The Biggest Winners and Losers From the Work-From-Home Revolution
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    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,587,785 (-9.64%)       Melbourne $968,477 (-1.28%)       Brisbane $894,769 (-1.51%)       Adelaide $810,780 (-6.94%)       Perth $764,276 (-4.92%)       Hobart $750,134 (+1.16%)       Darwin $645,801 (-3.38%)       Canberra $1,017,220 (+3.56%)       National $1,010,264 (-5.75%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $725,381 (-1.27%)       Melbourne $488,555 (-0.24%)       Brisbane $499,581 (-5.39%)       Adelaide $411,364 (-4.41%)       Perth $414,273 (-2.57%)       Hobart $498,192 (-6.11%)       Darwin $351,130 (-4.84%)       Canberra $480,942 (-4.46%)       National $506,040 (-3.24%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 10,047 (+6,578)       Melbourne 14,543 (+5,785)       Brisbane 8,228 (+1,243)       Adelaide 2,741 (+600)       Perth 6,788 (+1,322)       Hobart 1,219 (+48)       Darwin 269 (+17)       Canberra 1,013 (+155)       National 44,848 (+15,748)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 8,226 (+4,905)       Melbourne 7,846 (+2,295)       Brisbane 1,759 (+304)       Adelaide 499 (+101)       Perth 1,899 (+331)       Hobart 186 (-9)       Darwin 388 (+26)       Canberra 854 (+60)       National 21,657 (+8,013)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $780 ($0)       Melbourne $590 ($0)       Brisbane $620 ($0)       Adelaide $600 ($0)       Perth $650 ($0)       Hobart $550 (-$10)       Darwin $680 ($0)       Canberra $690 ($0)       National $652 (-$1)                UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $725 (-$5)       Melbourne $580 ($0)       Brisbane $620 (-$10)       Adelaide $450 (-$20)       Perth $600 (+$15)       Hobart $470 (-$10)       Darwin $570 ($0)       Canberra $570 ($0)       National $584 (-$3)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 5,614 (+7)       Melbourne 5,631 (-24)       Brisbane 4,055 (-125)       Adelaide 1,248 (+4)       Perth 1,830 (+7)       Hobart 380 (+12)       Darwin 153 (-19)       Canberra 664 (-12)       National 19,575 (-150)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 7,725 (-368)       Melbourne 5,038 (-276)       Brisbane 2,044 (-65)       Adelaide 394 (+11)       Perth 594 (-34)       Hobart 139 (+1)       Darwin 285 (-5)       Canberra 590 (-16)       National 16,809 (-752)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.55% (↑)      Melbourne 3.17% (↑)      Brisbane 3.60% (↑)      Adelaide 3.85% (↑)      Perth 4.42% (↑)        Hobart 3.81% (↓)     Darwin 5.48% (↑)        Canberra 3.53% (↓)     National 3.36% (↑)             UNIT ANNUAL GROSS YIELDS AND TREND       Sydney 5.20% (↑)      Melbourne 6.17% (↑)      Brisbane 6.45% (↑)      Adelaide 5.69% (↑)      Perth 7.53% (↑)      Hobart 4.91% (↑)      Darwin 8.44% (↑)      Canberra 6.16% (↑)      National 6.01% (↑)             HOUSE RENTAL VACANCY RATES AND TREND       Sydney 0.7% (↑)      Melbourne 0.8% (↑)      Brisbane 0.4% (↑)      Adelaide 0.4% (↑)      Perth 1.2% (↑)      Hobart 0.6% (↑)      Darwin 1.1% (↑)      Canberra 0.7% (↑)      National 0.7% (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 0.9% (↑)      Melbourne 1.4% (↑)      Brisbane 0.7% (↑)      Adelaide 0.3% (↑)      Perth 0.4% (↑)      Hobart 1.5% (↑)      Darwin 0.8% (↑)      Canberra 1.3% (↑)        National 0.9% (↓)            AVERAGE DAYS TO SELL HOUSES AND TREND         Sydney 36.6 (↓)       Melbourne 40.8 (↓)       Brisbane 36.8 (↓)       Adelaide 31.2 (↓)       Perth 41.1 (↓)       Hobart 41.6 (↓)       Darwin 49.2 (↓)       Canberra 39.9 (↓)       National 39.7 (↓)            AVERAGE DAYS TO SELL UNITS AND TREND         Sydney 36.2 (↓)       Melbourne 39.2 (↓)       Brisbane 33.8 (↓)       Adelaide 30.0 (↓)     Perth 43.3 (↑)      Hobart 43.8 (↑)        Darwin 33.7 (↓)       Canberra 45.3 (↓)       National 38.2 (↓)           
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The Biggest Winners and Losers From the Work-From-Home Revolution

Remote or hybrid work has become the new normal for millions of people. We are only just starting to see the impact.

