You have to give it to major corporations, they are rather creative. This goes from financial institutions like Goldman Sachs all the way to mega-tech companies such as Apple.
All of this is about to put a damper on remote work.
Of late we are seeing many corporations starting with the workers must return to the office bit. This is being done by Tesla, Apple, and Goldman. It is very interesting considering the timing. Even Musk himself stated he believes we are heading towards a recession.
What is truly going on. One theory is we are about to witness what is being called "stealth layoffs".
Back To The Office Or Else
Basically workers are being given an ultimatum. But wait a second: aren't we told the labor market is strong. After all, this is what Jumpin' Jerome Powell espouse ad nauseum?
Why it most certainly is Boo Boo.
If the labor market is on fire, how can companies risk losing employees by pushing them back to the office? The answer to this question stems from the fact they want to lose these people.
Both Tesla and Goldman have admitted they went on a hiring spree the last couple years. For this reason, trimming the fat is required. This is especially true for Goldman which went crazy in this category.
These companies know that people are not about to return to the office. Many of them moved out of state. As Musk said, if you don't show up, they presume you quit.
Hence the "stealth layoffs".
What better way to cull the herd than to force people to return to work 5 days a week knowing many of them hundreds of miles away. The reality is many of these people are now done working at those corporations. Couple this with a real estate market that is tightening and there is no way to unload the new home that was just purchased.
Is This The End Of Remote Work?
Some are questioning whether this will be a hindrance to the remote work movement. Certainly, it could be a temporary blip as the power in the labor market shifts. If layoffs are going to start mounting, which many believe is the case, we could see the balance placed in the hands of employers.
This will be, of course, short lived. At some point, when coming out of a recession, we are going to see the need for labor expansion occur. Here is where things might swing the other way.
Another thing to keep in mind is the disruption that is often caused by recessions. The leaders going into the economic downturn might not be that way coming out. It is unlikely that Apple, Tesla, or Goldman lose their respective places. Other companies might not be so lucky.
We are undergoing a multi-year struggle for power in the labor market. It is unclear who is going to truly win this one.
For the workers, demographics are in their favor. The Baby Boomers are rapidly reaching retirement age with many of them looking to exit. This is going to bode well for GenX and the Millennials.
On the other end of the spectrum is technology which favors the employers. Over time, advancements are made which allow them to automate more aspects of the workforce. This could cut into their hiring.
In the end, we are going to see pockets were both sides win (or lose). Some industries will be skewed towards the employees while other see the exact opposite.
It is going to be an interesting 3 years.
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I’m fascinated by this struggle. I’d think it would be cheaper for companies to maintain remote work, but I also see that people who don’t “report” to work tend to realize they aren’t property of their employers… which is quite different than the world I grew up in.
No doubt companies see that, too. I’d like to think the average Joe will win this round, since we’ve more or less been enslaved SPT decades+, but the empire always wins… until it doesn’t, of course, but losses seem few and far between.
Even cheaper to get rid of the excess. Many companies over hired during the COVID situation and now are realizing they have to cut.
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This has been intensifying of late. But the interesting or unpleasant part of this story is that it is just the start of it, so who knows if it could trigger a domino effect.
Your analysis makes a lot of sense.
In my view, the best balance between working remotely and at the office is to work remotely on most days while showing up at the office regularly to maintain a connection between team members. Forcing people to work at the office every single day is a massive waste of everyone's money and time including that of the employer.
I am interested in seeing how things play out but I think remote work will win out because I think technology such as VR can help ease the experience and provide a similar environment.
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Tech will certainly change things in favor of remote work I believe.
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The major issue in this struggle is whether the technology will offset long-term demographic trends. As times go by, there is less and less babies being born and, consequently, less workers competing for the same job. Due to such demographic trends spreading globally, employers won't be even able to count on immigration as solution that problem.
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