For many in the Seattle area, Monday’s back-to-back back-to-office announcements by Microsoft and Expedia seemed to confirm a real momentum in the region’s recovery from COVID.
Since then, politicians and business leaders have talked of “tipping points” and have predicted more back-to-office announcements — along with the welcome prospect of more workers returning to still-moribund downtowns and commercial districts.
Almost on cue, a day after Monday’s news, Seattle Mayor Bruce Harrell used his first State of the City address to announce that many city workers currently working remotely will come back to the office next month. Weyerhaeuser, which cited public safety concerns last fall when it put off reopening its downtown Seattle headquarters, followed suit Thursday and told workers to be ready to return to Pioneer Square in late April.
“What it signals is that there’s relative confidence in the safety of bringing the workforce back together,” Patrick Bannon, president of the Bellevue Downtown Association, said of Microsoft’s announcement. “I can’t wait to see more people back in downtown, especially in this area where the office towers have been really quiet during the pandemic.”
But, in a way, the flurry of announcements also showed how far the region’s office-based economy remains from its pre-pandemic glory.
Conspicuously absent was any news about Amazon. The retail behemoth has stopped trying to predict a companywide return date, and is instead leaving its back-to-office policy to individual team leaders.
More broadly, many employers that have returned or set return dates aren’t actually back full time, but are using a mix of remote and in-office work.
Expedia will allow employees to work remotely roughly half of the time. Microsoft will use a “hybrid” model where employees’ work location is arranged between workers and team managers even after offices reopen. Weyerhaeuser is also going with a hybrid plan.
And for every employer aiming to be mostly in-office after the pandemic, such as Bellevue-based T-Mobile, there seems to be another like Zillow, a Seattle-based real estate company, that is remaining mostly remote.
Workers themselves are split — and deeply conflicted. Many remote employees have welcomed getting back to the office, and out of the house; for others, the return is unwelcome.
When Mitchell Yin’s team at the city of Seattle’s Department of Transportation recently shifted to a mostly in-office schedule, it meant Yin had to resume his Issaquah-to-downtown-Seattle commute.
“Look, I get the arguments that it’s good to go in the office at least once a week … to get some face time,” says Yin. But by ending remote work, Yin says, it’s as if employers are telling workers, “Oh, you want me to spend less time with my family.”
Yin isn’t alone. In a region that enthusiastically embraced remote work — 48.7% of Seattle-area workers were teleworking early in the pandemic — employers already struggling to hire worry about issuing back-to-office edicts.
“We’re definitely not going to force it,” says Eric Johnson, CEO of Nintex, a Bellevue-based process automation firm that will only require workers to come in a few times a year.
“And actually, I’m really hoping some of the super-large companies do, because we’ll be able to pick up some of their people,” Johnson adds.
The diversity in back-to-office strategies and worker responses shows how unsettled the region remains over a question that is no longer primarily about worker safety.
“The thing that makes this so tricky for employers — and for everyone trying to forecast what it’s going to look like — is that something that happened because of a public health emergency has now opened up these questions of the rhythm of work and the quality of work, and what sorts of workplaces not only serve the interests of employers but also the interests of employees,” says Margaret O’Mara, a University of Washington historian who has written extensively about tech hubs like Seattle.
That uncertainty, in turn, has huge implications for everything from the growing divide between white-collar and blue-collar work to the health of the commercial real estate business to the future of downtowns.
The number of office workers in downtown Seattle has hovered around 25% of 2019 levels for much of the last 12 months, albeit with an encouraging uptick recently, according to the Downtown Seattle Association.
In downtown Tacoma, 30% to 40% of office “seats are filled,” says David Schroedel, executive director of the Downtown Tacoma Partnership. In downtown Bellevue, where Amazon alone has added or is building more than 5 million square feet and Microsoft has a significant presence, perhaps a third of office workers are already back, says the Bellevue association’s Bannon.
Officials in all three downtowns expect those percentages to jump as omicron wanes, as the weather warms and as back-to-office momentum builds. Schroedel anticipates close to 70% occupancy in downtown Tacoma by June. Bannon is hoping for at least 50% by then. Meanwhile, Downtown Seattle Association CEO Jon Scholes predicts that the “majority of downtown’s office workers will return, even if it’s a hybrid model and the hours aren’t 9 to 5.”
That would bring much-needed trade back for the thousands of downtown restaurants, retailers and other businesses that once depended on office workers; it would also bring back work for the janitors, drivers and other blue-collar workers who kept those offices running.
But even the most bullish of downtown boosters acknowledges the real pace will be largely determined by the calculations of each company. Over the next few months, says Bannon, employers will be “doing their own internal soul-searching about what the right fit will be for their teams.”
Form follows function
That soul-searching covers a complicated gamut of concerns around work such as company size, productivity, work-life balance, or recruitment and retention.
At T-Mobile, CEO Mike Sievert has told employees that while there will be more flexibility than before the pandemic, the company’s corporate objectives, such as rapidly expanding its phone network, are best executed in person, said Matthieu Marescaux, an engineer at the company’s Factoria facility.
“They’ve been straightforward,” says Marescaux of the company’s emphasis on an office-based culture — a return Marescaux supports. Even with all the remote tools now available, he says, “it’s not as good as being with somebody in person.”
That desire is shared by many professional services employers. Nationally, nearly 57% of law firm employees are back in the office, or nearly double the average for all sectors, according to data compiled by Kastle, a key-card company.
