Why Work at Home Is Not Likely to Thrive After the Covid Era

Many white collar workers seem to be enthusiastic about the work from home trend, now freed of time-eating commutes, office politics, and hovering bosses. It’s hardly a secret that Covid-induced fear of commuter trains, busses and elevators has led CEOs to revamp operations and allow employees who can to work remotely. It has already radically reshaped the residential real estate market, with professionals who have extra cash hoovering up houses in exurbs or other states with lower costs of living but reasonable amenities.

But is this shift a lasting development? Remote work is hardly a new concept, as outsourcing and offshoring of lots of tasks, such as coding, call centers, and legal research attests. Despite the press and broker enthusiasm for this shift, it’s likely to wind up being rolled back significantly post-Covid. Some of the reasons why:

CEOs overwhelmingly dislike work from home. A Wall Street Journal survey late last year found that by more than a 2:1 margin, CEOs thought the costs and risks of working from home outweighed the benefit. And the minority camp consisted of CEOs who said they’d made it work, or were willing to have work at home continue post-Covid on a limited basis.

Illustrative quotes:

“There’s sort of an emerging sense behind the scenes of executives saying, ‘This is not going to be sustainable.’” —Laszlo Bock, chief executive of human-resources startup Humu and former HR chief at Google

“I don’t see any positives. Not being able to get together in person, particularly internationally, is a pure negative.” —Reed Hastings, co-chief executive of Netflix Inc., on working from home

“We tried it…It’s just not the same. You just cannot get the same quality of work.” –Rajat Bhageria, CEO of robotics startup Chef Robotics, on what the company learned in attempting to work remotely

The overwhelming majority of academic studies on work from home have found those employees are less productive. The only exception was one in the US from the employees themselves, who have incentives to score themselves well if they enjoy their new freedom.1 But their perception isn’t the one that counts. It’s that of the higher ups.

“Productive” isn’t just the worker’s perception that he is executing his tasks more efficiently at home; his bosses and co-workers may incur frictions in defining his tasks, coordinating them, and reviewing his output that can considerably or more than offset any perceived increase of his efficiency in isolation. A survey of small and medium-sized US firms found that working from home reduced productivity by 20% on average; a Japanese study found a decline of 30% to 40%. Some of the reasons why:

The problems with remote work will become more pronounced over time. Those of you old enough to remember the dot-com era may recall predictions that traditional companies would become largely passe because the Internet make it possible for free-lancers to team up and collaborate and outmaneuver the dinosaurs. That didn’t happen, even at the margins. The reason was obvious to me at the time: the considerable cost of negotiating and contracting.

At a decently-managed company, the whole is greater than the sum of the parts. People learn from each other, not just in the formal sense, but also how to get along with and get the best out of their peers and bosses.

That all comes under stress save for roles where the employee regularly works autonomously on well-defined tasks. Zoom meetings are a poor substitute for the much freer give-and-take you have in live sessions (and mind you, I hate meetings). You don’t have good approximations of the informal corridor or lunch line or bathroom chat where you exchange some information that might be consequential. And it’s very difficult to train and acculturate new employees remotely.

A colleague argued that a big reason that work at home was viable was that organizations were essentially frozen during Covid. Workers wouldn’t be changing jobs due most employers having to get their footing in the new normal and not being in expansion mode, plus the difficulty of getting in-person interviews. The reduction in turnover means that established relationships continue even though the teams and managers have to work out new routines.

The longer this continues, the more the interpersonal networks start to fray. Some will retire and need to be replaced or have their duties redistributed. So managers in companies where a fair amount of the tasks require collaboration or close oversight are likely to find work at home performing less well the longer it goes on.

Hybrid working is hard to implement. Some CEOs have found that the distribution of tasks in their operation has enabled them to operate efficiently in a work at home framework. Others, either due to wanting to appear worker-friendly or finding some roles can be performed well at a remove, have said they expect to implement a hybrid approach going forward, with some employees working at home and others back at the office full time, and some working part time at home.

This is super messy from a managerial standpoint. Even though work at home is popular with employees, except these flexible approaches to be cut way back. As Forbes explains:

There are real risks inherent with the leading return-to-work hybrid system. Companies will have to ensure that their employees don’t take advantage of the system by collectively deciding to work remotely on Mondays and Fridays, to the disadvantage of other co-workers. It can become a logistical nightmare for managers to have impromptu meetings, as everyone is operating on a different schedule and in varied time zones. A supervisor needs to keep in mind who is working where and when they are available.

Wired confirmed this impediment in Remote Work Has Its Perks, Until You Want a Promotion:

But adopting remote work has costs less easily tracked on a spreadsheet. One of the biggest is coordinating and managing workers spread across locations and time zones, and able to meet only virtually…

Darren Murph, head of remote at GitLab, a software startup with more than 1,200 workers in more than 65 countries but not a single office, agrees. He likens combining traditional offices with a large remote workforce to mixing oil and water. “You’re going to have to work really hard to make sure remote workers don’t feel like a second class,” he says.

The employee arms race means many will find quickly that working at home comes at a career cost. Even with the societal need for as many employees as possible to stay away from the office, both some Silicon Valley employers and Deutsche Bank proposed paying remote workers less. Tech firms argued that employees should not be able to Californicate their pay to a lower-cost area like Oregon or Utah; Deutsche proposed cutting work at home pay by 5% and giving it to those who had to keep coming in.

But there’s a big reason why employees themselves may start retreating from work at home: unless all of their competitors are spending as much time away from the office as they are, they are likely to be disadvantaged in pay and promotions. They ones who turn up more often will benefit from more opportunistic interactions, better company intel, and more face time with managers and executives.

From The People Space in 2021:

In 2020 US payment processor Stripe offered a one-time payment of $20,000 to employees who opted to move out of San Francisco, New York or Seattle. The rub? It came with a salary cut of up to 10%.

Stripe is not the only one. California-based VMware has also introduced a similar policy for employees who move to less-expensive cities while other tech giants Facebook, Twitter and ServiceNow have all considered such measures.

Now new research from executive research firm Leathwaite finds 45% of HR leaders believe that, if employees who work remotely are based in locations with a lower cost of living and without a commute, it should impact their fixed salary and bonus potential. Meanwhile nearly four in 10 expect the promotion prospects of employees who opt to work remotely on a permanent basis to be impacted.

And that’s before you get to the fact that pre-Covid, employees who worked remotely some or all of the time were generally at a disadvantage in terms of advancement. For instance, from BBC in 2017:

But the problems with working from home begin right from the start. That’s because we think everybody can do all aspects of their job away from the office.

That’s what Esther Canonico found in a recently published study of 514 workers. Canonico, a fellow with the London School of Economics Department of Management, says the at-home workers in her study didn’t receive any training or guidance in how to pull off the transition. It added up since nearly half of the 514 people she studied either worked from home full-time or had some flexibility in their schedules.

If you’ve done it yourself, you know that working from home is not as simple as opening your laptop and getting down to business. Training—something some of us loathe and others of us can’t get enough of—can make the difference between failure and success away from the office…

Then there are the everyday pitfalls that can lead to serious career damage or stagnation, Canonico said. For instance, if you aren’t in the office and your presence isn’t felt, you’re likely to miss out on new projects and opportunites as they’re doled out to someone the boss sees every day.

In fact, new research from the University of Arizona shows 40% of employees who were working from home feel disconnected from the company’s strategic direction and one-third feel like they don’t get support from bosses, according to Joe Carella, assistant dean of executive education at University of Arizona’s Eller College of Management.

“People working from home become professionally and personally isolated,” Canonico says. “They say ‘out of sight, out of mind’.”

And CNBC in 2019:

But according to bestselling management author and CNBC contributor Suzy Welch, working from the comfort of your home or coffee shop can easily become “a career killer.”…

“Here’s the truth,” says Welch. “The best work in an organization, the important work, it never gets done on the phone, or over email or on Slack.”

Instead, she says, “it is almost always facilitated by relationships and understandings that only happen when people are together physically.” Great teams are built on “the banter, the lunches, the late nights, the jokes, the asides, the shared ah-has!”

That type of bonding, she says, “builds layers of trust, and trust is a career’s rocket fuel. You can fly without it, but you can’t soar.”

And Wired during the pandemic:

That will be challenging if Facebook and other remote-curious tech companies keep most managers and top executives onsite amid the conference rooms, snack stations, and foosball tables. Choudhury says a hybrid of remote and office work is hard to pull off without disadvantaging people offsite who receive less attention from leadership, while onsite workers can more easily cater to executives and win promotions. “That’s a recipe for disaster,” he says. “To do it well you have to have all or the majority remote, and you have to have managers who are remote.”

In other words, to the extent that particular companies preserve significant work at home populations, it will because they’ve figured out how to use it to lower costs. That means not just office space but over time paying employees in lower cost locations less. Big companies know just as well as Rahm Emanuel never to let a crisis go to waste.


