Tom Williams/CQ Roll Call via AP Images
People sit in outdoor furniture installed in Farragut Square in downtown Washington as part of a program to highlight D.C.’s return-to-work initiatives, May 4, 2021.
One of the more awkward lines in President Biden’s State of the Union address involved returning to a pre-COVID status quo, though he highlighted perhaps the least desirable aspect of that: the slog through a rush hour commute to a box with four walls and apprehensive co-workers. “It’s time for America to get back to work and fill our great downtowns again with people,” Biden said. “People working from home can feel safe and begin to return to their offices.” It didn’t draw the bipartisan applause speechwriters may have expected.
This was not a throwaway line. Biden returned to the theme last Friday while discussing the jobs numbers, using substantially the same language. It’s an echo of a message that has been offered by mayors and governors off and on over the past several months.
Biden’s eat-your-peas-and-get-back-to-the-office appeal was part of his campaign to highlight his administration’s COVID successes. And there’s certainly a logic to showing off that success through the spectacle of crowded downtowns, full restaurants, and a return to the rhythms of pre-pandemic life. But many Americans find restoring those rhythms distasteful, after getting hours of their life back daily through working from home. Perhaps more immediately important, the return to normal has been disrupted by a newer normal from the Russian invasion of Ukraine, and the worst thing you could possibly do amid the subsequent energy shock and gas price spike is to tell millions of people to jump back in their cars and sit in traffic five days a week.
Which begs the question of why the administration is stressing returning to the office right now. What do they know about the looming collapse of central business districts? About the erosion of municipal tax bases? About looming commercial real estate failures? And if this is part of their calculus, shouldn’t we be informed about it? And shouldn’t cities be given the opportunity to come up with some better solutions?
Biden has noted that the federal government would lead by example by going back to in-person office work, something that’s being negotiated workplace by workplace with unions like the American Federation of Government Employees, whose Council 238 just announced a return to the Environmental Protection Agency offices by May 2, with added safety features like handheld CO2 monitors to measure ventilation and mitigate any viral spread.
But most offices don’t have union protections, nor do they have air quality experts on staff. In all likelihood, they won’t be accorded these benefits. As long as the world isn’t sufficiently vaccinated, the probability of new variants emerging over the next year or so is probably pretty high. Forcing people back to offices without a concurrent investment in and commitment to better filtration adds needless risk, particularly for those who are immunocompromised but able to work.
Maintaining telework and even increasing options for it would be a strong part of any agenda to reduce fuel consumption and regain some semblance of energy security.
Meanwhile, office workers fortunate enough to perform their duties from home want to keep doing so, in my experience. One of the key findings in my feature story about why so many people are quitting their jobs is that many resignations stemmed from workers who wanted the flexibility to stay out of the office five days a week. Given the tight labor market, a blanket order telling workers to go back in would likely lead to a lot of labor churn, as workers reject the new terms. Even if companies wanted everyone to go back to the office, it’s unclear they could get them to do so.
And given $130-a-barrel oil, it’s extremely unclear that any public official should be endorsing more car usage—especially at a time when stressed mass-transit budgets have made it less possible to quickly get into many downtowns without driving. Returning to these commuting patterns are an option, not a necessity, and they’re certainly not something that any American relishes.
By contrast, maintaining telework and even increasing options for it would be a strong part of any agenda to reduce fuel consumption and regain some semblance of energy security. Even small reductions in demand when supply is constrained can ease prices, and it would also reduce congestion for those who don’t have the choice of not commuting, thereby benefiting almost everyone with some connection to downtown employment.
There are trade-offs with this idea, however. Lack of downtown traffic has hobbled business owners and their employees who used to serve the office workers grabbing lunches and doing errands. Probably of more importance to public officials, commercial real estate (CRE) owners are likely seeing considerable stress after two years of unoccupied office space.
Amazingly, we don’t know how much. Maybe it’s because companies have largely refused to pull the trigger on reducing their footprint yet. Maybe it’s because there just isn’t enough data to track the losses. Maybe it’s because CRE operates on a long time horizon of endless rollovers of mortgages, and there’s been a period of what in the financial crisis was called “extend and pretend.”
The fact that Vornado Realty Trust literally had to pay Facebook $150 million to close a deal on new office space in Manhattan suggests that there’s at least some trepidation that CRE will at best stagnate and at worst shrink in the coming years. That would mean a collapse in the tax base for cities, from both the real estate sector and the ancillary businesses. Some public officials are beginning to acknowledge this new reality (which doesn’t necessarily mean they’ve quantified the consequences). “It may never be a five-day week again,” Gov. Kathy Hochul (D-NY) said last week, reversing her previous exhortations to get New Yorkers back to the office.
City and state budgets were bolstered by the American Rescue Plan’s fiscal relief funds, but downtown downturns could create a structural deficit. The float from that funding, however, makes this a perfect time to at least think about reimagining downtown life with fewer offices. In a way, it’s a huge opportunity; a lot of idle office space could be converted through adaptive reuse into housing units that the same cities desperately need for affordability. New York City rents have started to surge again after some downward pressure in the pandemic; converting a bunch of empty and unnecessary offices into housing could be the perfect antidote.
Create enough new communities this way and you save the local businesses and get a whole new set of non-commuters grabbing lunches and running errands. And the rescue funds could serve as a down payment on the capital required to do this, which could be furthered by those commercial real estate operators switching to residential.
At a minimum, presidents, governors, and mayors sounding like a foreman yelling “back to work!” at their constituents is unsavory. In the current circumstance, it’s counterproductive. It also misses the potential real gains to quality of life by reimagining downtowns. Going back to normal isn’t something everyone wants, and right now it isn’t even going to happen. A new normal is possible, and desirable.