By NICHOLAS BLOOM
Fri, Dec 15, 2023 9:06amGrey Clock 4 min

The fivefold increase in working from home ushered in by the pandemic is perhaps the largest change to hit U.S. labor markets since World War II. It has touched just about every manager in America, reshaped industries including real estate and business travel, and led to an exodus from city centres to the suburbs.

And working from home is here to stay—at least in a hybrid model where a commute to the office is limited to just a few days each week. Tracking detailed survey data, we see working-from-home levels were rapidly dropping from 2020 to 2022. But by early 2023 they stabilised and have remained flat ever since. Hybrid working has become the new normal for millions of professionals and managers across America.

So, it’s time to tally up the impact. Looking ahead to 2024 and beyond, who are the biggest winners and losers from the work-from-home revolution?

Start with the losers

The biggest losers are likely city-centre office and retail property owners. The massive shift to home working has created a doughnut effect in major cities around the world. Millions of employees are no longer commuting every day, leaving many offices half-filled and retail stores struggling for customers. The owners of this real estate—often pension funds, family firms and endowments—have collectively lost hundreds of billions of dollars of investments.

In the long run, the sector will slowly recover as supply contracts. New construction has slowed, some empty buildings are slowly being converted to residential accommodation, and some lower-quality offices will be torn down. But recovery will take years to complete. Winter has come for the office sector. One forecast that a major leasing company shared with me was it would take until 2033 for occupancy to recover to pre pandemic levels in San Francisco—perhaps the hardest hit city.

Another loser has been mass-transit rail systems. Ridership has dropped by 30% nationally as commuters shift from a five-day commuting schedule to two or three days a week. These commuter rail systems have high fixed costs due to inflexible track and train costs, alongside rigid union-controlled labor expenses.

Large drops in ridership revenue translate into larger budget deficits. To date these deficits have been bailed out by pandemic-era federal and state subsidies. But the fear is unless public transit costs can be right-sized, once these subsidies run out they will see devastating service cuts or outright closure.

Growing up in Britain, I heard about the infamous Beeching cuts of the 1960s, which cut station numbers by 55% and devastated rail travel. I fear something similar happening to U.S. transit for 2024 and beyond unless operators and unions can align cost with revenues.

The third big loser has been big cities. American cities occupy surprisingly small spaces. For example, San Francisco is less than 50 square miles, comprising just the tip of a peninsula. So, when city-centre residents fled for the suburbs, they took their tax dollars with them.

As we know from the experience of New York in the 1970s, cities can adjust by cutting expenditures. But this will be painful and risks a hollowing out of city centers if key services like police and education are cut. Indeed, bond markets have already cut the prices of many city municipal bonds, providing an ominous signal of the budgetary struggles ahead.

But there are winners

It isn’t all gloomy, particularly for the biggest work-from-home winners: the workers. In national surveys, employees report they value the ability to work from home two or three days a week as much as an 8% pay increase. Multiplied across the roughly 70 million Americans who are currently working from home, this is a perk valued at roughly $500 billion a year. This vast dividend has benefited employees through less commuting and lower stress, alongside more personal, leisure and family time.

One recent study highlighted how the typical U.S. home-working employee spends 40 minutes more a week on child care from the time saved from avoiding the daily commute. This will have longer-run effects ranging from higher labor-force participation rates—possibly pushing up growth rates—to potentially even a fertility dividend as parenting becomes somewhat easier.

Another winner is the environment, thanks to reduced travel and energy needs. A recent study found working from home two days a week reduces pollution by about 15%. This comes from lower commuting emissions alongside additional savings from lower office energy bills. A double dividend is the reduced congestion on emptier roads, with traffic speed data from Inryx suggesting the morning commute is 10% faster.

And perhaps the biggest work-from-home winner are companies. Research finds that hybrid working three days a week in the office has a net neutral on employee productivity, while allowing firms to save on recruitment and retention costs. Firms can save money by trimming office expenses while using remote working to lower labour costs by hiring employees outside major cities.

U.S. firms made about $1 trillion higher profits in 2022 than in 2019, an increase of almost 50%. While many factors likely contributed to this, including the strong economic growth, it is notable this happened alongside the fivefold surge in working from home. Indeed, the mass adoption of hybrid working by millions of firms across the U.S. and Europe is perhaps the strongest evidence of its positive impact on profitability.

Looking further out, the biggest change will almost surely come from the new technologies we use to work remotely. When I first started working in the 1990s, working remotely meant conference calls and emailing files. Now we telecommute and share files on cloud networks.

The future likely heralds similarly large changes. In discussions with startups and tech firms, I hear about systems for holographic meetings, wall-size screens and global connectivity. This technology means working from home hasn’t just stabilised but is now moving into its longer-run phase of expansion. Ten years from now we will look back at 2023 as the beginning of the long bull market in hybrid working.

