Data reflecting changes in the workforce indicates how profound and long-lasting changes have become – specifically, the remote workforce. San Francisco Mayor London Breed’s office estimates that one-third of San Francisco’s workforce is now remote and outside of the city. Last year, that resulted in a whopping $400 million hit to tax revenue, according to the Office of the Controller, reports CNBC.
“The office vacancy rate in San Francisco rose to 24.2% in the second quarter from 23.8% in the prior period, according to CBRE research. Other major cities are at historically high levels, but still below San Francisco,” states CNBC.
“Manhattan reached an all-time high in the quarter of 15.2%. Downtown Atlanta is at 22.8%, Chicago hit 21.2%, Los Angeles touched 21.8% and Seattle is at 20.3%, CBRE said.
Salesforce, San Francisco’s largest employer, said last week it was cutting its office space in the city yet again, and is now listing 40% of a 43-story building that’s across the street from the main Salesforce Tower. Coinbase closed its San Francisco office last year, and Lyft pushed its return to office until 2023 at the earliest. Most companies that have reopened did so with optional attendance.
Even at Google, one of the more vocal companies in tech when it comes to getting staffers back to the office, has retreated. Workers pushed back on demands, citing the record profit the company generated last year. Leadership said it’s approved 85% of requests for relocation or permanent remote work.
Tech companies with long leases are feeling the pain, as San Francisco commercial real estate properties have, on average, fallen to between 30% and 40% below pre-pandemic prices, market experts said.
Axios reports that according to an CBRE analysis:
-In northern Virginia, Fannie Mae and Volkswagen consolidated office space and moved, which drove up the vacancy rate.
– In suburban Maryland, the completion of the new Avocet Tower in Bethesda, which added 331,000 square feet of vacant office space, led to an increase in the vacancy rate. While suburban Maryland has the lowest rate of the D.C. region overall, Q2’s 17.7% vacancy rate represents a record high for the area.
The question is where are we on the trend toward a permanent remote workforce … and what does it mean, fundamentally, to a workforce in transition.