“Our work involves a lot of collaboration,” says Greg Russell, managing partner at Bellevue-based law firm Peterson Russell Kelly Livengood, where 90% of staff are now back in-office most of the time. “You can do it on Zoom and Microsoft Teams, but it’s harder.”
Some tech firms have also voiced concerns about remote work’s effects — an irony, given how the tech sector embraced telework early in the pandemic.
At Microsoft, the shift to remote work “caused the formal business groups and informal communities within Microsoft to become less interconnected and more siloed,” according to a Microsoft study posted in September. The time workers spent collaborating with colleagues in other groups fell by around 25%.
Amazon hasn’t been as forthcoming about its own remote work experience. But privately, some company insiders say similar communication challenges hampered processes that require intense collaboration, such as innovation and product development.
While day-to-day “‘keep the lights on’ efforts are fine … some of the more forward-looking new product development has certainly been affected,” said one manager based in the Seattle area who has worked in Amazon Web Services, the company’s cloud computing arm.
After going remote in 2020, “I think we just all retreated to like, ‘Well, OK, I know what I need to do today to keep the system up and running and keep the customers happy,'” added the employee, who asked to remain anonymous because they were not cleared to talk to the media.
Amazon declined to comment on those concerns. But in a letter to employees last fall, CEO Andy Jassy made clear that the company’s back-to-office strategy, though it would be managed at the team level, would still have a performance-based bottom line.
Return-to-office decisions, Jassy wrote, “should be guided by what will be most effective for our customers; and not surprisingly, we will all continue to be evaluated by how we deliver for customers, regardless of where the work is performed.”
C-level sentiments such as these coupled with the fact that many big employers have kept much of their current office space — or expanded it, in Amazon’s case — suggest that many employers ultimately want a more office-focused model once the pandemic mellows.
Across the Puget Sound region, office leases were up by 11.3%, and 63% in downtown Seattle, in 2021 versus 2020, according to CBRE, a global real estate firm. The uptick reflects general economic recovery, but also the fact that employers have begun to work out “how they were going to deal with the hybrid workplace,” said John Miller, senior managing director of CBRE’s Pacific Northwest offices.
Although many employers will adopt some form of hybrid model — CBRE estimates the average white-collar job will be remote 1.6 days a week, up from 0.6 days before COVID — the firm doesn’t expect employers to dramatically reduce the size of their offices.
The ideal post-pandemic office, Miller predicts, is a space that is as comfortable as the home office while also inviting the kind of collaborative work that isn’t possible at home. “Employees will do their heads-down work at home and come into the office to meet with clients and be around their co-workers,” he says.
Those efforts aren’t confined to homier workspaces. Free or subsidized food is becoming common as firms look to entice workers back to the office.
For many business leaders, politicians and other boosters of downtowns, these continuedinvestments are the surest proof that offices will once again be full or nearly full ofworkers.
There are other views. While many big employers are keeping their space, some smaller ones used remote work to shrink their offices.
Nintex, the Bellevue tech company, has subleased around 75% of the local space it had before the pandemic and redesigned the remainder “around people being able to come in occasionally with their team,” CEO Johnson says. “Effectively, Nintex has become a fully remote company.”
And, importantly, even attractive offices and free lunches may not be sufficient for workers who simply don’t want to come in. Tech employers in particular are under pressure to maintain flexible arrangements after COVID.
In the Seattle area, 28% of tech workers wanted to work fully remotely after the pandemic, and 56% want a hybrid approach, according to a survey of 467 workers conducted last summer by EMC Research for Sea.Citi, a Seattle-based nonprofit. Just 14% wanted to work from an office full time. Nicholas Merriam, CEO of Sea.Citi, said there is little to suggest those sentiments have changed.
That helps explain why many large tech firms have either embraced remote or hybrid work arrangements or postponed back-to-office plans. At Amazon, some managers say they worry about losing workers to competing firms or to other more flexible Amazon teams.
According to a December survey by Zillow, 1 in 4 workers was “quite likely, very likely or almost certain” to consider switching jobs “if their employer requires them to work in-person full-time.”
In fact, in the post-pandemic world, flexible work arrangements may trump free lunches as a recruitment tool.
Zillow saw the number of job applications jump nearly 56% in the first half of 2021, compared with the same period in 2019, after company announcements that employees would be allowed to work largely remotely.
Another benefit of flexibility: Zillow saw a 17% increase in the number of female applicants and a 21% increase in female managers and executive new hires in the same period, the company said.
“Candidates are really looking for flexibility,” says Dan Spaulding, chief people officer at Zillow. And, Spaulding says, “we’ve been very public about being flexible.”
That dynamic may intensify as more employers announce back-to-work strategies.
“Workers now are a lot more in the driver’s seat about their employment than they have been in the past,” said Merriam at Sea.Citi. If remote work was the exception before COVID, it’s “becoming a key benefit offer that companies have to consider if they’re going to attract and retain talent.”
Merriam doesn’t think the big office is obsolete: Surveys show that even employees who come in just a few days a week prefer to have a dedicated desk, and don’t embrace “hoteling” in shared desks, he says.
But Merriam is not convinced those offices will attract anywhere near the same number of workers, regardless of the amenities. His “back of the envelope” estimate is that the number of downtown office workers after COVID will likely be down as much as 40%.
Whatever the ultimate level turns out to be, Merriam thinks it could be years before employers and employees come to a new consensus about the shape of work.
“We’re in the early days of this great experiment around remote and hybrid work,” Merriam says. “This is just beginning.”