Empty office

In 1964 the future of work looked like it would be fully online. In the past few years the pandemic has “scrambled” our cities. What does the future of work look like now?

A new report from Hub Australia and WORKTECH Academy, titled Liberated Work, has found the pandemic has radically shifted our expectations and behaviours around work, with 56 per cent of workers saying they would consider switching employers if increased flexibility isn’t an option. What does the future of work look like?

Lately, it seems like a lot of people are talking about the future of the office. 

It seemingly hangs in the balance, caught between the desperate pull of the real estate industry trying to fill empty offices, and the comfy allure of the home-based workspace (complete with weighted blanket and fluffy pyjamas that look like a business shirt for those Zoom meetings!). 

In a 1964 interview with the BBC, science fiction writer Arthur C Clarke predicted that in the year 2014, we would have wireless communications, making us “in instant contact with each other, wherever we may be”.

He predicted that workers would no longer commute to their offices and travel “only for pleasure”.

In the 1980s, the personal computer came onto the market and was soon widely used in every office. 

With the rise of the dot com boom and work-life balance in the 90s, people began to think that computer power would enable them to work less and have more time to play. (It was all to be part of “the paperless office”.)

In the 1950s, early Australian computer scientist (my grandfather) Dr John Makepeace Bennett predicted that by the 2000s the personal computer would fit inside a small room (wow, imagine that!).

In the late 2010s Atlassian predicted that in the 2020s workers would care less about where they work, and more about how they work within their team. 

So what actually happened?

The major disruption of the Covid-19 pandemic abruptly shuttered the majority of non-essential workers inside their homes, with the instructions to “shelter in place” and “self-isolate” until vaccines were available and restrictions eased. 

During that time of introspection, people experienced a radical shift in their personal and professional priorities, with workers prioritising time with their families and out in nature rather than chained to a desk in the big smoke. 

According to demographer and statistician Simon Kuestenmacher, the pandemic has “scrambled” our cities. More people are wanting to work remotely from the suburbs rather than commute into the CBD. 

“The typical pre-pandemic capital city in Australia essentially looked like a fried egg – all the fat, delicious juicy jobs are clustered in the CBD, in the city centre,” Kuestenmacher stated at the Property Congress in Hobart last week.

Commuting from the far edges of the city (the egg white) to the city centre (the yolk) can be a “soul destroying commute“, Kuestenmacher said. This meant that prior to the pandemic, people were willing to pay an arm and a leg to live as close “to the egg yolk as possible”. 

However, with the pandemic shuttering a large proportion of the workforce inside their homes, and as businesses investing in the tech and infrastructure to support that trend, the dynamic has become unrecognisable. 

“It was almost like we took a spatula to our fried egg, and we turned it into a scrambled egg city. 

“All of a sudden, more and more workers were free to act on a housing market like retirees. Meaning they were not shackled by the CBD anymore, they could choose their city of choice and their suburb of choice based on other factors – mostly liveability, affordability, personal preference and family relations.” 

During 2020-21, the regions grew by 70,900 people while the capital cities lost 26,000, according to the Australian Bureau of Statistics (ABS).

What does it mean for businesses? 

Many found the benefits enough to keep the model running, even after the restrictions had eased and staff were vaccinated. They found the results for their companies were that working from home was cheaper, better for productivity and better for the environment. 

Not only that, but businesses cut down on embodied and upfront carbon from building office buildings, as well as the pollution caused by peak hour commuters.

Many workers have enjoyed being spared the daily commutes and the opportunity for more work-life balance. 

No more sitting in a car for hours a day (think about this – sitting in a car or on a bus for the average commute time of just over an hour every day equates to an entire day of the week of wasted time). 

56 per cent of workers would consider switching employers if increased flexibility isn’t an option, according to a new study from Hub Australia and WORKTECH Academy “Liberated Work”.

Distributed working also allows companies to access a global talent pool, as prospective employees no longer need to live within a commuting distance. 

Tim Hill, co-founder of engineering start-up Neuron, decided to relocate to the south of France during the pandemic.

“From the beginning we had decided that we wanted our staff to be able to work from any location in the world.

“Being a remote-first business lets us have proactive collaboration from any location.”

The company has six staff working across Australian cities including Sydney, Melbourne, and Darwin, as well as overseas in India and France. 

And, of course, the company no longer has to worry about overhead expenses from rent, electricity and office supplies. 

And staff are happier and more productive for it, according to a new study from Hub Australia and WORKTECH Academy. 

According to the study, 38 per cent of workers were more productive. 

More than half of all workers (55 per cent) said hybrid work has benefitted their work-life balance. 53 per cent would forego a pay increase to work flexible hours.  A similar number (56 per cent) would consider switching employers if increased flexibility isn’t an option.

The rise of the hybrid role

With government restrictions easing and the majority of Australians vaccinated, many businesses are choosing to bring their staff back to the office – at least some of the time. 

Just 14 per cent have returned five days a week, 66 per cent have returned one to four days a week, and 19 per cent have not returned at all. 

When employees were asked where they see themselves working in the next 10 years, 58 per cent said they expect to be working in a hybrid way across multiple different locations. 

A study from Stanford University found that productivity gains nearly doubled when employees had a choice to where they worked (as compared to productivity gains from remote working). 

And this shift towards a hybrid office-home model, as well as the threat of staff turnover, is meaning that the businesses are having to create office environments that are attractive to staff, that offer a high degree of comfort and sustainability. 

