In December of 2021, I wrote an article about working where you want to work, not where your company physically exists. Now, in January 2023, let us revisit the topic.
First, do you have to live where you work? Elon Musk may have ordered the Tesla and the Twitter workers back to the office, but did he tell all his employees that the jobs have been 100 percent reverted to 2019? I doubt it.
Elon Musk is also reducing staff. Amazon is reducing its staff by 4 percent from its 1.5 million workers after hiring freezes and staff redeployment in the Fall of 2022. Amazon admits to overbuilding staff, believing that the online market might stay at Pandemic levels. Meta is reducing staff by 13 percent, or approximately 11,000 employees.
I have not found one oil and gas concern that insists on all the old ways. If your child is sick, you can work from home for a few days, and the employee does not have to take a paid time off (PTO) day. Technology knows when you are in attendance and working versus when you are not.
If my readers have followed my articles for the past few years, I remind you to hire quality. Less is still more. Pay better, provide great benefits, and retain your best employees.
Did you read that oil and gas concerns are not ramping up hiring? That they are using their cash flow to pay off debt? Interest rates are on the rise. When I graduated from UT Austin a long time ago, the interest rate on a new home for a first-time borrower was 18 percent! Interest rates could be worse.
Will the new Congress help to lower inflation and interest rates? Oh, to have a crystal ball.
In December 2021, I asked why nongovernment and governmental concerns keep building office space. Now in January of 2023, I am still asking the same question. Folks, did you read about the Exxon complex in Houston? Did you read about the Facebook/Meta office space in Austin?
Exxon’s complex in Houston is less than half utilized. Does everyone with a title need their own office? Exxon is contemplating leasing some of its 385-acre complex in Spring, Texas. The Wall Street Journal wrote in November 2022 that 8.9 million square feet of office space need to be subleased. Remember those outrageous rental prices for office space in the Permian?
Heed my warning on this one, and if you want to keep the Permian growing in the right direction, then the Permian real estate prices need to beat all that available space in Houston. Given a choice, what would your family choose, the Houston area or the Permian? The joke about flying your wife into town after dark is still prevalent. I have worn out more than one pair of shoes, and 18-plus years later, I am still here. I am not sure if I am the rule or the exception.
Other large companies are strategically relocating their staff and offices as well. Yes, many are coming to Texas, and our available commercial real estate space needs to keep up. Granted, I am not an expert on real estate, but I can read. If two of the wealthiest energy and technology concerns need less space and they are reducing or not replacing pre-Pandemic employee headcounts, maybe it is time to pause some commercial space construction.
Exxon is contemplating moving staff into collaborative teams where they work in neighborhoods rather than at desks in offices. The employees will be free to choose the area they need by their interactions in a given workday. This might have been a reason for an insurrection at work before the Pandemic, but not now.
In Austin, the real estate market was supposed to defy the odds, and a year ago, building new office space was a priority. I did not fall for that then; I sure do not now. The reader must look closely at the Austin real estate market, as there are signs of a shaky 2023.
Less than a year ago, it was announced that Facebook/Meta signed for all the commercial office space in Austin’s tallest tower. Ten months later, the tech giant has no intention of filling the space; they need to sublease it. They will attempt to sublease 589,000 square feet of office space.
Today, I believe employees will give up their personal office space for the freedom to work from home when personal issues come up, within reason.
Just like people, where new office space is concerned, less is more. It costs a lot of money to build anything in today’s market.
Brick and mortar may not be a thing of the past, but it has been forever altered.
I shop online from Midland, and so do my friends in Houston. Why go somewhere when you can shop and have it delivered? As far as returns, easy-peasy. Have you been to the Galleria in Houston lately? It is scary, and at Neiman’s at the Domain in Austin, armed guards are at every door.
Less commercial space and time spent differently while working may contribute to a better life and a shift in our priorities back to home and family. The Millennials and Gen Z’s seem to prefer the less-is-more philosophy. These generations may accept less because things cost more. Thus, the minimalist lifestyle may be in vogue for a long time.
For some odd reason, I think the philosophy of the young is precisely how I was raised. Have we come full circle in my lifetime and yours?
“Your employees are the heart of your organization.” Dr. Michele Harmon is a Human Resource professional, supporting clients in Texas and New Mexico that range in size from five to more than 3,000 employees. Email: firstname.lastname@example.org