“The Stalled Return to the Office: Impacts on Urban Service Activities and Local Budgets”

“You can’t stay in your pajamas all day! » During the winter of 2022, the new (Democratic) mayor of New York, Eric Adams, invited residents to return to office. “New Yorkers, it’s time to get back to work. You can’t tell me on Monday that you’re afraid of Covid-19, while I see you on Sunday in a nightclub. » At the time, many thought that pressure from employers and rising unemployment due to inflation would bring about a return to normal. It missed. “The return to the office has stalled”titled the Wall Street Journal, the 16th from

The share of American companies that require their employees to work full-time in the office has fallen in three months from 49% to 42%. According to the Working from Home think tank, the percentage of employees working remotely at least six hours a week has certainly fallen from 61.5%, at the height of the pandemic, to 28.4% in April, but this figure does not has nothing to do with the situation that prevailed until 2020, when working from home concerned only 4.6% of them.

Imperceptibly, they take the path of the four-day week, with premises deserted on Fridays. Thus, in New York, in January, the office occupancy rate was over 60% on Tuesday, but barely exceeded 25% on Friday.

Tax aid

This situation represents a disaster for urban service activities. According to Working from Home, for any employee who works from home instead of going to Manhattan, 4,600 dollars (about 4,250 euros) in turnover is not realized. “The accountant who is not in his office does not go to the dry cleaners or to the restaurant. This does not allow cooks, waiters, dishwashers [de gagner leur vie] »Mr. Adams charged.

The mayor has set up tax aid for the renovation of offices built before the year 2000. “Any empty office means less funding for everything from schools to low-income housing. » By definition, remote work is for “computer workers” in tech, banking and consulting, and very few for lower-wage workers in hospitality, entertainment and retail. . It is also a tragedy for the town hall: a third of its budget is funded by property tax (31 billion dollars per year), 40% of which comes from commercial or office real estate.

Office occupancy rates in the 10 largest US cities have remained near 50% for weeks, according to Kastle Systems, a security firm that monitors access card reads. Companies have alternated the stick and the carrot to attract their employees. According to Wall Street Journal, the law firm Davis Polk & Wardwell LLP threatened to reduce the bonus of employees who were not present three days a week. In April, the investment bank JP Morgan required a presence of five days a week. As for Meta, the firm of Mark Zuckerberg, it has indicated that it no longer wants to recruit people completely from a distance, leaving that it would end up demanding a return to the office.

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