1 A widely-reported US survey found that men working at home scored themselves as more productive and women less. While it’s not hard to see that women with kids would get stuck with minding them while also trying do to their day jobs, as we indicated earlier, the men’s self-rating does not factor in the overall organizational perspective. And on top of that, the survey didn’t indicate how they found their respondents. If this was entirely or significantly a Web survey, it’s a garbage-in, garbage out exercise.

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  1. BrianM

    As someone who has worked from home for a long time, I find articles like this a little frustrating in that it tries to convey a single viewpoint. The problem with those efficiency averages is that I think they hide a wide variation. There are clearly people for who working at home is a nightmare for all the reasons above. There are some for which it is a dream and they are way more effective. I know myself, on the occasions I was in the office I found all these people distracting!

    There is a comment that managing flexible working is hard – I think there are aspects of remote working generally that are hard. Saying that, some companies have got it right and it really works for them. Others (I’d guess more hierarchical) really struggle with it.

    Informally, a client surveyed their workforce and they got a roughly even split: one third wanted to work only from home, one third office only and one third mixed. I wonder if that’s a common mix?

    1. Yves Smith Post author

      Honestly, did you read past all the caveats about the nature of the work and .the organizations? Or that this post is about companies that implemented work at home due to Covid? People who were under remote work regimes before are in a different category. If all of your peers are under a similar arrangement, you won’t be disadvantaged by working at home, as I stressed. The career risk comes when some people are in the office and others not much/at all.

      This was hardly one size fits all. I am saying that workers who love working from home are choosing to ignore lots of messaging from CEOs that they don’t, and many people will be caught out by formal or competitive pressure to spend more time in the office post Covid.

      I see a remarkable amount of shooting the messenger from readers who like working form home. Don’t say you weren’t warned.

      I think you are missing a significant point of the article. Your perception of your personal efficiency is not what matters. You are part of a bigger machine. Perhaps you really do have discrete enough tasks that management does not have to invest a lot of extra energy to devise procedures and coordination/supervisory routines for them to make sure your work is completed up to their standards, on a timely basis, and that you keep others up the chain and laterally informed.

      In other words, you act as if optimizing at your level is what matters, not optimizing across the entire process/project in which you are involved. If management thinks the entire process is less efficient by virtue of coordinating/supervising remote workers, even if that is not accurate or you are so productive as to be an exception, their perception is what governs, not yours.

      1. cocomaan

        If management thinks the entire process is less efficient by virtue of coordinating/supervising remote workers, even if that is not accurate or you are so productive as to be an exception, their perception is what governs, not yours.

        This is definitely true, but I wonder to what extent the management class of today will be eclipsed in a few years by people who lived under the WFH regime and remembered it fondly.

        What I mean is, the people who are against WFH and don’t seem to be able to grasp how to manage their employees generally suck at technology and have a mental block to using email or zoom or other tools (if only in my experience). I have seen management in some places still confused on how to use zoom controls like sharing screens, now a year on.

        You’re absolutely right that CEO and HR perspectives matter here, but I also think that the people in those positions aren’t as comfortable with technology as they make themselves out to be. Management from afar takes some skill with tech and that’s in shorter supply than I thought.

      2. BrianM

        I’m probably more guilty of not reading your framing and my first line was more harsh than it should have been.
        Maybe my sample of senior contacts is far from representative (mostly small organisations in knowledge industries), but I’m hearing there will be more working from home afterwards than there was before. So I’ll stand by my comments on the stats – I note the variations in the study by sector run from 20% down (Information & Communications) to 37% (retail). What I’m not clear on is what the distribution around those averages are – I’d guess there’s long tails, hence my comment. But maybe I’m wrong – all IMHO.

  2. vlade

    Looking at the list, it’s not very convincing IMO.

    For me, they fall under a few cateogories:
    Transient problems
    – telecom problems. Duh. Sure, if someone has no inet connection, or 1mb one, it’s not going to work. But in lots of the places connections are now specced to be able to deal with muliple-netflix-streaming people, which is more than enough to deal with it.
    – family memebers, private room. Of course, if the whole family WFH + kids (who are really the major distraction) are on distance learning, it is a problem. But at least kids at home is not the expectation going forward

    Wrong type of work
    – regs limitations and task limitations. Sure, no-one’s going to take home a CNC machine to manufacture parts, or run a trading desk that has regulatory requirements like control and recording. But it’s not meant to even now.
    – direct customer interation. Again. Work that’s primarly F2F can’t be done remotely, and no-one argues with that.

    Generational reasons:
    – loss of quick F2F comms. That’s, in my observation, really a generational thing. For teens/20s something, mobile phone comms (or Slack/Discord etc.) work just as well as F2F. I’m not saying it’s good, but it’s definitely there.

    IMO, WFH will increase. But it will not be across-the-board. It will be in jobs/places where it makes sense, and won’ t be five-out-of-five. But I see two to three out of five as common for many white-collar job *). Which will still have a massive impact on city centres etc.

    *) not everyone, not immediately when you start a new job. I spent last 8 years WFH at least part of it, across a number of different clients. Only at one client I do WFH from the start, normaly I’d say that spending at least the first month full on-site (including beer after work etc.) and a couple of other partials, is a crucial part of getting to know the environs.

    1. Yves Smith Post author

      That survey was from Japan, and I’ve very surprised that broadband isn’t up to snuff everywhere. Here in the US it’s a big issue, so I would not dismiss it so easily. Even if you have a fiber connection, the servers go down or are scheduled for maintenance (never announced but weekend early AM times point to that) way too often.

      You need to read the CEO comments. If a substantial majority thinks the costs are too high (and remember they have the pricey office offset), I’d not be so quick to dismiss their view.

      1. vlade

        I’ve seen the CEO comments.

        But TBH, most of the CEO’s that commented on it negatively are US CEOs. I can see it in London, where the US banks are pushing for their employees to get to offices much faster than the European ones (with the exception of Barclays, who’s an American banker ex JPM).

        Say this says that more than half of London businesses expect to do more WFH, same here for FTSE100 The FTSE 100 includes companies like BP, LSE, Lloyds, Unilever etc. (comments from those companies in the linked article).

        1. Yves Smith Post author

          Probably not as many people in London decamping to the boonies, unlike the US, so asking people to come into the office once every couple of weeks or a month for a meeting is feasible.

          1. vlade

            There are no boonies in the UK :) (at least not where you’d get any sort of decent inet connection).

            And while some tried to decamp outside of the UK, that was met with no understanding by their employers (tax, regulatory etc. reasons).

            But my large client in London had even before last year a policy of 20% WFH for many employees (as in not “you can WFH”, it was more of “you will WFH one day a week”).

            1. Redlife2017

              This is very true. I know a very senior manager at CHUBB and pre-pandemic the firm had redesigned the work environment for more hot-desking and probably about 20% work from home. Those people HAD to work from home because they got rid of about 20% of the desks.

              So, I think some of these CEOs are using a strawman – everyone wants to only work at home – in order to not have to deal with the fact that people want BOTH work from home and work from the office. I mean I don’t know anybody who thinks that we should only be sitting at home and not having meetings, coffees, etc. in the office. But it doesn’t have to be five days a week either.

              There are, by the way, definitely firms that are going to 2 days WFH. Those firms will get the better people over time. I know because I am moving to a firm that is doing just that.

      2. vlade

        Re the broadband – I’m not dismissing it as such. There will be always places w/o a good internet connection, so WFH from a mid-Alaska cottage is not likely to be ever viable.

        But for most, it’s a transitional issue IMO. But otherwise it’s similar to commuting etc. – i.e. does the place you want to buy have WFH capabilities? And those that do (where WFH will be a viable option) will get premium put on them, same as those that now offer good commuting.

        Except that good WFH capabilities are easier to create than good commuting ones, so again, if WFH becomes a possible and attractive option, developers will take it into account.

        1. Yves Smith Post author

          Sorry, you do not understand the poor state of broadband in the US. We have crap duopolies and they don’t need to give decent service. I have mediocre download speeds in the biggest city in Alabama, dominated by the university, the medical industry, and banking, in a very affluent close-in suburb, in the top 100 Zip codes in the US in educational attainment. This is with no one but me using the computer and regular outages.

          There were stories about people from NYC going to Maine and I can assure you broadband is lousy in Maine. Etc.

          1. vlade


            All I can say about that. The former Soviet bloc had telcos monopolies, and I know from experience that they successor companies are extemely lousy at providing any good service.

            But a lots of smallish operators (serving tens of thousands clients) showed up that provide internet access by high-bandwith wireless (to your router at home, from which it’s up to you whether it’s wire/wireless or a combo), which, from infrastructure perspective (and capital investments), is pretty simple and quick. Basically, the only restriction they have is getting an access to a high-capacity node they themselves can connect to, and a license to use the spectrum locally.

            I have a dedicated 50mb download rate/20mb upload rate connection right now, with unlimited download/upload capacity, costing around 25EUR (which is actually on the more expensive side). And I was just today commenting on their customer service, where not only they listen, but they actually call me back and explain the cause of the problem (if there was one on their side) and steps taken so that it doesn’t happen again.

            1. Yves Smith Post author

              One place where you get great residential broadband speeds is Langley, VA, home of the CIA.

