Wesley's Rant: How We Work Going Forward
Friday, December 17, 2021
If you have a “desk job,” COVID-19 has changed how we work. However, it is very likely we will never go back to how work was done prior to COVID-19.
The implications from now on are significant for many aspects of our economy. The nation has become more productive, and many employees report that their lives are more balanced. A satisfying and rewarding work-life balance helps us live happier and more rewarding lives.
While we are currently in the midst of this live experiment; only time will tell if it ends up being a positive or a negative in the long term.
For example, I recently did a year-end review with a client. He works for a large company and has been working remotely from home since March 2020. In our meeting, he mentioned that he and two co-workers would rent a house in Florida for the next two months. They all work remotely, and the plan was to take their respective spouses, golf clubs, etc., down to Florida for the next two months and enjoy some sunshine since they have been told they will continue to work remotely until at least the end of March 2022. It had been 19 months since the initial shutdown from COVID-19 in March 2020, and only a fraction of white-collar employees had returned to the office in many major cities.
I recently saw an article that had some data from Kastle Systems International. This company is a significant provider of card swipe systems for office access. The company collects data from 2600 different companies across 130 cities in the United States. The data shows that card swipes are down 52% in New York City and 57% in San Francisco.
The data is very similar in other large cities, and the data also shows that people are only in the office on average two days a week. So, I think it is fair to say that a significant portion of the white-collar workforce has settled into some hybrid work routine. Think of all that vacant office space in cities like New York or San Francisco?
Think of the major corporations that have built large corporate headquarters that sit primarily vacant?
In my office, employees can work remotely one day per week, and going forward; our policy may be to increase that to two days per week. The long-term implications are yet to be seen, but it is possible for our very large cities to experience a decline in their commercial space and residential real estate value. As a result, the tax base for these large cities may decline for sales, real estate, and income taxes. Cities that experience permanent population declines will also experience decreases in quality-of-life issues. As the quality of life in our major cities continues to decline and more people leave the densely populated urban areas, the amount of financial support these cities ask for from the Federal government will undoubtedly increase.
On the opposite side, the other part of the workforce did not have the luxury to work from home or remotely from some vacation spot. These workers have had to still go work in the factories near other co-workers, wearing masks, dealing with COVID exposure, etc. Has the quality of life for our non-white-collar workforce improved?
Have their lives become better, and do they now feel the quality of a work-life balance? Again, I would argue the answer is no, and again, the long-term implications of this trend will begin to show themselves in the not-too-distant future.
Many may quit these jobs, or perhaps many of these jobs will be eliminated because of a dramatic increase in automation. You may want to think about what the future looks like when working as we move forward! The possible implications are fascinating to think about.
Managing Partner, Financial Advisor, CFP®, J.D.
Footnotes and Disclosures
Securities are offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services are offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Wiser Financial Group is not affiliated with Kestra IS or Kestra AS. Investor Disclosures https://bit.ly/KF-Disclosures
The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC, or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor about your individual situation. Comments concerning the past performance are not intended to be forward-looking and should not be viewed as an indication of future results.