An existential question hangs like summer thunder clouds over Labor Day this year.
Traditionally, the phrases “post-Labor Day” and “back-to-work” have been interchangeable. But what does back to work even mean in an age when commuting to work is opening your laptop on the kitchen table?
There are few places on earth where the ultimate answer to this question will be more significant than Manhattan, whose economy, lifestyle and very physical environment is built around office work. Few places have been more disrupted by the way the pandemic is altering our ideas of how, and where, we work.
“I don’t think it’s ever going to be the same as it was pre-COVID,” said a man who has been living in the disruption, Jeffrey Gural, chair of GFP real estate, which owns 40 office and retail buildings in Manhattan.
Employers have steadily retreated from the hope they had clung to earlier in the pandemic that workers would resume their old five-day grind in the office.
“The COVID-19 pandemic prompted a major shift in the organization of work, as office workers shifted dramatically to remote and hybrid schedules,” the city’s comptroller, Brad Lander, just wrote in a special report on office use. “The data suggest those changes are here to stay, but the impacts of these shifts are only beginning to be felt.”
Lander made it clear that many other shoes – Birkenstocks more than wingtips these days – are yet to drop.
“We don’t yet know to what extent office-using businesses will reduce their per-worker footprint, how a structural shift in demand would affect office vacancy rates and rents, or how owners and tenants might repurpose vacant space through ‘adaptive reuse.’ These shifts, of course, will affect transportation needs, commercial and residential land use patterns, tax revenues, and many other aspects of the City’s economy.”
Overall, workers showing up to their office in Manhattan has remained stubbornly far below what it was before the pandemic. Indeed, office use actually peaked in late June at 42.5 percent of pre-Covid levels and slumped through the summer, according to the now widely followed passcard swipe data of Kastle Systems, the security firm.
Maybe, the end of summer will see some return to the office?
Maybe, but new patterns are starting to harden. Office use is clearly higher Tuesday through Thursday. Friday is the new Saturday.
“Everybody has seen that, that’s a fact,” says Gural. “The people who have really been affected are the mom and pop restaurants that cater to office workers who would stop and get coffee and a donut in the morning and a salad in the afternoon. They have seen a dramatic decline in their business on Friday.”
Before the pandemic, New York City’s unemployment rate had been at or below the national unemployment rate, both of which were under 4%. But now local unemployment is stuck above 6% while the national rate was 3.7 % in August.
A big reason for this lingering gap is this disruption of Manhattan businesses who are dependent on office workers who still have their jobs but are no longer coming to their offices.
All of which helps explain the urgency that Gural and many others feel about doing what they can to coax workers back.
Free Coffee and Donuts
Gural’s buildings offered free coffee and donuts once a week last winter and spring and will begin doing so again next week (but only on a Tuesday, a Wednesday or a Thursday). They also threw ice cream socials this summer and, dramatically, held a contest to give away tickets for big name performers at the Meadowlands.
You entered the contest when you entered the building. “It gave you a reward for coming to work that day,” explained Gural.
“Thank you so much for the tickets to see Paul McCartney in concert,” Ellen at the March of Dimes, which is a tenant, wrote to Gural. “Such a nice incentive for employees to come back to the office and even a nicer recognition for those of us who never left!”
Gural acknowledges that he has no idea if the ticket giveaway encouraged anyone to come to work who otherwise would not have. But at least it made tenants who did come to work feel appreciated.
“People like getting the free cup of coffee and donuts. I think they like the contest. So I’m going to keep doing it. At least it shows we are trying to incentivize you to come to work and we’ll keep going. That’s my plan.”
Gural has a new contest for fall. He is giving away tickets to sit in his box for Jets and Giants Football Games. Again, tenants enter when they clock in to enter one of his buildings.
Gural says he will keep searching for other ways to encourage folks to come into work. He is installing better air filtration in many buildings and he is considering creating child care programs.
Concern About Crime
But reviving the culture of office work is, he admits, beyond the power of any one landlord.
He would like to see the city and state address the widespread concern about crime by reversing liberal bail laws.
Crime isn’t really all that bad, he says. But the perception of rampant crime is a concern for his tenants, although transit officials note that for all the talk of crime in the transit system, subway and commuter rail ridership on weekends is recovering well, and far better than during the week, suggesting that it’s the destination not the trip that is the bigger deterrent to ridership.
Similiarly, overall transit ridership has clambered back to about 60 percent of pre pandemic levels. But at the big Manhattan hubs—the ones office workers use to get to work – ridership is still only about half of what it was.
Employers, Gural says, hold the real key to getting workers back in the office. “I’ve heard bosses, people who own companies, say publicly ‘I hope my competitors allow their employees to work from home’.”
This attitude, he hopes, will lead to management policies that encourage a return to the office.
“Have they promoted people who come to work? Or promoted people who don’t come to work?” Gural asked. “My guess is they’re going to say, basically, ‘we tend to promote the people who come to work.’ Then you’re going to have to decide yourself, do I want to be in a position to get a promotion? And if I do, I better show my face so the boss sees me once and awhile.”