              But in lots of places, the not wonderful state of residential broadband is a feature, not a bug. If you bitch and moan about an outage, they tell you to get a business account. But guess what? In my NYC apt, that was not available! I haven’t checked here because I assume not plus it annoys me to have to reward them for mediocre residential service.

              1. Cynical Engineer

                I live in an outer suburb of Boston, and the Internet service here isn’t great. Only one real option, and I HAVE their business-grade service. When I first moved here 20 years ago, my only high-speed internet option was a T1. (>$1k/month)

                With my current service, it took two months of complaining and three service calls before they managed to fix the 5-10 minute daily outage at 9am and 9pm. They still don’t have IPv6 working properly. My initial support calls on that came close to “What’s IPv6?”, and they don’t have it working properly almost a year later.

                Bandwidth is decent 200mb down/30mb up, but expensive….$140/month.

          2. PlutoniumKun

            Its been quite a few years since I was in any non-big city in the US, but when I did travel a bit I was astonished at how terrible both broadband and mobile phone links where, even in mid sized towns. I’m told its not much better now.

            Its a very patchy thing worldwide. In most of Europe in my experience its pretty good, but not outstanding in most places. Even small villages in Portugal have pretty good links in one way or another. China is very good – I was pretty surprised when travelling in Tibet 15 years ago to find very good mobile phone connection in remote areas very far from any city – at least close to a road. South Korea is amazing of course, while Japan is surprisingly poor with wifi, although there is usually reasonably ok 4G phone links even in quite remote rural areas.

            1. barefoot charley

              Wifi in rural France is bad enough to help motivate the recent jilet jaune uprisings, and for lagniappe the signals don’t penetrate stone, so millions of cute little cottages get little to no signal regardless. I was shocked that French infrastructure could work as badly as American!

              1. The Rev Kev

                It is a tradition carrying on this. Decades ago the French telephone network was so bad that it became an international joke.

            2. Keith Newman

              @PlutoniumKun (9:38)
              I had a similar experience in a small village in Kenya last year. The wifi went off but I was able to establish a very good mobile phone connection and run my laptop off it. I don’t know if this would be sufficient for a Zoom connection.

          3. Mike

            Tesla Starlink will provide a significant shift to remote working shortly allowing zoom calls from Satellite in near earth orbits…..if they can get the price right!

  3. Jesper

    Suppose we chose not to run our economy, our lives, our government etc with having keeping CEOs happy as the number one priority?
    I get it, CEOs want things. If we asked them then they’d probably say that lower wages, longer working hours, no paid sick leave etc etc are needed because….
    But the views of the CEOs might not match the views of the majority. Their views might not be good for society, might not be good for the environment.

    As mentioned above, working from home might not be for everyone and it might not be for everything. Flexibility is probably the right thing to do.

    & about promotions: Not everybody wants to be promoted. Some might prefer not commuting for two or more years for the chance (not guarantee) of promotion.

    I am surprised about this:

    In fact, new research from the University of Arizona shows 40% of employees who were working from home feel disconnected from the company’s strategic direction and one-third feel like they don’t get support from bosses, according to Joe Carella, assistant dean of executive education at University of Arizona’s Eller College of Management.

    Does that mean that 60% actually feel connected to the strategic direction? if so, how does the 60% compare to the people coming into the office?

    1. Yves Smith Post author

      Companies are not democracies. You get paid to do what you are told.

      Not wanting to be promoted is ultimately wanting to be fired. People who are passed over for promotion too many times are seen to be losers, even if they have the character defect of really liking their current job and not wanting to become a boss.

      Not manifesting interest in advancement is a sign of lack of ambition and/or insufficient insecurity. Now some smaller employers with only one or two boss types would love workers who don’t want to be paid much and don’t want to advance, but we’re talking about generally larger enterprises here. And those smaller cos are very much creatures of the whims of the (few) top dogs and also tend to be unstable economically.

      1. KommieKat

        I think that the attitudes of younger “millennial” and post-millennial employees may not accord with this sort of “up the organization or out” feeling. The participation in and acceptance of a dog-eat-dog hierarchy is (1) much more typical of finance than of say, IT, and (2) much more typical of our older generation than of the younger employees I know.

        Just as employees might be skewing positive on working remotely, just as surely CEOs are taking a negative tack since every person working remotely is one less person under their complete control.

        1. a different chris

          >under their complete control.

          And I also think that the “out” is being underrated as part of an overall career strategy.

          Why do they want to go “up” Organization A when they can get refreshed *and* likely promoted by moving to another company (a competitor in the case of California which doesn’t allow no-compete agreements)?

          The threat of being able to leave for “greener pastures” just by logging off one account and logging into a new one is way better than trying to out-brown nose Susy and Sam.

        2. cocomaan

          As an older millennial that started interviewing for my first real job in 2008 as the stock market was crashing and layoffs were going fast and fierce, I think I can speak for millennials in saying that “career advancement” is a bit of a joke. A friend of mine, for instance, a few years younger, just got “promoted”, but it involved only a small pay bump at the same time the company was eliminating 401k match, “because of Covid”.

          Covid is the second major crash of my career, happening a little over a decade since the first one. It’s probably worse than the great financial crisis. A lot of folks in my generation are thinking about career as a matter of survival, not advancement, and with good reason.

          I also think that the rise of a labor movement in this country isn’t being considered enough. Lots of possibilities flying around and a lot of angry people could push the needle on labor power soon enough.

          1. NotTimothyGeithner

            “career advancement” is a bit of a joke

            My gut is the appeal of NBC’s “The Office” is the fantasy of job stability.

      2. Anonapet

        Not wanting to be promoted is ultimately wanting to be fired. Yves

        Not where I worked. The technical environment was demanding (and required knowledge of obsolete computers/languages) and the management knew* how dependent they were on people who could actually do the work. In other words, there were people who chose a technical path (the ultimate being a technical staff position) and those who wanted to “manage” people.

        And God knows, the technical people despised** those who sought mere positions of power with little care if they were qualified or not.

        * with the exception of HR.
        ** Somewhat like “Lions led by donkeys.”

        1. Yves Smith Post author

          That’s a fair point. But most companies are filled with people who don’t have strong (and narrow!) technical chops. They started out with generalist skills (even if you majored in something technical-looking, unless you got an advanced degree, you will still develop most of your work-applicable knowledge through your employer).

          And as a friend warned, “Specialization of diet leads to extinction.” That’s the risk of deep and narrow expertise. Jamie Galbraith made the same argument, long form with lots of supporting data, in his book The Predator State, that there was a lot of value in young people acquiring generalist skills, like being able to write well, computer/spreadsheet competence, basic taking on of tasks and learning how to deliver on time, learning critical thinking, learning how to vet data, basic presentation skills, etc.

          Sadly young people seem to think that questioning what others say is rude. My older buddies have noticed that young people seem to interpret give and take as conflict.

          Back to Galbraith. He argued that as BA degrees became more common, more young people started engaging in an educational arms race via getting advanced degrees. He argued that the number of people making that costly investment ($ for tuition plus loss of employment income) was bad for them collectively and societally. While BA generalist skills can be applied in many settings, advanced degree skills limit your options. You get higher pay but with much greater career precarity, since if conditions in your field change and there are suddenly fewer positions, your fallbacks are limited and usually entail a big fall in pay, work content, and status.

          Unless you are lucky and have friends who will give you a decently paid post, the fall is precipitous. And even worse, many employers will reject an accomplished worker in a lesser role because they are overqualified, which = difficult to manage because too smart/savvy and likely to quit as soon as anything better comes along.

          Yours truly is a classic example. I had a client describe me as having an “aura of burning rubber resume.” My highest and best use in terms of my technical skills is advising capital. Instead I am making a shit ton less as a writer.

          1. a different chris

            >You get higher pay but with much greater career precarity,

            I always shake my head at how hard it is for technical Phd’s to make a living. The story about that mRna scientist whose career basically was being disconnected from life support until Covid hit is just ridiculous.

            Plenty of money for college administrators (so far, hat tip Galbraith’s observation of market insanity) though.

            1. MichaelSF

              5 or so years ago a friend who has a PhD in biosciences and a JD for patent law was out of a steady job for about a year. I mentioned how surprised I was that someone with those kind of credentials wouldn’t get snapped right up, but he said the PhD/JD wasn’t at all uncommon. That seemed pretty scary, especially when considering the time it took for him to go to law school and then several attempts before passing the bar.

      3. Jeff

        “Not wanting to be promoted is ultimately wanting to be fired.”

        This is nowhere near a universal truism.

        I’ve been a headhunter for 25 years and you might be surprised at the number of people who enjoy what they do and have no desire to climb the corporate ladder.

        Work/life balance has been prioritized for a large percentage of people. Fulfillment in their job and sense of accomplishment and contribution are more important for A LOT of people.

        WFH has its downsides – no debating that – but some of my clients have shared they’ve seen productivity rise during COVID. Whether that’s a short term gain due to everyone going through it or a long term trend will be learned over the next couple of years.

