More thoughts on remote work

August 28, 2023

What a great illustration of the perversion of capitalism: someone who owns two restaurants in downtown Minneapolis is asking Target to force thousands of employees to spend literal pieces of their lifespan every day (and polluting and adding to traffic and wearing down/depreciating their cars in the process) to return to office so that their restaurant business model continues to be profitable.

The remote work revolution is likely unstoppable: thanks to three years of lockdowns, workers now know that rote commuting is a waste of time. Flexible and remote work allows more work-life balance and costs everyone less to produce the same output.

The forces against remote work are almost entirely reactionary: a desire to return to the Old Ways, to Manage By Walking Around, to go back to the Old Business Models, to save Commercial Real Estate; in other words, to save old capital.

Just to be clear: workers who do remote work still spend money; they just spend it differently.

No one has a right to have their business model preserved. Just as coal miners have to move on when solar became cheaper than coal, small businesses who are dependent on workers commuting to a central office need to do something else, or go bankrupt. That’s how it works.

Interestingly, the remote work revolution highlights how broken US cities have become. The reason small business downtown suffer when workers don’t commute is because nobody lives near where they work. When commuting stops, downtowns turn into ghost towns.

Remote work shows that mixed-use, high density, walkable neighborhoods are once again the most resilient pattern for city-building, because people actually live there. They simply repurpose spaces to adapt to changing times.

Cities (and self-absorbed CEOs) are going to do their darndest to get people to commute daily again, but I suspect it’s not going to work. The moment the market tips in favor of the employee, I think you will see remote work become a primary factor when employees choose their next job.

I think the Commercial Real Estate apocalypse is inevitable, because there are enough employers (typically small to mid-sized companies) who do not have real estate investments, who will soak up workers when the fear of inflation lifts again. People will leave their jobs to reclaim their time. They will take a smaller salary and relocate to a more affordable city. Companies will eventually stop renewing their office leases because it’s cheaper to go remote.

City leaders can’t prevent CRE collapse by mandating commuting. Short of throwing bags of money (whose money?) at workers, all things being equal, people would prefer to have their lives back than commute.