Welcome to WorkplaceBytes – October 2024, a rundown of articles and reports on the future of work, office occupancy trends, and how workplace leaders like you are blazing new trails as teams adjust to the new workplace.
Here are this month’s top stories:
- According to a study conducted by Harvard Business Review, hybrid work rules continue to dominate. The study also showed that hybrid improves work-life balance, recruitment, and job satisfaction.
- Small office spaces like two-person meeting areas and phone booths as well as dedicated ‘quiet zones’ are increasingly popular elements of modern workplace design as workers struggle for productivity in busier offices. Understanding usage patterns for these spaces is now an important part of workplace data strategy.
- Interest in workplace air quality has grown worldwide, and multiple studies show ROI benefits to monitoring and improving indoor air. Bonus: watch our recent air quality webinar featuring Stanton Wong, President of RESET.
- For younger workers, sustainability has become a top concern, with a major Deloitte study reporting that a company’s sustainability affects their employment decisions.
- Demand for prime office space is a bright spot in the CRE industry, according to new insights from CBRE.
Let’s dig in.
The state of hybrid work
Hybrid is here to stay
A few large companies, like Amazon, continue to pursue five-days-in-office policies. CEO Andy Jassy announced a full return-to-office mandate in his recent message to employees. But, a survey by the job site Blind found that 91% of employees were dissatisfied with the policy, and 73% were now considering quitting.
Harvard Business Review recently conducted an A/B test of 1,600 employees, with half working in the office full time and half working as a hybrid model. Managers predicted a decrease in productivity by 2.6%. Instead, results showed those working under the hybrid model had equal or increased level of productivity, a higher satisfaction rate, and 35% lower attrition.
While there are challenges for businesses to overcome to maintain collaboration and company culture in a hybrid setting, the hybrid model offers the flexibility employees desire while still facilitating essential in-person interactions that contribute to team cohesion.
Better outcomes from hybrid workplaces
The team at Robert Half published a smart summary of ways to make Hybrid deliver better business outcomes. The piece emphasized that managers must take a stronger interest in employee career goals and well-being and proactively manage policies and behaviors that create greater connectedness for each team member.
Training Magazine offered a feature on how to adapt leadership style for hybrid workplaces. The perspective recommended:
- Establishing clearer communication channels and protocols
- Creating stronger team dynamics through team-building exercises and open dialogue
- Promoting equity and inclusivity
- Expressing professional trust and flexibility about how and where employees do their jobs
- Continuous evaluation and refinement of workstyle/leadership style.
Survey: <20% of workers prefer all-remote working
For most workers, hybrid seems to be the preferred way of working. New research from Lincoln Property Group shows that only 16% of workers want an all-remote work schedule.
The group least enamored by all remote work? Gen Z.
Cushman and Wakefield has just issued a “Sustainability Megatrends” report underscoring the importance of responsible workplace practices for the future of commercial real estate. Among the key trends they identified was the digital transformation of offices through more and better performance data and AI. XY Sense has been at the forefront of leveraging data to enhance work environments while reducing carbon footprints.
The fight for focus areas as RTO ramps up
Recently, several press articles have documented the growth in popularity of small meeting spaces and telephone booths to hold private meetings and conversations. Other stories have heralded the rise of focus areas, where companies allocate office space to quiet, no-conversation zones.
This FT article discusses the reasons why offices now offer so many single-person pods:
- Increased noise levels on in-office days
- Increased expectations for privacy
- The desire for workspace flexibility
These three forces have fomented rapid growth trends for small, enclosed workspaces.
Small spaces have created significant measurement challenges for companies seeking accurate data or resource utilization. These facilities are integral to workplace measurement in the hybrid office, but portable units cannot be equipped with wired sensors. Additionally, the cost of wired sensors can be too high to justify for small space measurement.
To help address this challenge, XY Sense has just introduced Presence sensors, low-cost units that can be quickly attached to the ceilings of small spaces with adhesive and that do not require a wired power source. Presence sensors offer real-time binary occupied/unoccupied status data automatically integrated into the XY Sense Analytics Suite. Get more information on this approach on our website.
Office design trends favor tech, focus areas, privacy
A new JLL report on US and Canadian office and design trends lists several broad trends worthy of note:
Human-led design principles are favoring collaboration spaces that:
- Seamlessly connect in-office and at-home staff
- Incorporate more technology to enhance productivity and eliminate wasted time
- Provide focus areas in which solo work can be done free of more distractions than traditional desk and cube farms
The need for a greater range of space types adds complexity to the challenges of workplace leaders. This underscores the need for the most accurate workplace and resource utilization data so that these teams can make the best decisions and boost ROI.
Changing your IAQ mindset
Many recent business press and CRE trade journal articles have discussed the importance of indoor air quality (IAQ).