Nicholas Bloom is a professor of economics at Stanford University.



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Even amid two international conflicts and an upcoming U.S. presidential election, some philanthropic leaders are optimistic about the direction of overall giving through 2024.

Penta spoke with heads of several non-profits and leading philanthropists to gauge whether charitable giving will continue its reported slump from 2023 or rebound alongside renewed interest in various political and economic issues.

“Contrary to what some might expect, philanthropy has had resilience in these times,” says Stacy Huston, executive director of Sixdegrees.org, a youth empowerment non-profit based in Virginia founded by actor Kevin Bacon in 2007.

Huston’s view echoes recent data from the biennial Bank of America Study of Philanthropy published last year, which found that while affluent giving is largely down, the value of the average philanthropic gift is up 19%, surpassing pre-pandemic levels.

The notion of what these gifts look like is changing, and is partially responsible for the growth. Philanthropy can be executed through more avenues than ever, whether through celebrity association, tech titans stewarding large endowments, or  athletes using their platforms to advocate for and create meaningful change.

“The industry and movement is creating new models, and you want to get it right,” says Scott Curran, CEO of Chicago-based Beyond Advisers. “No one should take their foot off the gas pedal.”

Curran spent a number of years with the Clinton Foundation in its infancy before leaving in 2016 to open his own consultancy, which focuses on philanthropy strategy at the highest levels. Curran and his team work with celebrities, athletes, multi-generational family foundations, and other affluent givers who need guidance in directing their philanthropic efforts. It’s a growing area of interest: Over half of affluent households with a net worth between US$5 million and US$20 million have, or are planning to establish, “some kind of giving vehicle” within the next three years, according to the Bank of America report.

Corporate philanthropy, rather than individual giving, is the cornerstone of Marcus Selig’s work as chief conservation officer at the National Forest Foundation, a Congressionally chartered non-profit based in Montana responsible for protecting millions of acres of public lands.

“Our outlook is business as usual,” he says, advising that giving may slow down, but not enough for the foundation to change course.

Factors such as political polarisation in the U.S. and the wars in Eastern Europe and the Middle East are pushing nonprofits to consider their niche, and how they might work with other groups, both on the corporate and philanthropic levels, Selig says.

“It leads to a little more sharing on the ground in what needs to be done,” he adds.

Steve Kaufer , founder of Massachusetts-headquartered e-commerce giving platform Give Freely and founder of TripAdvisor, says that the economy has a much bigger role in election years, as he looks to build and grow something that can act as a “counterbalance.”

“There’s a trend towards democratisation, and acting collectively can lead to greater impact,” he says.

Kaufer’s new platform hopes to leverage the everyday philanthropist through online shopping dollars to benefit major charity partners like UNICEF and charity:water, who earn funds as shoppers choose an organisation to benefit through an online clickthrough process.

“Whether a good year or bad year, e-commerce will continue to keep growing,” he says. “Nobody doubts that.”

Whether a legacy foundation, corporation or individual, the political landscape this year is requiring some to exercise caution as they consider what their own charitable actions might be and how it could be viewed more broadly. For the personal philanthropist, every move is now scrutinised more closely. On the nonprofit side, entities are exercising more due diligence to understand if a specific donor aligns with their mission and that there aren’t any underlying issues that could cause greater pushback.

“You have to be able to walk the walk,” Huston says. “For example, we’ve had to turn down very large donor checks from corporations because there’s a Reddit stream calling them out on their human rights practices.”

She adds that even a routine charity activation could now be aligned with a political party, and that adds complexities to how a higher-profile organisation like Six Degrees can activate, especially as the film Footloose turns 40 in 2024 (which Bacon starred in).

“A lot of organisations and states want to align themselves with this feel good moment, and we should be able to stand side by side with everyone, but we have to be aware,” she says.

Another topic attracting donor interest today is  mental health, an area that historically has been underfunded and under-resourced by philanthropy, according to Two Bridge partner Harris Schwartzberg, who has been closely linked to the mental health space for more than a decade.

Today, the issue for mental health nonprofits is less about resources and more about societal divisiveness and polarisation around the topic. There’s an “overwhelming demand” for solutions, but the space is in a “perfect storm” for the broader political issues to make things worse, Schwartzberg says.

In Curran’s opinion, the storms brewing are troublesome, but they are also creating new opportunities for corporate and personal giving. The  current state of philanthropy is one of “dynamic, expansive, and blurred lines,” meaning a careful blending of targeted giving combined with an understanding of the broader geopolitical landscape could lead to a successful overall philanthropic strategy.

“There are a lot of headlines that distract, but shouldn’t,” he says. “2024 needs more serious philanthropists than ever.”

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