        My sense is that long term wfh success is HIGHLY dependent on leadership getting good at leading remotely. I don’t see hr taking a lead role yet. That’s the most clear failure point right now.

        1. cocomaan

          I’ve been a headhunter for 25 years and you might be surprised at the number of people who enjoy what they do and have no desire to climb the corporate ladder.

          The key to overcoming your own “Peter Point” (https://www.investopedia.com/terms/p/peter-principle.asp) is understanding when you’ve reached the limit of your competency. For me, that took being in charge of an operation, being miserable, and moving back down. Humiliating, I thought, but actually, it was a blessing.

          What I found out is that I’m an excellent second in command, excellent as the kingmaker, rather than the king. Commander Riker, not Captain Picard, for me. Being Captain takes a toll on my life, where being Riker means I get to play trombone and date Counselor Troi.

          1. eg

            I’m with you. I looked seriously at the top job and concluded that it wasn’t worth the aggravation of dealing with the Board.

        2. PlutoniumKun

          I know of very many people in this category, its one thing that makes me quite skeptical about raw figures about gender breakdown in companies (I’m not saying there isn’t discrimination, its just that the figures produced never seem to delve into how much people actually wanted to climb the corporate ladder).

          Its particularly common among technically oriented professionals or skilled manual workers. In a conversation once with my four siblings (all of whom fall into one of those two categories) it turned out that all of us at one time or another had turned down promotion opportunities because of the crap involved from going from fairly ‘hands on’ working to pure management roles.

          1. vao

            Several large technology-oriented corporations (engineering, IT, medical, etc) recognized the issue long ago and instituted the “dual ladder” career track — one for management, another one for technical people.

            In one of my previous jobs where such a scheme was in place the joke was that career advancement meant spreading your legs and climbing one step of each ladder in turn. But in essence: yes, there were such dual systems, and one could actually make a career (with much less responsibilities, and generally less money than managers) by sticking to the technical path — leading up to becoming a “Fellow” (like “IBM Fellow”, “HP Senior Fellow”, “ABB Fellow Engineer”, etc). With all the externalization and offshoring, I do not know whether those dual tracks still exist, though.

            And yes, I worked in an environment where even trying to entice some people to become group leaders (the lowest rung in the management hierarchy) led technical people to recoil in aversion at the prospect of being involved in “management”.

      4. Mikel

        “Not manifesting interest in advancement is a sign of lack of ambition and/or insufficient insecurity.”

        Please expound on what you mean by “insufficient insecurity.” I think I know what you mean, but not sure.

        1. Yves Smith Post author

          I should have said “Not manifesting interest in advancement is seen as a sign of lack of ambition and/or insufficient insecurity”. Perils of writing comments way after my usual bedtime.

          But to continue the thought, too many managers like workers who are insecure, which can show itself many ways, such as overdoing or being a suck up. If you are confident but don’t want to advance, some bosses can find that threatening, since you are less manipulable than those who want to advance or are afraid of being fired.

  4. PlutoniumKun

    I’ve mixed feelings on this. I’ve no doubt many senior managers and CEO’s are determined to get people back to the office, but I think there are a number of other dynamics going on.

    One is office space. Even quite early in the pandemic I know of one major international insurance company based in my city that decided to cut its office space by a third – the decision was accelerated by an upcoming lease. It simply didn’t renew one of its major office spaces and saw telling a chunk of its employees they could work from home indefinitely as a good trade off for the rental savings.

    Another is recruitment. I know anecdotally of some companies that had struggled with reconciling recruitment needs with wanting to be HQ’d in very expensive cities that they’ve seen formalizing working from home for certain types of staff as a good way to square the circle – or put another way – they can recruit qualified staff without having to pay them more to compensate for very high living costs in somewhere like SF or London or Singapore. This has been complicated though by a variety of legal and tax issues (in Ireland, companies have been told that their staff must reside in the state if they are not to find themselves the wrong side of various tax requirements – this is a big blow to a lot of IT people who dreamed of living in a little surf village in Portugal while keeping their high paid Dublin job).

    Perhaps others could join in on this, but I know a number of IT workers who say that so long as they have the correct home set up, they’ve found working from home far more efficient. They’ve found that the zoom meeting thing has settled down, and actually works very well with companies operating over different time zones. A friend who works in a local Dublin office for a Canadian health care company says she simply builds it into her normal day now that she has a late evening zoom meeting for an hour with her managers in Vancouver, while previously it was nearly impossible to do this under normal office hours.

    Again, anecdotal, but I think some senior managers and tech people find they quite like not having a long commute and if they have sufficient internal power and may well find they have enough clout to simply refuse to accept an instruction to return to the office full time. A CEO may want this, but if half his best staff say ‘no’, especially in a strong job market where replacing them will be difficult, he may have no choice.

    That said, I don’t disagree with the general thrust of the argument that a lot of people who have settled down quite nicely to home working and may even have moved to a nice rural area on this basis, may be a rude awakening in 6 months or so when they are told that there is no ‘new’ normal, just ‘normal’.

    1. Yves Smith Post author

      According to the Census, there are 3 million people employed in IT, which is less than 3% of total employees in the US. They aren’t representative. So your sample isn’t indicative of the typical company. More than twice as many work in finance.

      1. Jeff

        It will be interesting to see how those in finance (and legal, hr and accounting) react when they see many of their coworkers in IT working remote post Covid.

      2. neo-realist

        About 25% employed in IT in the Seattle area. However, FWIW, Microsoft re-opened their offices at the end of March. But the company is still allowing for work at home as the virus conditions dictate.

        l don’t work in IT, but my company’s office will possibly open in the fall, depending on virus conditions/infections and what the Governor says. But it may allow for some work at home depending on how uncomfortable the employee or employees are with the virus conditions.

        Personally, I don’t miss office politics, small talk, glaring managers, and crowded transit commutes, so I could keep doing it for pretty much the rest of my working life. Too old to care a lot about moving up the ladder in the office, and too exhausted from competing to get inside of the door of the office.

    2. ChrisFromGeorgia

      I am an IT worker and have been WFH since March of 2020. I just took a full time remote position.

      Some observations:

      There are challenges. It can be isolating and the point made by the author about being less likely to be promoted rings true. At my career stage it is not a big deal and worth the tradeoff, but if I were 30 maybe I would look at things differently. My home network is very stable and other than a few days last year when we had the remnants of a hurricane blow through here, has not been down more than a few hours.

      The biggest challenge I would say is the missing human interaction, the water cooler talk (though some of that was gossip and non-productive) and “face time” with others.

      However, even before the pandemic I noticed that the office just wasn’t the same. My prior two jobs were for larger companies in some mode of “right sizing.” The office went from a fairly vibrant place to ghost town over a period of months, leading to a situation at my last job where the office was so deserted that I felt depressed just walking in there. I suspect the combination of out-sourcing, globalism and delegating work to contractors has resulted in many companies just not having enough core workers in one place to generate a critical mass of employees that would yield a vibrant office culture. At least not without reducing the square footage and maybe terminating some leases.

      That is happening here in Atlanta, BTW – a big bank (Suntrust) announced that they were terminating leases for a bunch of office space downtown.

      On the other hand Microsoft seems to be moving ahead with a new campus downtown, despite the fact that asking workers to relocated seems odd now.

      I tend to agree with PlutoniumKun that the CRE aspect may be key here. The cost savings of reducing footprints may be too tempting to the CFOs. If interest rates rise in the coming decade, that is going to put pressure on CRE landlords to raise rents and that kind of cost inflation is a risk to any business.

      I realize finance is another industry altogether. I suspect that their deep ties to the CRE industry may play a role in how hard headed they are about forcing people back.

      1. Mikel

        I forgot to add that in my long post below:
        We had a whole floor of a high rise previously because of the numbers of employees. Another reason for seeking new space other than lease ending and pandemic was that there had already been considerable cuts to staff over the past 2-3 years.

        And some of the cuts I thought were very ambitious, social, connected, and hard-working.

    3. Mikel

      Just before the pandemic, my employer’s lease was expiring. They had been looking at spaces and talking to staff about space and new locations. The lease at the current space was only going to get more expensive at that time.
      The new office was to be smaller…and still that open space but everbody in the same room type of vibe.

      In the set up we were in, it was an entire floor. On one side, the open space layout was a bit different than the other. While both had open floor work areas, one side had workspaces with people barely an arms length stretch away and on the other side the people in the open floor area were separated by considerably more space, with large table like areas separating them.
      There were offices for executives.

      Now, as the new space was being discussed the biggest fears were from the execs who felt they might be forced into an open space area and no longer have an office and the people on the spacier side dreading the lack of elbow room (now added to the loss of any other semblance of any temporary personal space).

      Pandemic hits. Building starts throwing out the discount offers while the work from home starts.
      They end up just leasing a part of a different floor, mainly using for storage as now the search for new office space brings cheaper opportunities.
      As of now, no new lease has been signed, while the company is having some of its best quarters ever. So they are on a high and understand that work from home has its drawbacks, but they can be more choosy about a new place and the performance has them a bit calmer about the work from home situation for now.

