Major corporations are eager to mandate that employees return to the office but are awaiting uncertain outcomes.
Key details
Labor Day marked a point of demarcation for corporations that are mandating the return of employees back to the office from remote work.
Apple, BlackRock, Prudential Financial, BMO Financial Group, and other large corporations are pushing for returns to the office this month while others are more aggressively pressuring employees to choose to come in or face negative consequences.
“After months of encouraging white-collar employees to return, or attempting to coax them back with free pizza, warm cookies, and catered lunches, many executives now say they feel emboldened to take a tougher stance,” says The Wall Street Journal.
Why it’s important
Remote work expanded between 2008 to 2018 by 400% and further expanded during the COVID-19 pandemic as major corporations were forced to adjust to safety precautions. Remote work is expected to expand, and 50 to 80 million desk jobs will be majority remote.
The effectiveness of these new mandates may make or break advocates of both remote work and office work.
Both sides are in a vulnerable position, as greater job mobility and availability have given workers the competitive edge to leave a job for one that offers more suitable benefits. The sensitive economic situation, with the threat of recession, stagflation, and mass layoffs, may scare employees back into the arms of their current employers though.
“A lot of CEOs are itching to get workers back to the office, but tech CEOs who want that face an extra uphill battle: After all, theirs is the industry that made remote work possible,” says Axios.
It remains to be seen if workers will walk or respond positively to the mandates. An April study suggests as many as 56% of employees desire to leave if the mandates are enforced, according to Fortune.
BlackRock CEO Larry Fink argued in a Tuesday interview with Fox Business that returning employees to the office could even help reduce inflation by improving labor productivity and that his company will be enforcing stricter mandates.
“We have to get our employees back in the office… rising productivity will offset some of the inflationary pressures… [BlackRock will] be taking a harder line as to how we bring our employees back. [Returning people to the office] is going to be a key element in bringing down inflation: rising productivity,” says Fink.
Backing up a bit
As we previously reported, Apple set a mandate last month that all employees must return to the office at least three days per week, which was met with resistance from over 1,000 employees who signed a petition to appeal it. Apple has not budged on its demand. Other companies like AT&T have faced similar employee backlash and petitions for attempting to draw back remote workers.
Having a high percentage of remote workers is having a negative impact on company cultures. It is leaving office buildings half-filled and making it harder for firms to operate and communicate internally and externally, which is beginning to affect profitability. It has also had a negative effect on mentorship and corporate cohesion.
“If you can go to a restaurant in New York City, you can come into the office, and we want you in the office. By Labor Day, I’ll be very disappointed if people haven’t found their way into the office and then we’ll have a different kind of conversation,” said Morgan Stanley CEO James Gorman said in July.
As many as 75% of survey respondents say they prefer remote work and 61% of workers given the option choose it. Remote work may become a permanent feature of the economy and companies cracking down on it may find their employees are a flight risk.
“Inevitably, managers who favor in-office work rely less on statistics and more on invocation of culture and creativity. That’s often heartfelt—but it can also feed workers’ suspicion that bosses are driven by nostalgia or a hunger for control,” says Axios.
Notable quote
“Audio giant Spotify Technology SA said its roughly 8,600 employees, who have been largely remote during the pandemic, returned in recent months in larger numbers than the company expected. That is partly because it hasn’t forced them to do so… After Spotify offered most employees a choice on their work setup, about 60% chose to work from an office a majority of the time, while roughly 40% decided to remain largely at home,” says The Wall Street Journal.
