What happens now?

[--Tom--]

Yeah with current rules as a business you need to be careful about setting up a branch in another territory, and as a worker having the right to work. But I can see that changing, businesses already offshore a number of elements - IT development in Eastern Europe and India, call centres etc. All it will take is some motivated employment lawyers and tax accountants and there’ll be a way.

iceland has introduced long term visas for remote workers already as a start to incentivising people to have prolonged stays there in direct response to current changes
https://work.iceland.is/working/icelands-remote-work-long-term-visa

 

[Trainee neophyte]

All that inner city office space is long term pension fund investment. While some could be repurposed to residential space, it would cost a fortune to do, and why on earth would people want to live in the middle of a city? There's no work there any more. It sounds like an opportunity to make ghettos for the no-longer-working-poor.

I'm interested in how the financial implications of all this turn out. If the need for office space is reduced by, say 75%, what does this do to the commercial property market, the banks and the investment funds who own it all?

 

[clogs]

wasn't we told we need HS2 for office people to meet up......what rubbish.....another waste of money....
I always said that there was Skype etc....pure madness......

as for city center living...look at Manchester, I say look cos u cant afford to buy there....Yuppies.....huh.....

 

[Phil Pascoe]

I remember one insidence many years ago. We had one team member who was not ar strong as the rest. As a consequence he tended to work longer hours but still didn't match the output of the stringest team members. One year we came to review time and the MD insisted that our weak link was the best person in the company. ...

My boss used to employ idiots at £250 a week who took two (or even three) weeks to do what a good workman would have done in a week for £400 - because they were cheaper to employ.

My daughter (25) is working from home permanently and loves it. My wife works from the office and as she gets on well with the two people she works with and not particularly well with the three that are working from home, she loves it. Their office has to be manned by more than one (it's a small Swedish bank), and as the three in the office and the three at home find the arrangement suits them it's pretty much ideal. They were looking for another office before this, but now of course it'll be smaller. As their average customers are worth many times more than I earned in my working life it'll be interesting to see how many of them get hit hard. Not, of course, that my wife would tell me.

 

[Rorschach]

City centre living is expensive at the moment, is that because people want to live there though or because the work and facilities are nearby? If the work and businesses in city centres close/move, will living in the city centre be so attractive?

 

[Cirks]

Having worked in IT for 25+ years I’ve done tons of WFH as well as my different employers’ buildings, client sites (home and abroad), temp offices etc. Although an industry where it’s been pretty easy to work remotely for many years, it really does still depend on the individual doing the work and the task being done as to where the best place is to do the work.
Writing code or focussing on documentation remotely is easy but having conversations to really find out what people think, what requirements are and coming to decisions is still, I feel, far easier face-to-face and often when the people are most relaxed - eg standing in a coffee area etc. People are getting more used to zoom type calls but it’s still not the same as real interactions.
Of course, there have been daft arrangements - for example clients insisting I’ve been on site somewhere in the Uk despite the fact that 90%+ of the time I would have been working with guys in India!
It all comes down to the individual - I prefer not working from home as there are too many distractions (I still would get work done but not always at the most sensible times of the day) but sometimes it’s the best place too. I hate busy commutes (so wfh helps there) but at same time actually don’t mind decent journeys to site.
As others have said, I’d hope local offices will start to be used more to give people ability to actually get away from the home environment and mix with other people. With 2 or 3 adults working from one house (eg grown up kids) there will be a real need for people to get away from the family at least for some of their working time.

 

[Keith 66]

My wife works for a local authority in Environmental health, They moved their offices largely to hot desking about two years ago, everyone hated it & productivity fell. Of course to make a covid safe environment hot desking goes out the window very quickly!
She now works flexibly from home & loves it, gets far more done & can arrange inspections at her convenience. The downside is the IT department & if IT breaks down you are stuffed!
A friend works for a big company in Canary wharf, he told me last year that every chair in the office costs the company about 23K per year. The days of "the office" are done unless its a vanity thing. Where this leaves all the service & hospitality venues is most likely down the tubes.
I suspect the concept of buisness rates may have to be drastically changed even abolished, rates are so high that for many buisnesses its the straw that breaks the camels back. The goverment can only give relief for so long as it is so why not just do away with it? Rents also have to fall otherwise you will see city & town centres across the country even emptier than they are already.
Lot of people & companies are going skint.

 

[Terrytpot]

3. Coffee shops may partner with sandwich van franchises (we may expect such a thing) or give rise to even scarier concept of "Uber coffee!" Based on a subscription service!