      Here’s the thing. I don’t think this pandemic is over, nor do I think it will be the last one in the near future (say within 10 years.) And while I don’t think they have gotten over this open space everybody in a room idealization, I’m getting the sense that they are understanding that everybody doesn’t need to be in the same room at every minute of every day, crowded in. But a place to get together when needed is the ideal…along with a place to get away to when needed.

      Fingers crossed.

  5. Anonymous

    Yves, thanks as always for this informative piece.

    While I don’t question the What of this story, I do think it leaves out one really big cause Why: the psychopathic leanings of our ruling class. As my better half elegantly sums it up, “They want to be back in control.” It’s simply too hard to abuse people when they’re not there in person. It’s much easier to keep them under your thumb when you can once again force them to be under your nose.

    Like many, in recent years I was pushed into gymnasiums full of desks or long tables eyeball-to-eyeball with colleagues, despite holding HIGHER positions than in prior years when I was given a proper office, then a fabric-walled cubicle. It was like the fellow in Office Space who ended up in the basement. As you know, my experience was thoroughly average. But what I always found fascinating was that management’s rationalizations about “camaraderie” and “communication” never applied to them. They kept their private offices. Somehow, we got more productive when stripped of our dignity and privacy, but they didn’t. I dunno, maybe they’re just inherently unproductive anyway and thus figured any productivity enhancements were lost on them. Not that they’d be wrong, mind you. But I think Occam’s Razor identifies the real driver here, unchanged from prior decades: simple sadism.

    1. Thistlebreath

      Spot on.

      After a lifetime of mostly freelance journalism, copy writing, then writing or producing entertainment, the circus/carny template has just been a given for whatever “teams” I ever joined for a while.

      There was a 10 year enlistment at a big studio, then back to the ebb and flow of job by job relationships.

      That studio interlude made life in the court of the Borgias look like day care. In the end, only a few scheming Scheissweasels made it to an uneasy throne — to find the crown still hid the odd thorn in it. I wuz long gone before I ever got invited over to the edge of the roof to admire the view.

      Anyone who wants to open the NYT or LAT (or Hollywood puffball press) these days can read about what it was like to to work in Scott Rudin’s office. His style is nothing exceptional save for getting outed recently.

      Where would all the fat cats go if the mice decamped back out to the Great Wild Wood?

      Or put another way, like Ned Beatty showed in Paddy Chayefsky’s brilliant “Network,” the Howard Beals of the world might find themselves on the listening end of “the talk.”

    2. TJFinCO

      It’s simply too hard to abuse people when they’re not there in person. It’s much easier to keep them under your thumb when you can once again force them to be under your nose.

      Control is part of it, but I think a bigger issue is a lack of effective middle management in general. My resume is lettered with positions where I was the primary mentor, scheduler, and de-facto “manager” of teams of new and/or inexperienced workers, with the actual manager contributing next to nothing and taking all the credit for the positive results. It’s not always “control” that the middle management wants, it’s to show the next level of management up the ladder that they are the driver of successful projects or tasks, therefore justifying their own position in the firm. Everyone has a boss to answer to except the guy at the very top (or “gal”… but probably “guy”). If the work can get done profitably in a partial or full WFH setting with little direct eye-to-eye supervision, then why do we need the manager?

      In typical white-collar firms of more than a few dozen people, the highest level of decision-makers are far removed from the production-level workers. They higher-ups rely on reports from middle managers to ascertain what’s going on below (if they care at all about anything past the revenue and/or stock price). If the middle managers tell them they need butts in the seats to be successful, the WFH will end pretty quickly.

      I agree with the basic premise of the article. I would be very surprised if the post-Covid office looks much different than the pre-Covid office in most white-collar industries.

  6. Synoia

    Sales people, generally ambitious, working from in remote offices, want to move the the “Head Office” to get more visibility and promotion prospects.

    In the The Military, being transferred to HQ, from a muddy foxhole, is viewed as a career boost

    The Military has a long history of this basis for promotion, as so Sales people.

    Any statement of “I’m conformable where I am” is generally seen as and admission of laziness.

    Yves is correct: Out of Sight, Out of Mind, Out the Door.

    1. Tom

      For certain types of work, Yves is undoubtedly correct, but not all jobs are front office sales-y type jobs. Does it make sense to have IT, project management, operations, and data roles on site all the time? There are senior managers in these fields as well who are perfectly happy where they are and would rather forgo the stress of a long commute while continuing to earn a six figure salary.

      Now if you’re young, fine, you should absolutely go into the office as often as you are able for career prospects. But if you are older and have topped out on the ladder, it doesn’t really make sense, does it?

  7. Tom

    Yves, I think there are some good points made above, but I ultimately think a hybrid work approach will prevail in some form.

    In my own career, remote work really took off after Sandy. Lower Manhattan was completely flooded and office space was entirely unusable for several months. Many companies within the financial district (I realize there are fewer now than back then) began executing “business continuity plans” (BCP) in the event that a similar disaster would occur in the future. At the time, this was largely seen as a sporadic event that would probably never occur again. Indeed, New York City was lucky that after 2012 it did not experience a comparable natural weather event, but it’s clear that this probably will not be the case going forward. I personally would expect an adverse event to happen at least once a decade in Manhattan if not more frequently.

    After Sandy, companies started to look more seriously at allowing employees to work remotely because they started developing the technology (webex, cisco, zoom, etc.) that would allow them to fulfill a BCP. The culture where I worked was already very much a “hybrid workplace” pre-COVID and there were few problems. Indeed, most workplaces effectively function and collaborate between several different locations anyway (New York, Chicago, Dallas, SF) that it’s hard to see how adding one additional remote work employee compounds logistical challenges all that much.

    I agree that working remotely can set you back career-wise and it was often older people in established roles who took advantage of the opportunity to work remotely several days a week. However, the real estate footprint shrank and even pre-COVID there were fewer seats than there were employees, something other companies are only contemplating doing now.

    In the future, there will undoubtedly be increased natural weather events within central business districts in addition to pandemics, terrorism, and other risks. In this day and age, it just does not make as much sense to have hundreds of thousands of people crowded into a few square miles even if productivity is marginally higher. Notice that the only companies really signing larger floor plans are tech companies with large balance sheets.

    I believe a large part of the backlash to the remote work comes from local governments (who depend on property tax revenue), real estate owners, and pension and insurance funds. The costs of full remote work would probably be catastrophic for many local governments as the value of real property falls and workers pay less in income taxes, butI think in the future we will move to a tax system similar to New York State where your physical residence does not matter for the purposes of taxation, only the location of the office your company is based out of. On the back end, companies within the FIRE section will probably receive some sort of tax benefit to remain within prominent CBDs (I have heard the financial companies receive $30 billion in tax benefits to remain in New York) and there will also be some informal understanding between bank executives that they have an obligation to remain in New York (“civic duty”). Otherwise, they will maintain some presence, but cut office space as much as they reasonably can.

    This was even occurring prior to the pandemic. Goldman Sachs has back office teams in Tampa, Salt Lake City, and Dallas instead of the Greater New York Area.

    1. ChrisFromGeorgia

      Notice that the only companies really signing larger floor plans are tech companies with large balance sheets.

      Good observation that squares with my anecdote about Microsoft moving ahead with a big campus near downtown Atlanta. Also I heard that FB invested in some empty office buildings somewhere, maybe Seattle or NY.

      I suspect these big tech companies are simply playing the real estate market, hoping to snatch up some office space relatively “cheap” (or build it with huge tax breaks from stupid local governments) that they can “flip” later in the decade. They have huge amounts of cash on the balance sheet with nowhere to put it, save stock buy backs or really crummy interest rates in safer investments.

      1. Tom

        Wow did not see the Atlanta/Microsoft story, but this seems to be exactly the paradigm.

        Large, well capitalized tech company buys undeveloped land near MARTA station for $22.5 million…literally peanuts for a company with $130 billion cash on hand.

        At the same time, less well capitalized startups like DropBox are in the news for subleasing 472k of their 750k headquarters in SoMa as they move to fully work-from home. REI, the outdoor apparel retailer, recently sold a newly constructed HQ in Kent, WA to raise cash.

        This hits different markets differently. Amazon, Facebook, and Google have all signed leases for Class A++ buildings in New York City (with the exception of 410 10th, but it’s close to Hudson Yards), while older more established companies are in the process of shrinking real estate prints.

        I think it’s important to keep this distinction in mind when quoting CEOs. Yves quotes Google, Netflix, and a robotics firm. The former are FAANG stocks and while Netflix does not have the cash of Facebook, Google, or Amazon, it recently achieved sustained profitability and announced that it no longer expects to borrow to finance expansion. Similarly a robotics firm is probably a bad representative of the new paradigm since they probably operate in specialized R+D space that can’t be replicated remotely.




        1. Tom

          As a side note, real estate news headlines in the media during COVID have been hilarious.

          It only takes, say 10 people moving to a small Vermont down and bidding up the prices of several listings by a few thousand dollars for there to be a MASSIVE EXODUS OF NEW YORKERS FLEEING TO PASTROAL VERMONT IN THE MIDST OF THE WORST PANDEMIC IN 100 YEARS.

