Real reasons why tech giants are hugging “Remote Work”

It is a huge bet that productivity in the long run is equal to or greater than the savings in rent. When you do the math on the occupancy cost per square foot relative to the labour cost on a per square foot basis (using a company’s occupancy numbers divided by square footage of the office), it works out to 4 - 7%. If you increase employee turnover slightly or decrease productivity in the long run by a small amount, you’ve erased the gains and destroyed your company culture in the long run. Oh, and if you give your employees a bunch of money to fit out their home offices and start paying for their internet at home and give them money for lunches and whatnot, you’ve just erased a portion of the savings in rent and further reduced the odds against you as employer will be net positive.<p>It is a hugely levered bet and to see all of these companies making this bet on the basis of a 3 month experiment with, to say the least, confounding factors, seems irresponsible.

&gt; So, you want to work remotely for Facebook? Great! All you have to do is figure out your own office space (much like how an Uber driver is responsible for the upkeep of their vehicle)<p>This 100%. But also - my own economic ideology position is that employees should be as self-empowered as possible. If your employer owns all your tools, your workspace, your IP, etc. then they completely control your access to the labour market. The means of production should be as widely distributed as possible to prevent huge power imbalance in favour of employers. Remote Work will mean that people can move companies easily (which means putting up with less shit since you can just move), be setup for freelance work already if they need extra income or want a break from working for somebody else, can learn more about their toolset due to being responsible for setting up an environment to work from home, etc. While there are some downsides, I think this is an overall positive.

The real reason may just be the failure of a legitimate second hub after the Bay Area: Facebook needs to hire 10k more people this year and maybe tens of thousands more over the next decade. There is no single place they can do that, and by the time they tally up all the possible other offices it might just make more sense to shrug your shoulders and make it officially and literally “anywhere.” In this version, it’s likely the emerging technology hubs which lose to cities with simply great quality of life or low costs, and the Bay Area continues relatively unaffected.

Working remote just makes so much more sense. My old routine was - get up, have some coffee, start dreading the one hour commute, then do the one hour commute, then get to work and spend an hour decompressing from the one hour commute... now it’s get up, pour a cup of coffee, start enjoying working on stuff in my bathrobe. And the coffee is way better than what the office was paying for :-)

All these analyses are forgetting one big reason: culture (and yes, cost too of course). The first office I built (out of 6 or so) was open plan, specifically because I was starting up a tech company in a conservative culture where the &#x27;boss&#x27; was behind a close door (often a solid, non-glass door). Open plan meant not just more people per sq.mt. and cheaper construction (which it does, by an order of magnitude); it also meant that the boss was available for any question no matter how trivial by just calling out his name.<p>That was a huge step back then. I know it&#x27;s almost expected now (which is probably why we&#x27;re ready to move to remote&#x2F;open cultures) but you gotta remember why open plans were revolutionary when they appeared and what cubicle farms meant for the company values, not just its lease payments.

Cynical but in a dumb way. A moment of thought will tell you that lost productivity by being all remote outweighs the benefits money that the FAANGs are saving. If they could just shovel that money they&#x27;re saving to the employees to get that productivity back, they would.<p>A smarter cynical take would be that it&#x27;s more likely that 1) they know their employees don&#x27;t want to risk COVID-19, 2) they don&#x27;t want to risk their employees getting COVID-19, but not for the reason he states but instead because that people worried about getting sick at the office are less productive, and 3) they want their precious little cash cow employees back producing milk at full speed as soon as they can.

At least in Amazon&#x27;s case they used their massive hiring power to force everyone into a small region of the city owned by Paul Allen, developed by Vulcan Inc. Then Amazon payed four times the market rate for the properties from Allen.

&gt; each employee in the San Francisco Bay Area costs an extra $20,000 to $35,000 per year<p>This is where they lost me. I can make $140k working remotely for a job that is a minimum $200k in San Francisco. And that is just salary. It doesn’t count rent, lunches, and other office costs.

Its the new companies that build on a &quot;remote first&quot; &#x2F; &quot;work from anywhere&quot; foundation that have a tremendous advantage here.<p>With a few more &quot;cultural shifts&quot;, there will be little overlap left between 20th and 21st century work structure(s).

“ok, no more dorms, everyone just go study at those cool, full of freedom off campus apartments!”

I&#x27;m saying this for years now.<p>Companies burning billions for real estate alone, while all their teams are working remote in respect to each other anyway.<p>My hopes are, this will relieve cities from the huge burden these companies were...

TLDR cost savings for the company