I think we’re pretty much there already. Whilst delivering to a company early this year, instead of the sandwich van appearance part way through the delivery they had a Costa coffee equipped van (the full expresso machine operated by a barista type of dude) to prepare and dispense the drinks that the local office workers all queued up to get their paws on..

 

[CornishWoodworker]

Welcome to the new World.
There will be winners , there will be losers.
Personally, any company or shop which I know have increased their prices significantly due to Covid, will lose my custom.
I expect many high street shops both large and small to close, as the overheads prove to much to provide an income.
Fir example
A local builder had given me a quotation last March( not agreed or signed as lockdown had just appeared) for an new timber garage/ workshop. After lockdown he said he was putting up his quote by 23% , to cover his losses during lockdown.
He was really not a hawhen person when I declined his revised quote.
So it looks like building it myself this March, saving about £2400. Will take a few weeks longer to complete.

 

[CornishWoodworker]

My wife works for a local authority in Environmental health, They moved their offices largely to hot desking about two years ago, everyone hated it & productivity fell. Of course to make a covid safe environment hot desking goes out the window very quickly!
She now works flexibly from home & loves it, gets far more done & can arrange inspections at her convenience. The downside is the IT department & if IT breaks down you are stuffed!
A friend works for a big company in Canary wharf, he told me last year that every chair in the office costs the company about 23K per year. The days of "the office" are done unless its a vanity thing. Where this leaves all the service & hospitality venues is most likely down the tubes.
I suspect the concept of buisness rates may have to be drastically changed even abolished, rates are so high that for many buisnesses its the straw that breaks the camels back. The goverment can only give relief for so long as it is so why not just do away with it? Rents also have to fall otherwise you will see city & town centres across the country even emptier than they are already.
Lot of people & companies are going skint.

Watch out for a Work at Home supplement on your Council Tax, hopefully your employer will pay this.
The Government and Councils will still need revenue!

 

[Droogs]

If we are all doing more WFH, who is expected to pay the cost?
I am currently working from home (which suits me as I have now been banned from going out again by aunty Nichola) as opposed to losing the job, doing a market research/QC phone based job. I use my own laptop and audio kit to remotely log in on my broadband and work that way. Now I used to do this job at the company's offices using their kit, electricity, phone line etc. The job is minimum wage but since WFH started my electricity use has nearly doubled during the day as I am now here in the house and not there in the office. How do I get that cost back. The company wont pay my internet or electricity bill, so they save and I am working for even less money than I used to 'cos I now have to pay for the privilege of having a job and to be able to do it.

 

[Terrytpot]

If we are all doing more WFH, who is expected to pay the cost?
I am currently working from home (which suits me as I have now been banned from going out again by aunty Nichola) as opposed to losing the job, doing a market research/QC phone based job.

My wife also used to do market research (for Mori) up until March this year at which point she got furloughed and ended up earning pretty much the same (no travel expenses) as if she had carried on working (which you couldn’t do when the job entailed doorstep interviews). For some folks the wfh scenario has been a huge boon (eg: company I used to work for relocated and one of the admin guys nearly lost his job as he struggled to get to the new place and had to scrounge a lift everyday..come COVID-19, he was granted wfh and is no doubt dreading the return to normal status) but there will always be people who get dumped on by an enforced change to their previous mode of operation. Unfortunately for you , you appear to fall into the latter category and have my sympathy unlike my Mrs who was chuffed to bits at not having to work outside in the pants weather we get at this time of year.

 

[Droogs]

My wife also used to do market research (for Mori) up until March this year at which point she got furloughed and ended up earning pretty much the same (no travel expenses) as if she had carried on working (which you couldn’t do when the job entailed doorstep interviews). For some folks the wfh scenario has been a huge boon (eg: company I used to work for relocated and one of the admin guys nearly lost his job as he struggled to get to the new place and had to scrounge a lift everyday..come COVID-19, he was granted wfh and is no doubt dreading the return to normal status) but there will always be people who get dumped on by an enforced change to their previous mode of operation. Unfortunately for you , you appear to fall into the latter category and have my sympathy unlike my Mrs who was chuffed to bits at not having to work outside in the pants weather we get at this time of year.

I also used to do field research as well, lots of door to door stuff and in the high st just depends on the project. A couple of the doorstep interviews were converted to tele-interviews. Nice not to be in the rain etc but cost wise not liking it

 

[--Tom--]

Agree droogs, I’d also add in the square footage of my house that I pay for and is solely used by my employer.
Have you seen you can claim a tax rebate from Hmrc to offset some of the cost?(worth doing)
Ultimately the money saved on offices should go the workers now shouldering the cost.