          There have certainly been some moves out of the city, but the point is it’s very easy to raise prices in thinly traded markets where there are few buyers and sellers in the first place.

          Similarly, Microsoft spending $22.5 million on land in Atlanta probably does not warrant the headline TECH BEHEMOTH CREATES THOUSANDS OF NEW JOBS IN EMERGING ATLANTA OFFICE MARKET.

        2. ChrisFromGeorgia

          As a side effect, that area around the Microsoft ATL real estate play (English Ave.) will become further gentrified. The unaffordable housing that gets built will push out a bunch of middle/lower class folks who gave the area its character. Disaster capitalism 101.

          An aside – I am not sure how MS plans to fill that office space, or even if they intend to. Relocating employees seems unlikely, perhaps they intend to hire local Georgia Tech and other university grads who would be more willing to live in that area and not face long commutes from the ‘burbs.

      2. Michael

        In August FB leased 730,000sf in the Penn area of NYC from Vornado (VNO)
        In Feb Apple subleased 336,000sf in same area.
        VNO is very bullish on this area for tech.
        FD: I own VNO

        1. Tom

          The key word here is “sublease.” Apple subleased 336k square feet from Macy’s in 11 Penn Plaza for a period of only six years, whereas Macy’s has an outstanding lease on the space through 2035. Effectively, Macy’s is cutting its own fixed costs by ridding itself of a portion of the lease, while Apple will happily take this on because they can get okay (I don’t think it’s the nicest building) office space with good accessibility (it’s next to Penn Station) in the mid 60s per square foot.

          Apple might renew in the area ($5 says they won’t), but this does not really benefit Vornado immediately as they are still receiving rent from Macy’s as the prime tenant since Apple does not have a direct lease.

          Again – the same pattern of well capitalized tech companies expanding real estate food prints because they can park the cash, while more traditional companies without the balance sheet are shedding fixed costs.


  8. Paul

    One thing I find interesting about this article is right in the lede: “After the Covid Era”. I’m not sure I yet believe in the assumption that there will be an “after”. I say this for many reasons:
    – Coronaviruses are endemic; think flu and common cold. Will we squash this particular variant? Will the vaccines actually work as planned? I’m not sure yet, and certainly the medical opinions are varied.
    – This is the biggest power grab by .gov since the beginning of time. Government power always ratchets up, but never comes down, at least until it topples due to its own weight. I don’t see .gov giving up this power anytime soon, and will continue fear campaigns, rolling lockdowns, new ways of demanding “papers, please”, and other intrusions. Keeping the pandemic going is beneficial to their power objectives.
    – I still remember 9/11, the emergency measures put in place. Yet 20 years later we will have TSA checking shoes. Emergencies make great power grabs.
    – I also still remember 2008. 13 years later we still have emergency interest rates.

    I think the assumption that .gov will release us from this emergency is invalid. Historical precedent says otherwise.

    1. Anonapet

      13 years later we still have emergency interest rates. Paul

      Low (actually ZERO) interest rates are good unless several major religions are dead wrong.

      The question then is HOW low interest rates shall be produced in an ETHICAL manner.

      Hint: Government privileges for banks and the rich is NOT the way to ethically lower interest rates.

  9. Biologist

    WFH saves money in commute, but (depending on local climate) adds substantial costs of heating or AC which are normally off during the day.

    I moved to a slightly cheaper area (within the UK) but the extra heating costs are high! On the other hand I save money (but not time!) by cooking my own lunch rather than sponsoring the local deli.

  10. a different chris

    I mostly agree with the article, maybe completely. But this made me laugh in two ways:

    >collectively deciding to work remotely on Mondays and Fridays,

    Laugh one: Yup, that’s exactly the agreement I made. Going back to in-person work next week, in fact.

    Laugh two: The whole world would be better off if we all just worked Tues, Wed and Thursday. Screw 40hrs/week. Most of the crap we do doesn’t actually need to be done and is actively harming ourselves and the planet that houses us.

  11. Keith

    I have been working from home since 2012, but during the pandemic I had to switch jobs to one that was office but, but teleworking for COVID (transfer was due to problems with new boss). One issue (there are a bunch I can take issue with) is that my current organization seemed to set itself up for failure. Their attitutde from the beginning was this is temporary, so we will limited the work type to less important items until they can get back in the office. Further, they did not supply their employees with any equipment to operate a home office. Then they tried to recreate the office through constant zoom-style calls to get facetime (sometimes it seems they are just chasing tech on this, to the point where a simple phone call needs to be a video call).

    On the employee side of the house, very few attempted to create a workspace for themselves; as an experienced teleworker, I have a home office. Employees also constantly complain about not being in the office and needing to be with people and go out to eat and hang out, etc. The irony here is that the majority of the work we do is on the computer, creating records, inspecting programs, etc. While meetings with the people being reviewed are helpful in person, we do not need an office for that.

    In short, I think a lot of the telework pitfalls are related to self sabotage and people needing their work to act as an outlet for their social life.

    On a side note, the neediness of the people at this organization for attention has me loathing returning to the office and hoping the pandemic lasts a little longer. I am polishing my resume. I usually look to bounce after 3-5 years at an organization, but these people are going to drive me nuts with their live to work mindset.

    1. neo-realist

      On the employee side of the house, very few attempted to create a workspace for themselves; as an experienced teleworker, I have a home office. Employees also constantly complain about not being in the office and needing to be with people and go out to eat and hang out, etc. The irony here is that the majority of the work we do is on the computer, creating records, inspecting programs, etc. While meetings with the people being reviewed are helpful in person, we do not need an office for that.

      In short, I think a lot of the telework pitfalls are related to self sabotage and people needing their work to act as an outlet for their social life.

      On a side note, the neediness of the people at this organization for attention has me loathing returning to the office and hoping the pandemic lasts a little longer. I am polishing my resume. I usually look to bounce after 3-5 years at an organization, but these people are going to drive me nuts with their live to work mindset.

      The second in command at my firm in a recent zoom type meeting talked about how much he missed being around people. The first in command in a long ago zoom meeting said that he felt lonely with so few in the office…..mostly senior managerial personnel. We were provided a life coach/counselor to use if we choose to so as to talk about our struggle and suffering with working from home……errr. People who get a life in part from working:/

      Hardly anybody has spoken well of working from home and I suspect that the many who do like it won’t talk about it for fear of having it blow back in a bad way socially upon the eventual return to the office.

  12. Dave in Austin

    Here are the varieties of work as I see it and how they relate to “work at home” vs “go to the worksite”:

    IT and engineering work have commonalities: 1) productivity is verifiable; 2) managers can evaluate workers by output (lines of code) not input (perfect attendance, great degree, pleasant manner and personal attractiveness); 3) the workers have had an education which is likely to require internal self-discipline; 4) high economic value/employee. Such folks are good candidates for “work from home” jobs

    Most finance, insurance and retail jobs are not “high education, work on your own” jobs. They are either customer-facing or require adherence it detailed rules and processes. Most workers in these jobs can’t easily work from home.

    Manufacturing, both high-tech and low, are “show up at the factory and work” situations. And we may see more of these jobs in the near future.

    Finally, much installation work and many delivery and customer service jobs in the U.S. are done via “subcontractors of subcontractors”. These are all “show up at the workplace” jobs and have effectively turned into an anti-union, drive-down- wages-and-benefits bidding war machines. And the system is a convenient way for large companies- and whole industries- to employ the vast army of low wage immigrants being brought into the U.S.

    When I say “vast armies” here are this year’s numbers. Roughly four million people turn 18 each year in the U.S. I’d estimate based on the Dreamer age profiles that 10-25% are illegals. In March, 2021 172,000 people entered illegally from Mexico; 19,000 of them were unaccompanied minors. So 12months x 172,000 people/month = 2,064,000 illegals likely to enter from Mexico this year, increasing the U.S. age cohort by 50% and doubling the percentage of non-Whites entering the labor force.

    Every major construction site in Austin is 100% Spanish speaking at the hardhat level and I’m guessing they are mostly illegal at the start. I have a country place 24 miles from Austin where many of my neighbors are these workers; generally hard-working, honest people. Two of these Spanish-speaking workers are here right now at my University of Texas-area Austin, TX condo fixing damage from last month’s 4 degree freeze. Nice guys; good workers. My guess is they make $14-15/hour. Great for me but I notice that lawyers, doctors and teachers have effectively protected themselves from such illegal and low-wage competition… for now.

    The losers are both the “white replacement” crowd and poor blacks and American-born Hispanics. Both the latter groups moved in the Trump direction in the last election. At this rate Tucker Carlson could be our President in 2024 with truly unpredictable consequences.

    1. neo-realist

      The American born Hispanics moved in a majority in the Trump direction, while in spite of the fact that poor blacks registered a small uptick to Trump, the clear majority of them saw him and his folks as an existential white supremacist threat and voted against him.

      Tucker may not want to dirty his suit with a presidential candidacy, but if the voter suppression in 43 or so states goes full tilt boogie by 2024, some other members of his tribe will have a really good shot.

