Crain’s Editorial: Distant World | Crain’s Cleveland Business
Downtown Cleveland Alliance has done an amazing job creating events that bring downtown to life. The latest example: Lunch in the Lane, a series of pop-up block parties on Thursdays in different parts of downtown, all with food, games, live music and more. (The next one is this Thursday, June 23, from 11 a.m. to 1:30 p.m. on Huron Road between Euclid Avenue and East 12th.)
Lunch in the Lane and other events planned for this summer have more than fun in mind. DCA is doing what it can to entice workers back to their downtown offices rather than working from home. The organization’s recovery report released in April showed that weekday foot traffic to eight major downtown office buildings has improved but remains at around half of pre-pandemic levels. This is a big challenge for a healthy downtown, which relies on a combination of spending not only from residents and local visitors/tourists, but also from workers who eat and shop before, during and after the working day. .
The slow-to-return workforce in Cleveland isn’t unique.
The New York Times, in a June 9 article, stated categorically that “optimism about plans to return to the office, across industries and cities, is slowly waning.”
For example, The Times noted that when consulting firm Gartner asked in early 2021 what share of their employees would be back in the office five days a week in the future, executives answered 50%; that figure has now fallen to around 20%, according to a recent Gartner survey update. Nationwide office occupancy has plateaued at around 43%, the newspaper reported.
Many early predictions about the long-term implications of the pandemic failed to materialize. People are returning to bars, restaurants, sporting events, cinemas, etc. But office work is another story. Those who have been able to work remotely “have clung to flexibility,” as the Times put it. A recent Pew Research study found that the often predicted “zoom fatigue” did not significantly materialize and that 60% of workers who can work from home wanted to work remotely most of the time or all the time. Other factors, including the cost and limited availability of child care and rising gas prices, are contributing to office workers’ desire to continue doing their jobs largely or entirely from home.
More than two years of working from home during the pandemic has shown that much office work does not require the office to be done efficiently. Companies that hope workers will realize they love the office more than they remembered, or that they might be lured in by free snacks and drinks, are up against the reality that many people genuinely prefer to work from home when possible. (Bonus: they control the temperature of their own office.)
It is not our role or our intention to advise companies on how they should manage their return to work policies. Business owners and managers need to realize this for themselves, designing strategies that suit their business’ situation and positions in the market.
On some level, it makes sense that there is a lot of experimentation. Companies that believe they have a unique office culture that requires work to be done largely or entirely in person should stick with that. If that means occasionally losing some talent, that’s a new data point to factor into the cost-benefit analysis in the shifting equation of how best to structure the workforce.
However, the implications for cities are significant.
Cleveland Chief Financial Officer Ahmed Abonamah told Cleveland.com that income tax accounts for about 65% of the city’s general fund and that downtown is the largest center of employment. The Ohio Supreme Court agreed to take a case, Schaad v. Adler, which discusses whether people who worked from home during the pandemic should have paid commuter income taxes while their offices were empty. Solving the case could have implications for tax collection in the future as more workers do their jobs remotely.
More broadly, Cleveland and other cities will have to contend with the likelihood that foot traffic for office work will be in permanent decline, and that to keep downtowns bustling they will have to ramp up residential development and find alternative permanent entertainment options to attract people. something other than a game or a concert. Cleveland, with over 20,000 residents and an apartment building boom, is headed in the right direction. But there is a lot of work to be done because the nature of work is changing.