Mayor London Breed said Friday she’s collaborating on a plan with business leaders to bring back workers to the city’s downtown core sometime in March. But even as political and business leaders insist that a return to in-office work is essential to San Francisco’s economy, it is unclear if rank-and-file tech workers—or even the decision-makers in the C-suite—feel the same.
In comments made during a San Francisco Business Times economic forecast event, Breed said she was working with the San Francisco Chamber of Commerce to target a specific date next month where workers would be encouraged to return, as well as specified in-office dates for employers utilizing a hybrid work structure. No additional details on a specific date or timetable were given.
“Just like the Warriors, there’s strength in numbers,” Breed said, according to the Business Times. “So if one company is coming back this day, one company’s coming back another day, what is that going to do for the overall feeling of downtown and our recovery?"
Breed said the city is asking its own remote workers to return to the office next month and work at least two days in the office.
“San Francisco's downtown is the economic core of our city and its vibrance is key to the economic recovery. We are eager to work with our member businesses and Mayor Breed to bring San Franciscans and Bay Area residents back to the office to reinvigorate a neighborhood that has suffered during the pandemic,” Chamber of Commerce President Rodney Fong said in a statement.
The reasons behind the move are clear. According to the most recent version of the back-to-work barometer from key card company Kastle Systems, average office occupancy in San Francisco currently sits at 24.7%, below peer cities like Chicago, New York and Los Angeles, and less than half the numbers seen in Austin and Houston.
That staggered return has had a number of downstream economic effects, according to Ted Egan, the city’s chief economist. These include less spending from office workers to support the businesses downtown, as well as the operations to run downtown offices themselves, including the supply chain around building maintenance, office supplies and furniture.
Nate Haas, the owner of Moe Greens cannabis dispensary and lounge in Mid-Market, has seen his customer base shrivel up over the course of the pandemic. But he’s optimistic for a forthcoming resurgence as the indoor mask mandate and other Covid restrictions lift.
“I’m hopeful that some of the large employers will start to bring back their workforce whether’s that 20%, 40% or 80%. That would be a huge boost not just to us, but the bars and restaurants down the street too,” Haas said.
San Francisco’s sales tax revenue is down over the past two years in contrast to nearly every other county in California, Egan said.
The city is seeing average commercial vacancies of 22% and the second-slowest recovery in leasing activity in the country, behind Chicago, according to data from the Building Owners and Managers Association
According to the Office of the Controller’s Five-Year Financial Plan released last month, the city projects telecommuting will stabilize for the long term in 2023 and a 15% reduction in payroll and associated taxes because of the trend.
“We’ve got a continuing rise in office vacancy rates,” Egan said. “That, along with people staying away from the offices they have leased, are the things that are really going to hurt our business tax revenue.”
Some signals from major San Francisco employers have been positive. Last week, Wells Fargo announced its employees would be returning to the office March 14 under a “hybrid flexible model.” Facebook aims to bring its workforce back to the office on March 28, with boosters required for eligible employees.
A March return date, however, may not be the preferred timeline for either the city’s base of tech workers—who have grown accustomed to a remote working environment—or employers who have already delayed back-to-office plans multiple times due to unpredictable Covid surges.
A survey of 5,680 tech employees from Blind found that among respondents not satisfied with their company’s work from home or hybrid policies, 66% said they wanted to leave their employer.
Representatives from Google and Uber told The Standard that have not announced a target for returning to the office on account of the Omicron wave. Some companies like Airbnb and Lyft have also pushed their return dates further afield, and are now saying they won’t be back in the office until September and January 2023, respectively.
Then there are the companies that have announced plans for in-office work to be fully optional, like accounting firm PricewaterhouseCoopers LLP, which has 1,700 San Francisco staffers, and Twitter, which has 2,500 employees based in the city.
Salesforce, which is ranked as San Francisco’s top private employer with more than 10,000 workers based in the city, has announced that it is forever embracing a hybrid work structure.
CEO Mark Benioff, previously one of the strongest proponents of in-person work has softened his stance in recent months citing an increased level of productivity in the new work environment.
“I'm sorry to all my friends, but we're not all going back,” Benioff said during an on-stage interview in September at the Code Conference.
The company recently unveiled what it’s calling Trailblazer Ranch, an employee retreat on 75 acres of land in Scotts Valley that is meant to establish an in-person meeting space for the company’s workers and a way to engage employees in lieu of an in-office work culture.
Kevin Truong can be reached at [email protected]