  13. Thuto

    I have to wonder whether appraising the long-term viability of WFH from within the eye of the covid storm can yield any truly objective, reliable outlook on its prospects. After all we are only a year in and as such the calm AFTER the storm may be more conducive to the process of gathering “clean” data (i.e. untainted by emotions of relief from office employees liberated from long commutes on the one side and CEOs panicked from the loss of managerial control over the workforces on the other side, to say nothing of CFOs salivating at the prospect of reducing the CRE footprint). Anecdotally, I know people whose honeymoon phase with WFH is starting to fray, and they’re missing their colleagues and office life (even as they don’t miss the commute), and these are folks who six months ago thought they’d irrevocably nailed their colours to the WFH mast and were happy to declare as much to anybody within earshot. Now it’s almost as if they’re aware that the WFH hype(up) cycle just may have the dreaded “trough of disillusionment” (ala Gartner Hype Cycle) lurking on the other side of the pandemic. I’m not making any predictions on this one until the fog clears up.

  14. nick

    I think it’s clear WFH rates in for example 2025 lower than in 2020 and higher than in 2015. A lot of good comments in this thread about how big and how steep that change might be.

    One thing I’ll add is a consideration of changes in how symptoms of sickness are responded to. In schools and workplaces where there is substantial in-person activity right now (but where WFH is realistic), people are expected to not come in if they are showing even mild symptoms of Covid, many of which overlap with those of colds or flu.

    I’d expect these norms to persist, especially in schools as the timeline for vaccinating children remains unclear, but also elsewhere as variants arise and data start coming in about the length of protection afforded the vaccinated. In that case the infrastructure for at least partial WFH would need to be maintained, both for when workers get the sniffles and when they need to mind their sick children.

  15. ptb

    Weak link in the logic, IMO: “The majority of CEOs” is unlikely to correspond to “the majority of jobs”.

    WFH has a massive upside to big biz, in that it will extend the trend of relocating expensive office work to lower cost-of-labor places, whether inside the US or elsewhere.

    1. Michael Fiorillo

      If so, then the Fed is going to be buying a s”-*load of CRE securities and REITs in the coming years.

      The friction points here seem to be potential problems for large commercial landlords and CRE-exposed banks, and, secondarily, local tax bases. Mass transit may be thrown into terminal crisis, but this is America, so who cares? In some cases, it might be too much of a stretch seeing banks ordering their employees back to the office, as a self-serving model for other employers to follow.

      It’s also hard to imagine that a large subset of managers isn’t itching to get their daily doses of face-to-face sadism in…

    2. Yves Smith Post author

      Go look at the WSJ article. The companies dead set against work from home were skewed to the biggest employers, such as TBTF banks.

  16. Dandelion

    There is also a difference between WFH when schools are closed/no daycare available vs. WFH when schools are open/daycare available. Parents with children have essentially been doing two jobs simultaneously while working from home.

  17. leapfrog

    I am hoping that most of the recent Bay Area transplants here will be forced to return to work in the Silicon Valley. They have driven up the real estate prices so badly, that our community nurses, firefighters and teachers, among other professions, can’t afford to live here. Lots of visitors too, who pollute and dump their trash (thousands of pounds wind up in our rivers) when visiting our beautiful scenic area.

  18. Mikel

    I’m still not sure that pandemic conditions with everything around you closed was or is the ideal place to judge the “work from home” experience.

  19. Jeremy Grimm

    House prices are increasing in many areas for many reasons — work-from-home moves to lower cost areas and lack of inventory come to mind. At the same time shortages(?) of building materials, coupled with increases in home improvements and repairs have lead to price increases that may or may not ratchet in. I sense that in addition to other post Corona shocks, work-from-home employment, rents for office space, and house prices will experience interesting times. I still expect a lot of the work-from-home employees may find themselves replaced by more remote employees and contractors.

    I have trouble with discussions of productivity. In the work I did I have no idea how productivity could be measured — too much was intangible and the best measures management could invent usually measured the wrong things badly weighted. Training was catch-as-catch can self training, until that option was erased by waves of credential, specific past experience, and certification requirements made work as a self-trained generalist problematic. My impression of management thinking about employees was encapsulated in some of the magazine articles I read back when “All the Presidents Men” was a hot new item in the theaters. Many managers seemed enamored of the movie’s images of the newsroom sea of faces and desks. I also recall older co-workers commenting how many of our clients seemed intent on surrounding themselves with a visible workforce as evidence for their importance and as a comfort felt in how layoffs stood between them and the back door. I remain a believer in Mills’s Managerial Demiurge and the motives that concept suggests to me as primal drives for management thinking.

  20. Gregory Etchason

    The push to return to the office is simply supervisory panic. They’ll risk coworkers health to save their own skin. Many of the recent studies showing increased productivity at the office include attending meetings as a metric. Meetings are nothing more than supervisory job security. Most people have two screens at home and working during a Zoom meeting. At work meetings are “dead” time for getting work done.

    1. Arizona Slim

      Back while I was a university campus employee, I was telling my mother, a classroom teacher, about my boss’ job. It consisted of going from one meeting to another.

      My mother’s comment: “That’s not a job, it’s a sentence.”

  21. Anthony Stegman

    Since a good portion of companies out there, especially small and medium sized ones, are not well managed, I can’t see how much relative harm can come from remote and hybrid work. Studies that show otherwise seem to focus only on the well run organizations that generally provide lots of opportunities for meaningful work and promotions. For many workers that type of work environment is hard to come by.

  22. a different chris

    Anyway, this whole discussion is rooted in such a short segment of human history that it is like thinking about a Mayfly’s life and completely ignoring the part before it was able to fly. We didn’t have “weeks” as such, let alone hours, we had seasons and moon phases and the like. The simple truth is:

    If your job is to be part of sailing a three-mast schooner, then all hands including yours need to be on deck.

    If you are a novelist, then maybe you don’t need to retreat to Walden Pond but you certainly are best served with a lot of solitude.

    And everything else would naturally, if we were actually doing anything natural, scale in-between.

  23. Altandmain

    Like many of the others, I disagree with this article.

    Our CEO is saying we will have a hybrid option after the pandemic (a couple of days in the office and the other half at home) with some working more often from home.

    One company here in Canada, Shopify is going 100% at home.


    I think that the companies not offering work from home at least on a hybrid basis are going to have very high turnover and are going to struggle to attract white collar workers who have options as far as jobs go.

    Yes, older CEOs who “need” to see their employees are in control and especially older mid level managers, but I think that especially where workers have options, namely in areas where the job market are good, they are going to have to be flexible. The companies that are 100% work from office might have to offer a higher salary to offset in a good economy.

    I think the real backlash comes from local governments that rely on commercial real estate property taxes, the REITs along with other commercial landlords, and others like banks with a vested interest in keeping people in the office.

    Another is that the companies that don’t embrace at least a hybrid model are likely to find themselves out-competed – especially if they can’t get top talent or in lower margin industries, have to spend money on wasteful commercial real estate.

    My employer, an automotive supplier is going hybrid after and it is a manufacturing company. Same with Ford for its white collar workers.


    So it’s not just industries that are “easy to work from home” – it is white collar in many fields.

    1. Tom

      I think your last point there brings out another interesting dimension in the discussion.

      Why would any employer at this point not allow a new hire to work remotely as a concession during the hiring process? In the past, most jobs were tethered to one office and employees had to relocate across the country just to join a new office. It seems to me that this changes over the next few years as there are at least some companies that start to offer more flexible work arrangements.

      1. Altandmain

        Ultimately, because of tradition more so than anything else is one reason to go 100% office. I think some managers just love looking down on people.

        In a survey done internally at my employer, 90% of workers and 85% of managers at my company said there was no loss in productivity with some being happier working from home, reporting even more productivity. People were less tired having not commuted to work (some live more than an hour away each way to work through car or mass transit) and others reported that they ate better (probably from cooking lunch at home).

        Part of the increases may be the loss of “idle” chat at the break room or water cooler (or whatever equal). Another is that meetings are more to the point, leaving workers to do more of the real work.

        Another may be that open offices themselves are quite bad for productivity. Companies insist that they are for building relations, yet managers are in offices. The real goal was always to save on real estate and watch workers.

        Yet another is that there is less office politics because we are not there in person. Interestingly, one of the biggest positives is that work from home disaster for those with a lot of skill at playing office politics, but not at getting serious work done, and those who had a great attitude along with social skills, so they were not let go of because they were “liked”, but who were not getting work done. I would like to see the first type removed, but the second type, I think maybe if companies can work with those employees so that they can improve, maybe we can see them improve, especially if they have a good attitude.

        There is one other factor not being considered here. Companies that go 100% work at office after the work from home situation are going to have to deal with a very unhappy workforce in many cases because now people know work from home is possible. Even if workers do stay, they may only stay due to the post COVID recession and leave when other opportunities with more flexible employers come along.

        I know I’m doing that if my employer insists on 100% at the office.

      2. Stephen

        This is 100% correct. At this point, offering work from home is a major competitive advantage over competing firms who are unwilling to be flexible enough to implement the policy on a full time basis.

