The Future of Workplace Trends: How Will Larger Corporations Set Standards for Office Mandates?

Anyone following US politics over the past six months will be familiar with the phrase “we’re not going back”. The defiant campaign slogan for Kamala Harris’ ultimately doomed run for the presidency seemed to suggest that times had changed and the world was looking to move on. Turns out, America was going back.

Without wanting to dwell on the politics of the US presidential race, does the slogan’s failure to convince ordinary Americans to turn their back on the norms of years gone by reflect wider societal trends, in particular in the workplace? Weren’t we told that the Covid-pandemic-enforced remote work revolution was, in fact, the future of work? The snowballing number of return to office mandate announcements from major firms suggests that perhaps office workers may have jumped the gun.

The future of workplace trends is a much debated topic of discussion among business leaders, HR professionals and workforce analysts, primarily because we’re at a critical juncture in determining the direction of travel. The recent increase in companies enforcing staff to spend more time in office has led to significant changes in workplace dynamics, compelling an exploration of how these policies might influence office environments and employee morale.

Larger corporations, with their substantial influence, appear poised to establish the benchmark for office mandates, potentially leading to a more widespread long term return-to-office movement. But what are the driving forces behind such mandates and how will they impact on talent retention and recruitment strategies? As companies strive to balance organisational needs with evolving workforce expectations for remote work, understanding these dynamics is vital for fostering a productive and positive work environment, and for SMEs to find their own place in the food chain.

Why Are Companies Forcing Return to Office Mandates?

Motivations Behind Corporate Culture Shifts

The reasons driving companies to enforce return-to-work mandates are multifaceted. Primarily, the belief that in-person work enhances business productivity is prevalent. Many employers argue that spontaneous interactions and face-to-face collaboration lead to more innovative solutions and accelerated problem-solving. Additionally, there is a strong perception that physical presence in the office nurtures a cohesive corporate culture, strengthening relationships among colleagues and aligning individuals with a company’s mission.

Another significant consideration is the potential to optimise the use of commercial real estate, which remains a considerable expense for many corporations. By bringing employees back to the office, companies aim to justify these costs. Furthermore, there is concern about effectively managing and supporting employees, as some managers feel more confident leading when they can directly and frequently engage with their teams. Ultimately, these motivations intertwine with the desire to maintain control and oversight in a rapidly changing work environment.

The wider impact of fewer office workers commuting daily to their workplaces has naturally lead to lobbying from the firms previously sustained by the office worker economy and this too has contributed to efforts to stifle the remote working revolution. Famously, coffee and sandwich chain Pret a Manger saw such a sales slump in its previously prosperous city centre locations in the immediate aftermath of the pandemic lockdowns that it lent its name to the Pret Index, monitoring Pret sales in business districts measured against their pre pandemic figures. Spoiler alert: they weren’t great, though locations in the suburbs are flourishing.

Impact on Employee Morale and Productivity

The enforcement of return-to-work mandates can have diverse effects on employee morale and productivity. For some, the structured environment of an office enhances focus and efficiency, leading to improved performance. However, many employees have of course become accustomed to the flexibility of remote work, and all the work-life balance benefits it brings. Consequently, being forced back into an office setting tends to lead to reduced job satisfaction for these workers.

Then there’s the commute and the rigid schedules associated with in-office work which can diminish morale and increase stress levels, potentially leading to burnout. On the other hand, proponents argue that the office environment fosters a sense of community and belonging that can boost morale. Many younger workers in particular have found that fully remote working feels isolating and they actually miss the company culture of day to day in-person interactions with colleagues. Not to mention the fact that Gen Z staff are far less likely to have suitable dedicated workspace in the home they most likely share with either family or flatmates.

Nonetheless, the key surely lies in finding a balance; hybrid work models may offer a middle ground, allowing employees to enjoy both the advantages of in-person work and the flexibility of remote work, thereby maintaining high morale and productivity. But do employers agree?

Past and Future Workplace Dynamics

The long-term effects of return-to-work mandates on workplace dynamics are likely to be significant. These mandates could lead to a division within the workforce, distinguishing between those who thrive in an office environment and those who prefer the autonomy of remote work. This division might result in talent migration, with employees seeking employers who provide more flexible remote work policies.