 

[HappyHacker]

I the 90's I took part in a working from home trial for a company in London where I was working as a weekly commuter from up North. Initially one day a week at home with the company paying for ISDN lines so I could use the computer network and the phone was redirected, mobiles were not very common at the time.

No video conferencing and I found it very isolating. I was missing out on the banter/chat/ideas in the office where I worked as part of a small team. The ideas, opportunities and networking that were generated from casual conversations in the office, the lift, stairs, cafe etc were missing. I got more work done on one day a week but when that increased it became very difficult without the face to face interaction that I found essential to many aspect of the job.

I am sure companies will work on ways around this but having experience in other companies where individuals were working remotely in different countries or cities it was very difficult to get them fully engaged with the people working in the office.

Having retired I now work from home 7 days a week

 

[rafezetter]

The working from home thing, although new to many, has been going in the I.T sector for a long time.

However, as you say, the effect of this will be felt by the people whose livelihood depended on people going to office. But, only a portion (can't comment on how big or small) are working from home. There are still large pockets of jobs in manufacturing, construction and other industries where at least a majority of the work force still have to go into work until such a time where all those jobs are either replaced by machines or by lack of demand (latter being highly unlikely for the next decade or two)

Also, throughout history, especially recent (last 50 years), this has been fairly dynamic and the people and their jobs have evolved. And the rate of that evolution is has also accelerated in the last 20-30 years where the concept of "start a job and retire at it in return for a watch" has changed to "keep your fingers in as many pies".

So I think, after an adjustment period, they will all evolve.
1. Transport sector will probably focus more on logistical support rather than people transport (online shopping deliveries, food and supermarket deliveries)
2. Sandwich vans may branch out into delivering sandwiches to areas with more homeworking people (who will gladly welcome it as then they wouldn't have to cook!)
3. Coffee shops may partner with sandwich van franchises (we may expect such a thing) or give rise to even scarier concept of "Uber coffee!" Based on a subscription service!
4. Car parks is a tough one to predict, but could be demolished and /or rebuilt as hospitals (because we're going to need it!)

Time will tell.

I think the possibility of a sandwich version of an ice cream van might work - "a patch", a van and a loud annoying jingle to call out the WFH. Garages with a small supermarket will expand, and popup portacabin style sandwich shops also.

High street shops will probably become a place to go see items, because certain things always need to be seen and felt - clothing, shoes etc, with a very limited stock range and the rest shipped directly from a warehouse via the gig delivery sytem, which is going to go through the roof even more than it already has. Large department style stores are going to downsize, and shoppingmalls will have to adapt, becoming more like a "resort" with shopping, gyms etc etc. I know some are already like that but many are not - Cribbs Causeway in Bristol, the main building is just shops with a food court area, so it could be that the John Lewis, there will downsize by half, and that space taken up with something else not already catered to inside the building. Many of the outside units in the area may well become unused, or turned into something else.

Retail laws regarding rents on leases might have to change to allow less profitable businesses to use them rather than owners just keeping them empty to retain the "rateable value" (if my understanding of the system is correct) - Bristol used to have an ice rink for example and it was popular for a long time until the owners ran it into the ground, that would be a welcome comeback - more indoor sports areas as well would be great so things like 5 a side becomes less seasonal.

Huge behemoths like Lightwater.. who knows... and in America where "malls" are like small cities, well they might fare better actually on reflection as they have the space for stock storage, they might be the places to go to actually "buy today".

Or some shops might close to have an online only presence and those spaces be converted to an Argos style collection area for the shops within the mall.

Probably some money in those ideas if I knew how to tap it.

 

[Terry - Somerset]

Different jobs, personal circumstances, companies and personalities mean there is no universal approach to WFH. But it is very clear that the 5 days a week office commute model is (permanently) broken.

Because of individual differences there is no universal solution to the disruption on the horizon - changes may include:

• re-purposing office blocks
• local office hubs
• greater local and community interaction
• tax and/or employer WFH subsidies
• re-inventing high streets, possibly as mixed economies
• failure of the weakest and those incapable of responding
• house price increases for good WFH capabilities
• changed balance in the commute/live compromise
• etc etc

As already seems to be happening is that each impacted group will seek government funding to bail them out of a problem, or will seek to pass the buck on to the next in line.

Given the now parlous state of public finances, Rishi will need to be very tough in allowing only the most worthy of claims on the taxpayer.