        Firms should also consider the opportunities for labor cost arbitrage. All else held equal, the remote employee working from a home office in a lower cost of living area is a the better candidate than an on-site worker at your HQ in an expensive city. This in turn levels the playing field for individuals living in smaller metro in the hinterlands, because they can undercut competing labor and still maintain their household balance sheets.

        The market will determine the future of this type of work, not the desires of management. Any firm who doesn’t see the market dynamics and how to leverage them to advantage will be left behind.

        I agree, turnover at return-to-office firms will be high. As it should be. I suspect they will regret it.

  24. KLG

    If this has already been asked, sorry.

    So, your employer sends you the new laptop, docking station, keyboard, mouse, and 27-inch monitor to be used with your iffy broadband connection. No IT people to deliver it and set it up, but that’s OK. You can read the diagrams if not the instructions, which appear to have gone through 5 rounds of Google Translate before being printed in 2-pt type. While carrying the monitor to your former man cave in the basement you fall down the stairs. The monitor, encased in styrofoam, is fine. You, on the other hand, have broken elbow and a broken ankle. Both of your top incisors were knocked out on the last step, but not before piercing your upper lip. Are you eligible for worker’s compensation, with your employer paying for your two new dental implants (~$4000 each) and reconstructive plastic surgery since you were “at work” when the fall happened?

  25. ArvidMartensen

    Working from home, if widely adopted, would be the next ghetto. For women.

    Women start behind the line already in terms of career paths. Any hint of a bulge and they are usually mentally put onto the mommy track, just like older males with health problems are pastured out.

    It is only through being present at the office, speaking up at meetings, working harder than their male colleagues and making the boss look good, that they get considered for promotion.
    At home they would be invisible. It would also be vaguely assumed by the bosses that they couldn’t be productive even if it weren’t true.

  26. RockHard

    Friend who works at Netflix told me that Reed Hastings got overruled by one of his key lieutenants.

    Also, given the recent hiring trends, any CEO that tries to force in-office polices in the tech sector is going to end up with a gigantic attrition problem.

    1. Yves Smith Post author

      I don’t see anything in the press confirming your gossip. A search says Hastings’ prior statement is still Netflix’s official position.

      And in any event, I didn’t say all of work from home would be reversed. I said more will be reversed than the people who are buying bigger and more remote homes think.

  27. Mikel

    If people can’t imagine a life different from morning and evening drive commutes and a life not centered around an employer for 24/7 and all the Taylorism and human behavior sheep herding, the bigger changes that require even more imagination about how differently lives can be fulfilling led aren’t going to be possible.

  28. Copeland

    How do these CEO’s opinions on WFH square up with their bottom lines during COVID? Netflix really pops out obviously, but I thought many of the obscenely huge corporations were doing very well during the pandemic?

  29. redleg

    David Graeber left this world too soon. I would love to read his response to this within the framework of his “Bullshit Jobs” theory.

    I think that BS jobs like Box Checkers & Duct Tapers would be just fine WFH. The premise of BS Jobs is that they exist to justify management, so of course the Flunkies, Goons, & Taskmasters would have to be in the office- not just because the boss wants to manage their staff, but so that the boss can be seen managing the staff.

    I’m not anywhere near as brilliant as Graeber, but I make up for it with cynicism. One anecdote isn’t data, but I’ve never been happier, healthier, busier, and more productive as a worker since the office(s) closed due to the pandemic. I’ll never go back to an office if offered any alternative whatsoever.

    1. Basil Pesto

      I was actually thinking the exact same thing as you while reading the piece. Thanks for tackling the question!

  30. ChrisAtRU

    #Counterpoint … ;-)

    I’ll begin where the article ends:

    “In other words, to the extent that particular companies preserve significant work at home populations, it will because they’ve figured out how to use it to lower costs. That means not just office space but over time paying employees in lower cost locations less. Big companies know just as well as Rahm Emanuel never to let a crisis go to waste.”

    One thing missing IMO: getting more productivity out of home workers.

    Next, let me ask this: Thinking like a CEO in early-21st-century late-stage-capitalism land, if you actually believed (based on data or informal observation) that your company’s workers were being more productive at home, would you want to let them know (directly or via a WSJ article) and have them reap the full benefit of knowing so?

    Hell-To-The-No. Follow along …

    Now, the spectrum of work from home types is vast, true … and I don’t claim to know people across all silos and verticals … but within my particular neck of the woods, everyone is working more.

    How come, you ask?

    Let’s run through a short, non-exhaustive list:
    – You used to commute to work in the morning. Guess what? Now you have a meeting.
    – You used to commute from work in the evening. Guess what? Now you have a meeting.
    – That lunch break to “work out” and its accompanying “Do Not Schedule” in your calendar? Everyone is scheduling over it now.
    – That travel day? Gone. You have several meetings instead.
    – That “Avengers Assemble” onsite you and five team members used to do with the customer, that tied up the half dozen of you all day? Guess what? Maybe four of you now pop in for an hour to cover your stuff, before and after which you are available to work on other things.

    The dirty little secret is that contrary to what’s being articulated by some, many people are actually over-working at home [1]. Yes, the home-schoolers will struggle during the day a bit, but guess what? They’re logged on at 11 PM catching up on emails anyway. The dirtier secret is that the CEO’s being interviewed by business and finance magazines probably know it too, but few will ever admit it. Why? Because to admit that working from home benefits a company will put pressure on companies to fund home worker infrastructure which will eat into any potential savings from giving up expensive real estate and/or leases. So, the cunning feat to be accomplished is to make “working from home” remain more like a favor being granted to those who want to work from home, exactly so that such workers will make concessions like accepting salary cuts and/or relocation. The benefit of the pandemic is that it will burn in all the (CEO desired) behaviors – like taking earlier/later meetings, and detaching less outside pre-pandemic work hours. It will be the ultimate win-win.

    And finally, A #CounterCounterpoint … :)

    If working from home doesn’t become a thing, it may very well be to a fair degree because workers (not only CEO’s) reject it as well, since the pandemic will show workers just how much less they were able to actually work when they had to spend hours commuting daily, travelling for business or having what my dear Russian friends call “Бизнес ланч” … ;-)

    [1] – “VPN and desktop use and employee hours spike due to the coronavirus” (via TechRepublic)

  31. ChrisFromGeorgia

    Having re-read the comments in this excellent thread, I realized that there is an elephant in the room that has not been brought up:

    Climate change.

    It makes zero sense from an energy perspective to have workers burning fossil fuels to drive in (or take a train, albeit less of an inefficiency) to large office buildings that require heating, cooling and electricity.

    When many can do the exact same job from home.

    This seems like low hanging fruit if we’re serious about making a difference. As opposed to convincing folks to stop taking cruises or going on unnecessary airline flights.

    And yet the cynic in me says, it is not part of the discussion because Wall St. doesn’t want it to be. Easier to blow billions on a “LEET certified” tower and get the virtue-signalling points.

  32. Marilyn

    “While it’s not hard to see that women with kids would get stuck with minding them while also trying do to their day jobs,”

    I find that line sad. What’s more imporant, their job, or their children?
    What are they supposed to do? Rely on the nanny to raise their children? Expect their husband to do 50%, which implies that men have the same parenting, maternal and other skills with small children that a mother does?

    There are millions of nearly abandoned children in this country, even though parents have money. Time is the most precious thing that a child can get from either parent.

  33. Erelis

    Pretty much everybody at my software company is working at home. Releases are happening on time and revenues keep growing. Management does want to reopen the offices as soon as possible, or least get a good percentage of workers back into the offices.

    It hit me that my particular division is doing well because we over time we were trained how to work remotely. At a previous company I would go to work everyday and realized once I had not stepped into a conference room for over two years because nearly all the people I worked with were in offices spread over different states and nations. I had plenty of meetings but took them with a headset in my cubicle. I think what happened over time is that many companies naturally developed solid IT infrastructures to handle dispersed work, servers, tools, etc. So making a transition from the office to home not that difficult for many as a result. Now I am speaking from the R&D side; sales and support a different story.

    As for upper management not liking employees working at home. That is because people may realize they are not necessary to the success of the company. I worked at one good sized software company that had spasms over the founders and the new managers the BOD wanted to bring in. For a long time, no body at the top, and the work got done by a workforce that like knew how to get the work done. And even made strategic decisions.

    I suspect that at least in high tech some companies are having issues because their workforces are highly
    concentrated in just a few areas and rarely had to work with remote groups. Google alone has about 45,000 employees in the Bay area. Suddenly working at home is a cultural shock and an IT infrastructure not built around that.

  34. TomR

    CEOs and managers currently need private meetings to plan and execute various scams. They need a level of secrecy. Third party online meeting services like Zoom are inappropriate for such type of jobs – you don’t want third party (a tech company) to be able to overhear what’s going on.

    Perhaps they just need some custom-build communications channels, point-to-point ones, or more like a military communications for higher level of secrecy? They have money to pay for development of such safer communication tools. If such tools arrive – they won’t need to meet in private to conspire.

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