Spend any time in New York, and you will feel it. Manhattan and Brooklyn teem with activity. It’s exciting to be there after being relatively locked up for years.
The question, and one early this week by the San Francisco Chronicle, is why San Francisco isn’t rebounding in the same way.
As reporter Roland Li writes, “There has always been an inequality — New York has 10 times the population of San Francisco — but coastal tourism and economic hubs have disintegrated in striking ways as they recover from the pandemic.”
Recall, writes Li, that while construction of major commercial real estate projects in Manhattan was completed during the pandemic — and while much of that new office space is almost fully leased — in San Francisco, projects have stalled and existing buildings struggled to accommodate tenants. because of the work from home policy.
One possible way to fill those buildings is to convert them into homes. Wall Street, Li notes, has been doing just that for decades. But while there is clear demand for housing in New York, with rents rising to record prices even now, it’s not so clear in San Francisco that enough people would rent remodeled office space right now, even if it were made available.
The new telecommuting policies are clearly having a major impact on where people live, and many Bay Area workers who could be escaping the region’s high prices have too. (California — led by San Francisco and followed by Los Angeles — lost more than 352,000 inhabitants between April 2020 and January 2022, according to statistics from the California Department of Finance.)
It may be time to consider whether these fully distributed plans continue to make sense. In his piece, Li partially draws a line between the “shocking bustle” on the streets of New York until April last year, when then-Mayor Bill de Blasio announced that city workers would soon be returning to office, a move soon followed. by private companies.
Called back by employers, New Yorkers who had left during the pandemic suddenly found themselves looking for housing again, even just to spend two or three days in the office.
The gamble continues to work, apparently. The Partnership for New York City, what it says more than 160 employers surveyed between a two-week period in late April and early May, it was found that 38% of their Manhattan employees are now back in the office on the average weekday, while 28% are completely remote. Meanwhile, the average turnout is expected to rise to 49% next month.
That doesn’t mean employees are back full-time. That may never be the case, as even the loudest critics of remote work have been forced to soften their stance, including Jamie Dimon, CEO of JPMorgan Chase. as Bloomberg reported in May, Dimon told shareholders in an April letter that working from home “will become more permanent in corporate America” and estimated that about 40% of its 270,000 workforce would work under a hybrid model. Shortly afterwards, based on internal feedback, a senior tech executive from the bank told some teams that they could stay in the office for two, not three, days if they wished.
Those two to three days a week could save New York, and maybe it’s time more employers in San Francisco who don’t like making demands on their own employees consider doing the same.
Small businesses in San Francisco include: increasingly desperate for the economic activity that office workers would bring back; if civic duty is not held in high esteem by local tech companies, there remains a strong case that hybrid environments allow employees to enjoy better work-life balance, more camaraderie with their colleagues and also to get ahead in their career.
Many blame San Francisco for the lack of affordable housing, and there is no doubt that the city is sabotaging itself in this area. In San Francisco, “instead of clear rules, where a developer knows I can build this here, everything is a negotiation and every project is on an ad hoc basis,” Jenny Schuetz, a housing economist at the Brookings Institution, told The Atlantic in May.
But abandoning return-to-office plans forever won’t solve the problem. Meanwhile, two and a half years after the pandemic sent everyone home, and amid a slowing U.S. economy that makes it harder to change jobs (and just relax CDC COVID guidelines), it may be time for more outfits to ask employees to come to the office two to three times a week and see what happens from there.
It is not the responsibility of employers to “fix” San Francisco. At the same time, there may not be much to go back to if they wait too long.