By Jon Swartz
MarketWatch photo illustration/iStockphoto
If you rebuild the workplace after COVID-19, will the workers ever come back?
In Silicon Valley, the answer from many tech companies is that many won’t, and maybe that’s a good thing.
In recent days, Twitter Inc. /zigman2/quotes/203180645/composite TWTR +4.52% has said that employees have the option of never coming back to the office to work , while Facebook Inc. /zigman2/quotes/205064656/composite FB +1.68% , Google parent Alphabet Inc. /zigman2/quotes/202490156/composite GOOGL +0.47% /zigman2/quotes/205453964/composite GOOG +0.71% , Salesforce.com Inc. /zigman2/quotes/200515854/composite CRM +0.15% and Slack Technologies Inc. /zigman2/quotes/212180539/composite WORK +0.46% have said they don’t expect workers back in the office until 2021 — if then.
That just may be the beginning: At least six prominent tech companies are considering permanently moving a large slice of their workforces to work-from-home status, their chief executives told MarketWatch this week.
“It’s hard to not see 20% to 40% of our workforce be remote,” Slack CEO Stewart Butterfield told MarketWatch in an interview Thursday on — appropriately enough — a Zoom /zigman2/quotes/211319643/composite ZM -3.24% video call.
“We need to make real-estate decisions long in advance, two to three years, and are in the speculative conversation now if we have 30%, 40% fewer desks,” Butterfield said in discussing conversations he was having with fellow Slack executives this week. “We may make the office more of a hotel.”
Don’t miss: Companies reveal their plans for what work will look like when America returns to the office
The COVID-19 pandemic forcing those who could work from home to do so has led to a surprising result — improved productivity. U.S. workers were 47% more productive in March and April than in the same two months a year ago through cloud-based business tools, chat applications and email, according to an analysis of 100 million data points from 30,000 Americans by workplace-monitoring company Prodoscore.
“I was pretty wrong about this. I thought productivity was going to plunge, but it has been very good,” Okta Inc. CEO Todd McKinnon /zigman2/quotes/210420951/composite OKTA -1.88% added, as the company considers a new dynamic work initiative. He said he could see Okta following Twitter’s path “until there is a vaccine or a treatment.”
As small businesses and nonessential services slowly begin to reopen, tech CEOs like Butterfield and McKinnon /zigman2/quotes/210420951/composite OKTA -1.88% are in internal discussions about fundamental changes to their workforces with far-reaching social implications. Not only are they open to letting a majority of employees work remotely; they’re vastly scaling back travel and attendance at conferences, hiring talent from all parts of the country, reducing office space and using the office as a place to socialize as much as work.
The financial impact on cities like San Francisco and Seattle, where tech is the chief economic engine, could be devastating. Use of commercial real estate and public transit are likely to decline. Restaurants, bars and other gathering spots could be endangered. And then there is the toll on workers, many of whom feel increasingly isolated and stressed, worried about the security of their jobs even as they log long shifts at home.
But that is the collateral damage from a new workforce that could also save companies billions of dollars in operational costs; greatly reduce traffic and liability related to sick employees; and enhance productivity from a workforce that eats, sleeps and lives at its diffuse, de facto offices. Tech is uniquely positioned to take advantage of working conditions turned upside down and sideways because it has the technical resources to support a decentralized workforce, and a significant slice of its employees already worked remotely.
In a free-wheeling “virtual dinner” this week attended by five software CEOs — McKinnon, Box Inc.’s /zigman2/quotes/208773138/composite BOX +0.28% Aaron Levie, PagerDuty Inc.’s /zigman2/quotes/210571191/composite PD +0.85% Jennifer Tejada, Twilio Inc.’s /zigman2/quotes/205796518/composite TWLO -2.88% Jeff Lawson and Zuora Inc.’s /zigman2/quotes/203058166/composite ZUO +0.84% Tien Tzuo — the topic elicited the most animated conversation.
See also: Twitter employees can work from home as long as they wish
“Twitter will cause a snowball of other organizations going forward,” said Levie, who has weaned on the management style of former Intel Corp. /zigman2/quotes/203649727/composite INTC -0.15% CEO Andy Grove, who weaved through offices to get an up-close look at workers. “We may not go back to work the same way [at Box]. Things are faster, more action-oriented with remote workers. With videoconferencing, I can check in on customers in the U.S., Japan and Europe in one day.”