It’s also pertinent to consider that non-customer-facing, back office staff working remotely can be eyed with contempt by those manning the warehouse or shop floor. It’s not unrelated that the likes of Amazon and Starbucks are among some of the most high profile companies to be upping their in-office requirements of staff. After all why does the accounts payable clerk get to enjoy the luxury of working metres from their bed, with no need to interact with other people, whilst the barista pumping out coffees can only do their job onsite with multiple daily human interactions?

This growing emphasis on in-person work may reshape recruitment strategies, as companies look to attract talent willing to commit to regular office attendance. Over time, this could influence the demographic composition of the workforce, potentially affecting diversity and inclusion initiatives in certain areas.

Workplace dynamics may also shift towards more hierarchical structures, as in-person mandates can reinforce top-down management styles. Conversely, organisations adopting hybrid models may cultivate a culture of trust and empowerment, enabling employees to manage their work time more independently.

Of course different businesses in different sectors have different ways of working, but sometimes dynamic firms in younger industries can influence the wider world of work. Consider that 20 years ago the majority of office roles would require staff to adhere to a relatively rigid dress code, whereas the new media and tech startup culture of dressing casually has since become more widely accepted across firms outside of the industries still most fiercely wedded to the suit and tie (think banker, estate agent or sales rep). In fact research suggests that only 7% of UK workers regularly wear business attire for work today.

Talent Retention and Recruitment Strategies

Balancing Flexibility and Corporate Needs

Talent retention and recruitment strategies rely on being able to provide staff with competitive pay, conditions and benefits. Companies are therefore recognising that offering a degree of flexibility is not just a perk but in many cases a necessity to attract and retain top talent. Why shouldn’t workers today value a work-life balance that allows them to seamlessly integrate their personal and professional responsibilities? Anyone who was in work in 2020/21 will have most likely had a taste of it and remote and hybrid work models had become central to many companies’ talent strategies in the pandemic’s aftermath.

However, businesses also need to ensure that their operational objectives are met. This requires setting clear expectations and performance metrics that can be achieved regardless of the work environment. For staff paid by the hour regardless of their output they could easily slack off more working from home than they might do in the office under supervision. It just goes to show the outdatedness of measuring performance by hours “worked” rather than output.

Forward thinking companies should be setting clearly defined goals and targets by which all staff can be measured, and may engage in a mix of flexible work hours or rotating office days to meet both employee desires and business productivity goals. Productivity should always be the measure and not hours of screen time.

The Role of Salary in Employee Decisions

Salary will always be a crucial factor in employee decisions regarding job offers and retention. While flexible work arrangements have gained prominence, compensation is most often the primary consideration for many employees when evaluating job opportunities. Some workers may be willing to accept lower salaries in exchange for remote work options that improve their work-life balance, particularly those raising a young family. Conversely, higher salaries may be necessary to attract talent to roles that require stricter in-office mandates.

For multinational giants, offering competitive salaries is vital, especially when competing with smaller firms that might offer more appealing remote work policies. However, organisations need to assess how much more they should offer to make in-office roles attractive. Understanding the sweet spot between salary and flexibility can significantly influence recruitment strategies. Though the number of firms that demand in office work will ultimately dictate how much opportunity exists for employees not keen on the traditional 9-5.

Much like shops can inflate prices when they’re confident nobody will undercut them, firms will be more confident requiring staff in-office more frequently, the more common it becomes. And at that point the need to offer increased salaries to remain competitive becomes less necessary. If we consider the “Big Four” accounting and auditing firms, it’s easy to imagine a world where one haemorrhages staff to a rival if they’re being considerably less flexible over their demands of staff, without hiking the compensation considerably. This may be why when looking at their in office requirements, each company has very similar policies as things stand.

You can see the currently agreed in-office demands of Deloitte, EY and KPMG in this list of major firms and their back to office strategies, whilst PwC’s requirements are outlined in a recent press release. As things stand there’s not too much to pick between them however PwC’s move from requiring a minimum of two days per week in office to three could upset some staff and push them to the potentially welcoming embrace of their competitors, unless of course they follow suit. PwC’s move essentially throws down the gauntlet to see whether their rivals follow suit or seek to benefit by being more flexible and poaching some of their top talent. Time will tell which direction Deloitte, EY and KPMG choose.

Do Hybrid Work Models Remain A Competitive Advantage?

We know that offering hybrid work models has been seen as a significant competitive advantage for companies in attracting and retaining talent. By offering a blend of in-person and remote work, businesses can cater to a diverse range of employee preferences whilst being seen as forward-thinking and adaptable.