Buildings Magazine published a thought-provoking perspective on how companies must change their IAQ mindset. The article says many consider IAQ a regional issue–primarily in developing countries like India and China. However, less than 1% of people on earth breathe air that meets WHO standards. 7M+ people die yearly because of poor air quality, and indoor air quality is often worse than outdoor air. In 2024, bad indoor air quality will affect the health and well-being of more people than malaria, HIV, drugs, alcohol, and even war, according to The Lancet.
The Buildings Magazine article made four recommendations to help businesses take a more proactive approach to IAQ:
- Get aligned with your team. Understand that IAQ is not the sole responsibility of the building engineers or facility managers.
- Structure your budget correctly. Make separate budgets for IAQ monitoring and improvement. Ensure you collect IAQ data and act upon it.
- Don’t treat IAQ as an afterthought. Strategically prioritize and budget for IAQ early on.
- Create a data strategy. Install monitors and ensure you have the time, expertise, and technology to help you get the most out of your data.
IAQ spells ROI
A recent Propmodo article underscored the growing pressure on building managers to improve air quality. The article cites a Harvard study showing that spending $40 per employee on IAQ can reap annual productivity benefits of up to $7,000 per employee.
Research from the Confederation of British Industry, an organization analogous to the US Chamber of Commerce, reported:
Improving office air quality can generate significant benefits for individuals, boosting London employees’ productivity by up to 15%. In monetary terms, this translates to an additional £17,400 of output per worker. The health and productivity benefits can also lead to overall improvements in employee wellbeing and earnings potential, highlighting the importance of a healthy work environment. For businesses, reduced absences from work and increased employee productivity and wellbeing can also translate to increased innovation, staff retention and ultimately higher revenues. Improving air quality in the workplace can therefore be a worthwhile endeavour as part of broader plans to create a healthy office environment, particularly if staff are to be convinced to forego home working in favour of returning to the office.
They also published data for a range of global cities showing the percentage increases in worker output and the total economic gains from improving air quality.
A US study found that visible efforts to improve air quality were linked to higher employee job satisfaction. Employees also want transparency about IAQ. 97% of Canadians and 84% of Americans strongly desire ongoing updates and visible evidence of IAQ improvements.
Watch Webinar: The Future of Workplace Air Quality & Occupancy
Did you miss our recent live webinar with industry experts discussing the vital role of air quality in the modern workplace?
You can still catch up!
Watch the on-demand recording of “The Future of Workplace Air Quality & Occupancy” featuring Stanton Wong, President of RESET, alongside Alex Birch, CEO of XY Sense, and Shivaun Ryan, Global Head of Customer Success at XY Sense.
In this session, we examine global trends in office air quality, its impact on employee productivity and building performance, and the unique advantages of XY Sense’s new Air Quality sensor integrations.
Sustainability a top concern for younger workers
Deloitte’s new 2024 Gen Z and Millennial Survey is loaded with data on the importance of workplace sustainability to these groups. More than a quarter say they have researched companies’ sustainability policies before accepting a job, while an even larger percentage say they plan to in the future. Further, about half of each group report they and their colleagues are putting pressure on employers to improve sustainability.
When asked what actions they’d like their companies to take to improve sustainability, the top answers were greater employee education, sustainability subsidies, and updating workplaces to make them more sustainable.
The market is choosing prime space
CBRE research shows that many companies are choosing prime office buildings and spaces. Using a dataset of highly desired prime office buildings representing 8% of total U.S. office space by square footage and 2% by building count, they compared occupancy and absorption rates to non-prime real estate. They found that prime vacancy was 14.8% in Q1 2024 for prime versus 19.3% for non-prime. Net absorption of 49M square feet compared to negative absorption of 170M square feet. These strong results were despite an 84% rent premium.
Their analysis predicts that prime vacancies will drop to pre-pandemic rates by 2027, reflecting the long-term trend toward better spaces in preferred locations.
Workplace teams are driving corporate strategy
CBRE published an excellent perspective on the changing role of CRE and workplace teams in corporate strategy development and implementation. According to Designing the Optimal Organization, “CRE has emerged as a strategic partner supporting business goals, prompting organizations to reevaluate the structure of their CRE functions in light of hybrid work, technology integration, and workplace wellness.” According to the article, the role of the workplace is increasingly recognized as integral to:
- Strategic Alignment for Growth: Integrating real estate decisions with broader business objectives can fuel expansion, optimize location choices, and strengthen competitive positioning.
- Elevating the Employee Experience: Collaborating with HR allows CRE teams to create workplaces that attract and retain top talent, fostering a thriving and engaged workforce.
- Embracing Technological Advancement: By integrating smart building technologies and data analytics, CRE teams can optimize operations, enhance efficiency, and make informed decisions based on real-time insights.
- Championing Sustainability: CRE plays a crucial role in reducing environmental impact, achieving green certifications, and supporting the organization’s commitment to corporate social responsibility.
It’s a great read for those looking to expand the role and influence workplace teams have with executive leadership.
That’s it for this month’s edition of WorkplaceBytes. We hope you enjoyed the read.
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