Remote work has dramatic implications

Apple spent $5 billion on its spaceship campus in Cupertino, but it sat mostly empty in 2020 while work continued from employee homes.

Business forecasters say remote work is here to stay, and the consequences of this realignment will shake up cities, real estate prices, and life choices.

Although considered a slow-moving trend of the future, remote work accelerated during the 2020 pandemic. According to McKinsey Global Institute, about 20 percent of the global workforce could work remotely and still remain effective in their jobs.

According to a survey of 1,000 CEOs by FirstbaseHQ, companies are planning a 40 percent to 60 percent cut in office space, with about 30 percent going entirely remote.

The impact of this realignment from commercial office space to home-based work has wide-ranging consequences — not just for employees, but for the makeup of cities, companies, and neighborhoods across the country.

For companies, economics is easy. It costs companies about $20,000 per employee per year to have them work in office space, while remote work costs about $2,000 per employee.

Companies have yet to assess the impact of remote work on company culture, performance, and effectiveness, according to FirstbaseHQ. In addition, some employees may prefer to work in an office, especially after the isolated months in lockdown.

For cities, the trend is clear, for now at least. Commercial leases are down, empty office space is abundant and sales of city housing like condominiums are way down, while sales of suburban housing are up. What happens to the cities may depend on tax structures changing and amenities reopening, experts say. Meanwhile, remote workers are taking their families out of oppressively expensive city apartments to buy homes in middle American communities with lower taxes and simpler lifestyles.

For Apple, Microsoft, and Uber, who spent big on workspace with elaborate benefits from food to child care and game spaces, offices may remain a big draw, according to CNET.