Incorporating hybrid models also allows companies to tap into a broader talent pool, as geographic location becomes less of a barrier. Employees benefit from the opportunity to maintain personal commitments while still engaging in meaningful in-person interactions at the office which can foster a balanced work-life dynamic and result in higher engagement and productivity levels.

For firms in expensive cities like London, being able to recruit from further afield also allows for cost savings because employees working primarily remotely aren’t expected to commit to the extortionate cost of commuting in this country. If we take the classic commuter belt town of East Grinstead as an example, an annual rail season ticket to travel into central London five days per week comes in at over £3,300, meaning the salary offered needs to be significantly higher in order to offset this cost than if the employee could work from home at least some of the time. The idea of “London weighting” of salaries becomes less relevant if staff of London firms don’t need to be in London.

So in principle remote and hybrid workers can offer significant cost savings, particularly when combined with the reduction in costs related to facilities provided in order to house workers five days a week. Shouldn’t this be driving firms to embrace remote work further, not scaling back?

The Divide: Large Corporations vs. SMEs

Influence of Multinationals on Industry Norms

The big boys wield considerable influence in setting industry norms, including workplace trends and policies. The substantial resources of major multinationals and their global reach enable them to implement and propagate practices that smaller enterprises might emulate. When these large corporations mandate a return to the office, it can signal a shift that other businesses may wish to follow, less fearful that they risk losing staff as a result. After all if it’s accepted practice at the major firms, the arguments against in office mandates are harder to promote.

However, while multinationals can set trends, not all organisations will mirror their approach. Small and medium-sized enterprises (SMEs) often have the agility to offer more personalised and flexible work arrangements, leveraging this as a selling point in talent recruitment and retention. This flexibility will obviously be particularly attractive to employees seeking balance between professional responsibilities and personal life.

The influence of multinationals might lead to a bifurcation in work culture, with some industries adhering to traditional in-office models while others embrace hybrid or remote work environments. Consequently, this divergence could redefine industry standards, offering various pathways for companies to attract and retain talent based on their unique strengths.

Benefits of Remote Work for Smaller Firms

As well as being able to attract talent otherwise unenthused by being in a corporate office full or even part time, offering remote work also enables smaller firms to reduce overhead costs associated with maintaining large office spaces. Savings on commercial real estate can be redirected towards other strategic priorities, such as employee development or technology investments. Meanwhile recruitment efforts can extend beyond geographical boundaries, in order to access a wider pool of talent.

Additionally, as previously discussed, by enabling employees to work in environments where they feel most comfortable and focused there are often productivity gains to be found. This autonomy can lead to higher engagement and better performance outcomes. So embracing remote work should offer smaller firms a competitive edge in attracting and retaining skilled professionals while optimising operational efficiency.

The fear seems to be, certainly among the corporate behemoths, that counter to earlier data suggesting productivity improved as staff were allowed to work remotely, there is now evidence to suggest that not having staff back in the office leads to a reduction in performance instead. Of course you can cherrypick data to prove anything but there are credible sources to backup this theory. Ultimately however, everybody works differently and how you manage remote workers will determine how productive they are. Big companies find it harder to manage the needs of thousands of staff across multiple different departments and job roles which is why blanket policies are often implemented which just can’t suit everybody.

The SME by contrast can manage and monitor people working remotely more effectively and adjust as necessary. Many bosses of small businesses can quickly get an idea of how their team works best just by talking with them to find the optimal balance. This can help give them an edge with talent recruitment and retention as employees feel more valued and may even have a say in their own working patterns.

Future Trends in Workplace Policies

The future is likely to be shaped by a blend of flexibility and structure, as organisations continue to seek to align their operational needs with employee expectations. Hybrid work models aren’t going away, but they may become less flexible for a lot of companies. Meanwhile firms working with a fully remote workforce may find that the system has an upper limit on staff numbers, beyond which it’s unsustainable. More employees more problems.

Whether we start to see greater divergence in standard working practices between large corporations and SMEs will likely influence these trends. As multinationals drive overarching policy shifts, smaller firms can, and likely should, continue to innovate, providing flexible solutions that prioritise employee satisfaction and organisational agility.

It’s an interesting crossroads for the world of offices and how we fill them. But one thing we do know is that if you want somewhere you can base your company and welcome staff and clients, JetSpace’s serviced offices in Brighton and Shoreham offer the flexibility to choose working models that suit our business best!