Americans aren’t returning to the office
The Future. Global office occupancy rates are on the rise, nearly returning to pre-pandemic levels in much of Europe, Asia, and the Middle East– but not in the US. Unique social and economic conditions in the United States have created a return-to-office gap that’s likely to persist. Long-term, that may mean depressed landlords and urban centers– but happier workers.
Only in America
Factors unique to Uncle Sam have left the US in a strange return-to-office position.
- Office occupancy has only hit 40-60% of pre-pandemic levels in the US while reaching 70-90% in Europe and the Middle East and 80-110% in Asia.
- The US’ ample territory and suburban structure allow for the construction of large single-family homes suitable for remote work. By creating highway jams and longer commutes, suburbs simultaneously disincentivize in-person work.
- Moreover, the US’ low 3.4% unemployment rate (just over half of Europe’s 6.1%) enables employees to choose remote work as they please. Low competition for job positions gives workers more leeway in negotiating work arrangements.
Exacerbating the situation for US landlords was the decade-long office boom that was in full swing before the pandemic and which doomed itself to failure by ignoring already high office vacancy rates.
No place like home
Analysts think this difference will last. The factors that put the US in this position existed before the pandemic, so they’re likely to persist long after it too. The economic position of landlords and US urban centers will get worse before they get better, and both will have to get creative to survive.
This can become a vicious cycle– no one wants to sit in an empty office, so they’ll leave. But on the bright side, no one will have to.