Working from Home - Good or bad for North Devon businesses? - Tim Jones

Who could have imagined just three years ago that the world of work could be turned on its head? That, too often, grinding regime of being a commuter was embedded in our DNA.

There was no other thinkable solution. This is something we took for granted and, along with others, either suffered or tolerated the experience of travelling, parking and then accessing work space, only to repeat the experience at the end of the day. Suddenly all of that stopped. Covid has been responsible for a lot of terrible things. For many however being released from this mouse wheel was a blessed relief.

The brilliance of our scientists and communication experts immediately plugged the gap. We all adapted to, or had to learn quickly, the use of remote communication. We have become familiar with “Teams” and “Zoom” and many other video applications. This has enabled us to maintain a high degree of business engagement. Many would argue that it has been beneficial to their work/ life balance. It has allowed a more civilised relationship to develop with family and friends. It also engendered a more relaxed attitude without the stresses and strains of making yet another journey.

There has also been a significant financial benefit from this. Many, particularly those in rural areas, have no option but to use a car. Fuel prices, as we all know, have spiralled out of control. It is only recently that some sanity has re-emerged in this volatile market but there is still a big price to pay for fuelling the car. The vast majority of those working in Northern Devon do not have the alternative of different forms of transport. Much as we have an excellent rail link and local bus service, this is never going to be a substitute for the demands of attending a workplace.

In 10 years’, time, we will still be debating as to whether this new way of working has been a liberating and economically productive process or not. What however is beginning to emerge is a more balanced and rational approach to this whole topic. For many employees, the option of home working is simply not practical. Those in manufacturing or direct service delivery do not have a choice. The work which has been most affected by this is across a wide range of office-based businesses and service providers.

At its peak, home working was hugely popular. Many regarded their new regime as requiring only to attend the office or workplace once or twice a month. Many employers adapted to this, and conference calls and strategic directions were routinely delivered remotely. There were a number who were highly uncomfortable with this. Losing physical contact with your colleagues can be a difficult experience. Many people rely upon human interaction to bounce ideas around and generate creative thinking or problem solving.

Trying to transfer these skills onto a remote screen is difficult for some. The new normal is hybrid working, which most popularly is attendance at the workplace on Tuesday, Wednesday and Thursday and home working on Monday and Friday. Whether business bosses like this or not, it has been adopted as a good way for the future. There is no doubt that the shortage of employees generally has given many employees a lot more muscle power in negotiating favourable terms, such as this.

This practice has had many implications outside the workplace. Working from home has changed the routine in respect of local services, particularly convenience shops and restaurants in Town Centres. They have taken a serious downturn because of this. Examples from one of the most effected areas being the City of London, show that local fast food/ takeaway restaurants had experienced a 90% reduction in their turnovers.

The latest evidence however suggests that a more settled pattern is emerging. Arguably, central London offices have been those most badly effected by this. However, since early February this year there is evidence that workers are returning to their offices in Central London.

The average daily demand on the London Underground has now risen to around 82% of pre-pandemic levels and demand on bus services has increased to around 84% of pre-pandemic levels. Perhaps predictably, demand for green travel has increased.

Cycling now exceeds pre-pandemic levels of demand by 140%. There are several reasons for this shift in sentiment. One of the Banks has recently completed a survey which found that nearly 30% of their workforce were simply bored working from home and wanted to get back into closer contact with face-to-face business transactions and the general boost arising from sharing problems with colleagues. Some of the return to work has been stimulated by employer incentives, for example, to try and lure staff back into their City Centre offices, PWC Accountants are offering a £1,000 payment.

Some employers are taking a more aggressive approach, for example, one of the major insurance companies is insisting that staff attend at least 3 days per week. Some are making office premises and facilities a lot more attractive to create a better environment for their employees. An insurance company, who have a vast campus on the edge of Birmingham, now provide accessories for their whole workforce including golf putting greens, tennis courts and free staff restaurant.

Not everyone has adopted a similar strategy. In the US, Meta with its Facebook division allow their teams to work from home permanently but require them to attend occasional week-long off site intensive top-up sessions at a luxury hotel.

Other problems which have been identified are particularly those in respect of younger workers who need more direction and training and the ability to draw on the experience of more senior staff. There is no doubt that mental health issues are now being taken a lot more seriously.

So, what does all this mean for Northern Devon? We have not seen anything like the negative impact that has been experienced in big City Centres, which rely on large numbers of office workers in close proximity. Our businesses are more dispersed. Perhaps, if anything, Northern Devon has the potential to benefit from these new trends. The technology now available for video conferencing etc is so efficient that it is possible to conduct national/ international business from the most rural locations.

There is also good evidence that many of those who have escaped from their “handcuffs” of commuting and City life, to take up permanent residence in North Devon are beginning to have a beneficial impact on our economic outputs. We should not forget that a number of our Town Centre restaurants are suffering from lower turnovers, as are some of our High Street shops.

This however is not just to do with remote working, it is a complex cocktail of reasons, including higher interest rates and the effect of these on disposable income, the higher costs of travel and energy and the increasing influence of online sales which are now hovering at 30% of all retail sales.

My predications are that the world of remote working is now here to stay. It will include a smallish percentage of those who will just work from home all the time. By far the largest percentage however, in my view, will be those who adopt the hybrid solution probably at their workplace on Tuesdays, Wednesday and Thursday. The business community and its service providers will need to make necessary adjustments for this change. Like it or not, I believe it is here to stay.