The “commute to the CBD” model is dead – companies that are not going for the full-time work from home model are opting for hybrid office locations in the fringes or the suburbs. Communities are becoming more decentralised, with people preferring to stay within their own suburb rather than travel significant distances to other suburbs. 

Perhaps the egg is not becoming “scrambled”. Perhaps smaller “yolks” are popping up across the suburbs instead of the CBD. 

It’s not the first time that the “egg” has been scrambled

It was the industrial revolution that led to the rise of cities as farmers moved to the urban areas to find work. By the mid-19th century, suburban sprawl began to emerge as the cities became more overcrowded and unsanitary. 

The rise of a public transport system and the personal vehicle was a major catalyst for suburban growth. 

In the 1980s there was a shift from the “main street” to big malls. At the same time, massive rent increases were putting more pressure on small to medium businesses. 

Then the pandemic happened. And we saw a mass exodus out of the cities to rural areas. 

“Certainly, during Covid, there was an increase in interest from people looking to move here,” Brett Waller, real estate agent at Castlemaine Property Group told The Fifth Estate

PwC estimates that migration out of the cities will amount to a loss of around 500,000 in urban population by 2031 – a 7.6 per cent decline on what was previously expected.

“Nowadays it’s easier to work from home so people are bringing forward their life changes…  Covid has had people stop and think about their lives and what they want.”

“Obviously over the last two years with COVID there’s been a magnifying effect with people not being able to access freedoms they would like in Sydney. They’re looking at where they can afford and work from home,” Michael Wright, real estate agent at Peter Fisher Real Estate in Orange, said.

“Most people are enquiring about internet availability… so most people are seemingly working from home when they move here.”

In an example of movement out of the city centre, the Geelong Quarter is a mixed-use development set to open at the end of 2022. 

“There has been a huge increase in people moving from Melbourne to Geelong,” said Paul Franze, founder of Franzé Developments, which is spearheading the project. 

“We knew Geelong was on the cusp of transformation and to be at the forefront of the magnitude of the revitalisation is inspiring.”

A new kind of office

This vision means that workers either continue to work remotely, or that companies utilise coworking office space, which might just fit the bill for people who need a place to go to. 

Businesses will need to provide more amenities to employees or risk losing them to the competition. People-focused design will need to replace desk space with collaborative breakout spaces, parents rooms, and end-of-trip facilities. Health, hygiene and comfort will need to be prioritised. 

The “main street” – those partially forgotten hubs of activity that breathe life into local communities – may become revitalised as people have more time to stick around within their own suburbs. 

The 15 minute city is the design and planning principle that every citizen should be able to walk only 15 minute to reach all essential goods and services.  Clockwise, the headings read: Learn, Work, Share and Re-Use, Get Supplies, Take the Air, Self-Develop and Connect, Look After Yourself, Get Around, Spend, and Eat Well. (Paris en Commun): Public Domain

“If more people were to work from home, neighbourhoods might spring back to life. Imagine a relaunch of Jane Jacobs’s urban ideal, where neighbourhoods have a diverse range of work and family functions, where municipal spending goes into parks, not urban expressways, and where single-use areas, like clusters of downtown office towers, dead at night, become archaic,” Eric Reguly wrote in The Globe and Mail.

That’s the ideal of the 15 minute city: the design and planning principle that every citizen should be able to walk only 15 minute to reach all essential goods and services. 

Long term, PwC estimates this migration out of the cities will amount to a loss of around 500,000 in urban population by 2031 – a 7.6 per cent decline on what was previously expected. 

Of course, there are aspects of physically being together with colleagues that are difficult to replace with technology. That is where resistance comes from. How will we foster good working relationships? How will we have that innovation, that teamwork, that flow of ideas? 

To build good virtual working relationships, everyone has to work a little harder – leaders most of all. 

Half of workers cite collaboration as the main reason to return to the office, and according to the Hub Australia study, 23 per cent of employees say they “never” feel connected to the workplace when they work virtually. 

So, working from home doesn’t suit everyone, all of the time. 

But in many ways, this is the sort of thing that companies should have been conscious of already. If your culture is bad whilst hybrid working or working remotely, then it probably wasn’t that good to begin with. 

A fifth of respondents to the Hub Australia study believe the physical office will become obsolete in the next decade. It is important that companies invest in the tools and training to ensure that no one gets left behind.

“Full-time office work was a ‘one-size-fits-all’ solution to the endless complexity of work and life – and as such, it was always destined for failure,” states the report. 

Hybrid work is a stepping stone to a more advanced vision of the future of flexible work  – a form that will see workers equipped with everything they need to work anywhere, and be supported to do the best job that they can. 

“Liberated work,” as the report puts it, requires a company to invest in the right equipment and tools, so that employees can work together in the same “virtual” space, even when they’re miles apart. 

For older workers, it means investing in training so that no one gets left behind. 

Interestingly, a fifth of respondents to the Hub Australia study believe the physical office will become obsolete in the next decade.

Having access to flexible collaborative spaces, like coworking spaces, supported by the tools of technology that allow staff to work from anywhere, will foster a renaissance of creative innovation through cross-border knowledge sharing.

No longer does it take a physical office space to say, “this is a workplace”.

There is nothing new about Zoom, and the internet has been around for decades. 

So why did it take a global pandemic to shift the culture of work, when the tools and incentive were already there? 

Noah Smith, former Bloomberg columnist last year wrote: “when new technologies appear, you can’t always just swap them out for existing ones – you often have to entirely reorganise your systems of production around the new technology.”

Work has now changed from a place to a process. 

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