days a week.
“I’ve always believed, work where you do your best work,” Foringer says. “When you force someone to do something, they don’t feel grateful, and gratitude is one of our core values.”
At the same time, Foringer has been careful to manage costs to make a hybrid schedule possible. For example, employees not in-office full time work on a laptop and use a docking station in-office rather than having a dedicated space and desktop computer. Staff who are in-person at least four days a week get their own desk space.
Paying for an emptier space can be a hard pill to swallow, she says, but employees are happy to stretch out. One worker brings in a bed for his dog that he fits by his desk. “It’s money I’m paying anyway,” Foringer says.
If more people opted to work remotely or were in the office less, Foringer might consider buying a new space instead of paying rent, she adds.
Meanwhile, as hybrid setups take hold, the commercial real estate market is in the midst of an upheaval. When Josh Levering, senior vice president, managing director at commercial real estate firm NAI James E. Hanson, showed a Manhattan client spaces a few weeks ago in New Jersey, most buildings were empty on a Friday.
“That almost seems to be the norm now,” Hanson says.
While so-called “trophy buildings” -those with amenities and new technology close to public transportation – still seem to be filling up, other properties sit empty. New Jersey is currently tracking an 18.1 percent office vacancy rate, according to CommercialEdge data.
Property owners are responding by converting office spaces into residential properties – though not all of these spaces are easily convertible – as well as into medical buildings and even public parks.
“This wave of replacement is currently very aggressively happening,” says Hanson.
Companies that lease their own office space are increasingly looking to sublease to other tenants to offset expenses, he says. Still, “subleasing is not for the weak of heart,” says Hanson. Contracts can be restrictive, while many spaces don’t lend themselves to sharing with another company.
With that, some businesses that lease their office space are simply waiting for their contract to end so they can make a switch to a smaller space. It’s a trend that may continue as more businesses settle into a hybrid approach.
“People just aren’t returning in droves back to the office,” says Thomas.
