Return to the Office – A New Balance
The Unispace Global Insights 2023 report has some interesting findings.
The Unispace study engaged 9,5000 employees, and 6,500 employers, across 17 countries worldwide.
It follows the survey conducted in 2021 called “The Reluctant Returner” which found there was a clear hesitation to return to the workplace, A lot has changed since then.
In 2023, employees are less reluctant to return to the office than they were in 2021. 51% of workers globally are reluctant compared to 64% in 2021.
This still equates to more than half of the global workforce not wanting to return to the office.
I want to unpack some of the key findings.
The mandate
Mandated office returns are having a negative impact on talent attraction and retention.
Almost half (42%) of firms who mandated returns have experienced higher than normal employee attrition, whole 29% are struggling to recruit
72% of employers surveyed stated that they are taking this approach. An additional 20% have not mandated a return but are highly recommending it.
I don’t know whether it is the 72% or the 20% that is most worrying. At least with the 72% you know where you stand. The 20% are those highly recommending you return to the office and inferring that you will be performance managed if you don’t. It is the covert tracking of ID badges to determine who is in the office and how often. There is no transparency about how that data is being used.
Clearly, the mandated approach is not working in the employers' favour.
Employees need a reason to commute into the office. There is just no sound reasoning for employees to be mandated to be in the office x days a week or on certain days of the week. Their attendance in the office should reflect the work or activities they are undertaking. It must be the individual and the team that decide when it makes sense to co-locate in the office.
In May 2022, I penned the article, “There Are Only 5 Reasons to Return to The Office”.
In that article, I suggested that the litmus test for attending the office is to ask, “Was it worth it?” If it was, mark that as a good enough reason to make the commute.
The decision to attend the office is made by the individual and the team, not the senior leadership. This is a delegated decision, not one that is dictated.
The Unispace report cites Marco Brucato, eCommerce Lead at The Kraft Heinz Company. He has some wise words:
“As a business, we do recognize that people need to be together in the office and we encourage staff to have two days of smart working together each month. When and how often our people come into the office is driven by a range of elements, from their own agenda on any given day, their home working conditions, who else is in and much more. But what we’ve found is that giving staff that flexibility to choose is what is driving returns more naturally.”
Smart working is when it makes sense. Smart working is not commuting for 2 hours to do exactly what you could have done from home.
The ideal hybrid working approach is constantly evolving, but the significant disconnect between employer perceptions and employee needs and values remains, threatening to drive a further wedge.
Employer and employee gap
There is also concerning data regarding employer bias towards employees working in the office. Proximity bias is alive and kicking!
84% of employers indicated that the chance to progress in their role will be limited for those employees who are not in the office.
In comparison, just 67% of employees believed this to be true, signalling a clear disconnect between businesses and workers that will likely continue to have an adverse impact on retention figures.
There is a clear gap between employer perceptions and employee needs. The data reveals that what employers think is influencing office returns and the reluctance to be in the office, is wrong.
When asked what they believe their people dislike about the office, the commute ranked highly, with 21% indicating that they believed staff wanted to gain back time spent travelling while 20% suggested employees simply do not want to commute.
31% of employees globally cited their number one office dislike as a lack of privacy they could otherwise access at home. Being more effective in a quiet environment remotely, ranked second (27%), while feeling more productive at home came third (23%).
Employers also think that employees' ability to do admin tasks at home and enjoy the privacy of remote working is driving the reluctance. Employees, on the other hand, indicated that 40% of their time in the office is spent on administrative tasks.
Until employers ask questions and listen to employees, this gap is going to continue to increase until it cannot be reconciled. Employees will leave to find employers who are prepared to listen. I recognise that there are employees that are tied to an employer with golden handcuffs.
These are the financial incentives given to employees to discourage them from leaving. Whilst these may retain staff in the short term, the retained staff will quickly become unmotivated and disengaged, stressed and anxious, as they must take on the workload of those employees who have jumped ship. Remember, the mandated return is having an adverse impact on recruitment, so attrition cannot be replaced. Eventually, the golden handcuffs become tarnished, and the once-handcuffed employee will find a way to slowly slip them off. They realise that their mental and physical well-being is worth more than their financial benefits.
Hot-desking
Hot-desking is currently the main set-up for just under half (48%) of workers, but many indicated that having an assigned desk would entice them into the workplace more often.
83% of those who hot desk indicated that they would be more inclined to come into the office if they had an assigned desk, suggesting that having a guaranteed individual work area is motivating office returns.
These are the figures extracted from the report by country. The global average of workers hot-desking is 48%.
This tells me that employees want the same experience they have working from home as they do when they are in the office - a personal space. Employees relationship with the workplace has evolved since the pandemic and employers must recognise that. The office still has a role but is seen with a different lens.
Marco Brucato said:
“People need a reason to go into the office now and commuting to a workspace that sits away from the city and gives them no incentive to be in the space aside from working doesn’t have the appealing factor that it perhaps used to.”
Kristopher Kelly, Executive Director, Head of Corporate Services at Moelis, echoed my thoughts about mirroring the working-from-home experience.
“While we have created more collaboration areas, we have retained the assigned desks for employees which supports individual-focused work. Where collaboration spaces are available, they are dynamic, and tech enabled. We are also competing with the benefits of working remotely. So, while it was important to create spaces that satisfy the desire to interact with colleagues, it’s also important to ensure spaces provide some of the conveniences found at home.”
Employers must take note and allow for both collaborative and individual desk spaces to ensure they are meeting the day-to-day needs of employees.
Whilst the provision of dedicated personal spaces to replace hot desks will incur a cost the return on investment due to the ability to attract and retain talent is manyfold.
Real estate
I believe this is the most interesting and unexpected finding. There has been a massive U-turn regarding real estate. In 2021, 84% of respondents revealed they planned to decrease the amount of office space they maintained.
It is interesting to note, that despite the rise in hybrid, three-quarters (75%) of businesses have increased their real estate footprint in the last two years whilst just 10% have decreased it.
This is significantly different to the expectations outlined in the 2021 study, where 84% of employers saw the pandemic as an opportunity to decrease their real estate portfolio by an average of 25% of their total footprint.
Looking ahead, the majority (74%) plan to increase their footprint in the next two years.
These are the figures extracted from the report by country. The global average of employers expanding their footprint over the last 2 years is 75%
The following sectors ranked the highest when revealing intentions to expand their workplaces in the next two years.
Analysis of the reasons behind office footprint increases, the need to adapt to the changing world of work and make offices more flexible is a top driver of this action (cited by 44% of those planning to increase their workspace).
Creating hospitality spaces to host more client and candidate events was also cited as a top reason to increase space by 44% of those surveyed.
41% said they needed more space for meeting and collaboration rooms as well as desk spaces.
Some of the other reasons for the increase in footprint include:
· Company growth – 41% of employers indicated that their company had grown and required bigger spaces as a result.
· De-densification.
· Creating office spaces nearer homes to reduce employee commute time.
· Sustainability.
· Increase of personal desk space with the reduction in hot-desking.
· Creating office space nearer to clients.
· Access to natural light.
Conclusion
Employers must cease a mandate for a return to the office and provide a working space that encourages employees to co-locate when there is a purpose.
Employers must close the gap between their perception and employee sentiment. The misalignment is already affecting staff attrition and recruitment and failure to address it will see organisations go out of business.
The employee relationship with the office has changed and there is no going back. Employers must ask questions and really listen to their employees and create a space that delivers against their needs.