Realist, not conformist analysis of the latest financial, business and political news

The Post-Covid World. Pt 2: Commuting

From our Swindon correspondent:

This is one of the bigger ones, although I have to watch my own biases here.

Changes in the way that offices work tend to move quite slowly, and they tend to start from startups and gradually get adopted by larger companies. Large companies are more risk averse because managers are covering their arse, following what is “normal” and there’s generally plenty of cash sloshing around. Startups are tighter on money and looking for how to not spend it. They’ll take more risks. They are incentivised to save money in a bigger way.

So startups have tended to be more accepting of people working from home. There’s benefits for startups. If you only have a few people using the office each day, you don’t need a lot of office space.

This also has effects on where your office has to be. Companies are often clustered. Computer companies in Silicon Valley, movie studios in Hollywood, Companies move there because that’s where the specialists are. But that also means that the specialists then move there because that;s where the companies are. There’s a large cluster of software companies in this country around Reading for this reason. It’s also meant that people trying to hire people to create software companies in say, Exeter, struggle to find people because they have less choice. People don’t want to be living in Exeter, find themselves unemployed and have to move for work.

But if you only expect people to come into the office once a fortnight, maybe someone in Swindon is OK with the 2 hour fortnightly trip to Exeter, especially they have 0 travel the rest of the time. So, a company can function in a much cheaper city like Exeter.

Startups and other employers have been doing this for some time. I had a client over in rural Cambridgeshire. Long trek but it didn’t matter. Many employers have been scared to try the remote work thing. The Covid-19 situation has forced them to try it. Many might find it’s sub-optimal for various reasons, but many will find that it works out well for them.

It seems to me that this could have a “rebalancing” effect on the economy. Location will still matter. No-one wants to fly down from Inverness to Bristol every fortnight. But, if location matters less, maybe it will help to spread the work around more.

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Bloke in North Dorset
Bloke in North Dorset
1 year ago

There’s no doubt there’s going to be a bottom-up push for more acceptance of home working by those who have found it agreeable, as well as a top down one. But it isn’t for everyone, even in a business that doesn’t need people in the office. I started working from home in the mid ’90s and got on with it straight away. It fitted well with the job which required 3-4 weeks overseas on client’s sites followed by 2-3 weeks back in UK. As we grew the business we found that not everyone who applied for jobs liked that idea,… Read more »

Bloke on M4
Bloke on M4
1 year ago

Yes, I think you’re right. It isn’t for everyone.

Personally, I find the social thing of work odd nowadays. People seem to travel so much and change jobs so much that you don’t get it. Most of my socialising is outside of work, not in.

Bernie G.
Bernie G.
1 year ago

@Bloke on M4… I once worked for an old fashioned Fezziwig-type family firm that set great store in the camaraderie among their workforce. Yes it was just a job – paid the rent and put food on the table. But it was also something you felt part of and belonged to, not dissimilar to serving in an armed forces unit. Over time the various support services, from cleaning and catering, bookkeeping and accountancy, were outsourced, ceased being part of the family, and people became more easily disposed of. Working from home, losing day to day contact, strikes me as an… Read more »

Bloke on M4
Bloke on M4
1 year ago
Reply to  Bernie G.

There’s definitely been a change since the mid-80s when I started work. There used to be the two-way thing of company loyalty and people rarely travelled far to work. So, you’d get drinks after work, weekend BBQs in the summer.

I learnt some time ago that you have to get a social life outside of work. Find a hobby, club.

Bernie G.
Bernie G.
1 year ago
Reply to  Bloke on M4

You’re right of course. Times change. Even my old gang eventually broke up – boy band that had been together too long. 20yrs on some of us continue to exchange emails…keep in touch. One or more turn up at the front door periodically with a bottle in their hand.

Quentin Vole
Quentin Vole
1 year ago

Very good article (i.e. it reflects my own views every well). I always expect some push-back when I suggest working from home to my clients. Salesmen (it’s usually men) in particular are dead set on face-to-face. I can see the advantage of the personal contact, but I wonder (never having been in Sales) whether a dozen contacts a day ‘virtually’ might not be more productive than a couple of face-to-face meetings.

Bernie G.
Bernie G.
1 year ago
Reply to  Quentin Vole

Never.

Bernie G.
Bernie G.
1 year ago
Reply to  Quentin Vole

I’m missing something here. You may be right in your assessment, I’ve been out of the game for a while so you’ll have to bear with me. I was good at my job; so too were my competitors. Given each of our respective products/services were broadly comparable and similar in cost, the only thing that differentiated us was whether my face fitted or yours – whether you are the sort of lad the customer feels comfortable sharing a pint with. Not sure that sort of relationship develops via the medium of a virtual experience.

Spike
Spike
1 year ago
Reply to  Bernie G.

That makes it sound frivolous! What he wants from the rep is not someone to share a pint with, but a person he can contact without awkwardness or pushback when the product fails. But yes, face-to-face is the only way you convey that you’re this sort of guy.

Bernie G.
Bernie G.
1 year ago
Reply to  Spike

“Without awkwardness or pushback when the product fails.”

I recall one client (VP international oil co) whose response to my pitch – and it was not unique – was along the lines that “You screw up once and you’ll never hear the end of it (perhaps a little more colourful); do it a second time and you’re finished in this industry.” Ah the good old days.

Spike
Spike
1 year ago
Reply to  Bernie G.

The purpose of that FACE-TO-FACE dialogue was not to instill fear but to establish that the client had a responsible individual in the event of a screw-up.

The modern NON-FACE-TO-FACE alternative is text on a website that complaints will be attentively listened to (presumably at a Pakistani help desk). And the result of that is No Sale.

Bloke on M4
Bloke on M4
1 year ago
Reply to  Quentin Vole

I still think that’s one area that you need some face-to-face sometimes. Like, if possible, I prefer to demonstrate work to people face-to-face.

Quentin Vole
Quentin Vole
1 year ago
Reply to  Bloke on M4

Sure – there’s a whole spectrum of jobs. People reading out a script in a call centre have no need to be physically in place A rather than place B. Plumbers are never going to fix a leak over Skype. Most jobs are somewhere in between. But when Covid is a distant memory, there’s going to be significantly less people commuting 5 days a week to work at a desk 9 to 5. Even after economic activity has recovered (however long that may take) rail and road passenger traffic will drop by at least 10% – but I can easily… Read more »

Michael van der Riet
Michael van der Riet
1 year ago

TANSTAAFL. As well as savings and efficiencies, there are costs and inefficiencies related to working from home. JK Rowling can do it. The forklift driver can’t. A whole generation of women wearing ill-fitting underwear can testify that not all sales can successfully migrate online.

Bloke on M4
Bloke on M4
1 year ago

Absolutely right. But fork lift drivers are rarely commuting. Factories and distribution centres are situated in cheaper places and the people working there live locally.

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