 

[rafezetter]

This also brings up the question of how remote can you be from the office. Will we see more people moving to the country as they can now work in remote areas and not worry about commutes. Then what about overseas, could you do your job from the south of France? Or what if it just makes offshoring and saving staffing costs that much easier. Will we have a much more global workforce now people don’t need to be in the office.

it has been odd that precovid so many businesses stuck to office hours that didn’t need to. Why could I only get a haircut between 9-5? Why were shops open 9-5? During those times people are working to get money to be able to spend it.....
Online will takeover as now when I finish work at 6 all the shops are shut and I no longer pop out on lunch to quickly buy things. If I could still go to a physical shop I would for things like clothing that you want to be able to see etc

I have seen a reinvigoration of local shops and the parks. They are now full of people going out to get a coffee or sandwich and walking round the park as an escape from the house.

businesses adapt or die

I do feel quite strongly that savings in property by businesses should go to the staff. A percentage of my house is now office space, and my bills have doubled.

if I was earlier in my career and still living in a studio flat with no outside space I’d be desperate to get back into the office, as I am I was in a position to buy myself a comfortable office chair, a desk and reallocate space in the house. Plus in the summer sit in the garden on calls and enjoy the weather.

I've often wondered about that too - having spent a reasonable amount of time in Spain and the Balaeric islands the ability to shop until 8 / 9 pm because many closed during the day was extremely beneficial - I know they closed midday for a "siesta" and that was the origin of it, but the side effect of being open after many workers in air con building stopped, was surely fora more profitable than closing at the same time workers knocked off. We've been slowly moving towards that in the UK for a while, but many shops maybe only do it once or twice a week.

You can claim tax relief for having home office space and working from home - that money bloke (can't remember his name) has been really pushing that in the last months.... Martin Lewis?

 

[rafezetter]

wasn't we told we need HS2 for office people to meet up......what rubbish.....another waste of money....
I always said that there was Skype etc....pure madness......

as for city center living...look at Manchester, I say look cos u cant afford to buy there....Yuppies.....huh.....

In fairness the main reason was to make areas further north more accessible for commuting - no-one had planned on Covid. City centre living NOW is expensive because of all the retail space taken up - halve that and you've now got a HUGE amount of space available for living spaces and probably LESS demand as "being in the city" is now less desirable for many as they don't need to commute anymore.

If people have any sense they will depart city centre living in thier droves to live cheaper elsewhere and WFH until such time as the city centre evolves to become cheaper to live, which it will surely have to do, to retain those seeking the urban social scene. City centre living prices have been parasitically feeding of the fact that many jobs required a local workforce, and commuting took a disproportionate amount of time for distance travelled. My younger brother worked in the city, but lived just 16 miles away, because of p*** poor rail links it took him 1.5 HOURS to travel that distance by train, TRAIN< not bus supposedly the most effiecnet form of commuting... LOL. So he moved to Clapham Junction where his rent of a single room in a so/so house was almost £1000 a month FOR A ROOM. In Manhatten when his office moved there his rented apartment in the upper east side (above 100st) was ..wait for it.... $6800 a month for an apartment that was SMALLER than my suite in a hotel, that cost $500 a night - which isn't as expensive as it sounds for New York hotel prices.

He's said his company has actually been very happy the forced WFH happened, they have downsized thier main office (that was costing them an absolute fortune) and staff have mostly been a lot happier without the stress of a crappy commute into central NY every day.

I work in Bristol and London, but if there was more money up north, but still cheaper to live (I can rent a HOUSE only a few hundred miles away for the cost of my single room) I would move. I think this siutation may well save some very economically downtrodden cities and towns where traditional "physical prescence work" is scarce - but infrastructure would have to change dramatically - fibreoptic for a start still has very low coverage in some in many areas and in some none at all.

Sounds odd but the more I think on it the more this could well be a blessing to shunt western society out of it's time honored, but otherwise detrimental living habits.

 

[Terry - Somerset]

I live in Somerset. Locals may disagree, but property is relatively cheap.

For between £0.5 - 1.0m there is a huge choice of premium property - eg: period 6 bedrooms, converted barn in a acre or two, 3000 sq ft high end with outbuildings etc. Modern estate 4 beds from £0.3-0.5m.

I choose this price level, not because all can afford it, but as people currently in the London commuter belt can sell up, buy a much larger property, with some land if wanted, and still have money left over.

Mixed rural and urban area. Close to Dartmoor Exmoor, Quantocks. Close to Bristol or English channel. 2 hours from London by train. Many who now find the office only needs them a day or two a fortnight can easily relocate.

I can only suspect that WFH within a 2-3 hours drive or train ride will become increasingly attractive for many.