Editor’s Note: The “Future of Work” is a WRAL TechWire series, supported by commercial real estate firm JLL and other partners. Last week, the series looked at what’s happening in the Triangle’s economy. The first report is here, and the second piece is here. This week, we’re exploring the relationship between work spaces, work places, and the current labor market. This is a lightly edited transcript of an WRAL TechWire exclusive interview with three experts from JLL.
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RALEIGH – With a tight labor market, and an estimated 60,000 open jobs across the Triangle alone, companies are making important decisions when it comes to their workforce: where, and how, employees are expected to conduct their work.
For some companies, they’re seeking to pull talent into their offices, whether that’s new recruits for important value-added positions or for existing employees who have been working remotely for more than two years.
But one trend in commercial real estate is clear, according to Molly Glasgow, an executive vice president at JLL.
Companies are in a “flight to quality,” Glasgow told WRAL TechWire in an exclusive interview.
Special report profile: Molly Glasgow, executive vice president at JLL
“Currently when companies are investing in space or relocating to the area, they are seeking newer, nicer facilities located in highly amenitized areas,” said Glasgow. “And they are doing everything they can right now to keep employees happy.”
Or, put another way, companies are choosing to make investments in space and place. That’s because what workers want has changed, partially as the result of the disruptions to the economy and to the world of work at the onset of the COVID-19 pandemic and the subsequent two years.
“Modern offices need to create reasons for people to want to be in the office,” Pendo CEO Todd Olson told WRAL reporter Matt Talhelm earlier this year.
And that’s changing how developers, companies, and investors are thinking about space and place, Glasgow told WRAL TechWire.
“In the future of work, employees and clients will still need a place to meet, regardless of a company’s hybrid or remote work policies,” said Glasgow. “Because of this, and the pressures in the labor market, companies are selecting nicer, highly amenitized spaces to try to pull employees back to the office—rather than mandate it.”
The following is a lightly-edited transcript of an interview conducted by WRAL TechWire.
A new normal
WRAL TechWire (TW): What can companies do to prepare for a new normal, and for the future of the workplace?
Glasgow: It’s critical to understand that there’s no one-size-fits-all approach. Companies have to evaluate their own business and operational needs, and make decisions on what’s best for the business—and what supports their people, their culture, and the work they are doing.
Molly Glasgow, executive vice president, JLL
There’s no one hybrid model or policy that works for every company.
Employees are and will continue to demand some sort of flexibility in their work. But the reality is that there aren’t any proven case studies for “the future of work” yet—we are entering into a five to ten year experiment. The experiment only begins when folks have re-entered or returned to the new normal. This hasn’t fully happened yet.
Our recommendations for our clients today are that they focus on assessing their operational needs, understanding what their employees need to be successful and feel supported, and to not lose sight of what is critical to continue to drive creativity and innovation — in most cases some sort of in person collaboration is required to optimize innovation.
Impact of hybrid work on office design, location
TW: What are you hearing from clients, partners, about the future of hybrid models of work, and the impact on office design and office size and location?
Courtney Fain, vice president of workplace planning and strategy at JLL (Fain): A recent JLL survey shows nearly 50% of respondents expect workers to spend two or three days in the office.
Courtney Fain, vice president, workplace planning and strategy, JLL
But the survey also shows that these respondents have not determined an official return to office strategy.
As it relates to office space, we are seeing a clear flight to quality.
Since the onset of the pandemic, 39.1 million square feet of space in buildings delivered since 2015 has been absorbed, compared to outflows of 188 million square feet elsewhere.
Technology companies alone have leased 15.3 million square feet, while also publicly announcing plans for their workforce to remain remote.
Glasgow: What we’ve heard from our clients is that most companies want to see people in office work two to three days a week. All employees want some sort of flexibility.
How this is structured may vary by company, and even within a company by job function—focus needs to be on “what is the purpose of the office” and then the workplace strategy should support this purpose and enable people to be successful in their roles.
What employees want
TW: Based on what you’ve observed or measured, why do employees stay, and why do they leave?
Courtney Fain, vice president of workplace planning and strategy at JLL (Fain): Employees stay for a lot of reasons, and it could be different for everyone: feeling supported and valued, enjoying their coworkers, respecting their leader, alignment with the company mission and vision, they have true flexibility, competitive pay, good benefits, tenure, and sometimes it’s simply easier to stay put.
Employees may leave if the opposite is true for any of the above, or perhaps they simply need a change. Ultimately, employers need to focus on what is within their control.
Clare Greco, vice president, project and development services at JLL (Greco): People want to be supported.
Clare Greco, vice president, project and development services, JLL
They also want a sense of purpose. And, they want to measure their success within an organization.
The best companies may not have all of the answers.
But they are listening and engaging their teams in discussions about how to successfully address various ways to build a diverse, motivated and engaged approach to doing business.
Glasgow: Companies are competing on compensation right now, but it’s so much more than that. People want to be connected to purpose, feel like they are adding value and feel heard and appreciated. Leaders are navigating very complex issues right now and no one has it all figured out. Transparency in your communication (and trying to learn, grow and be better), as well as leading with a focus on your people—is critical. Understanding employee needs and making them feel heard.
We’ve heard this phrase ‘stay interviews’ recently. Companies are looking for new ways to connect with their existing talent to make sure they are engaged and appreciated.
Employees are also demanding more training and development from their employers than they have before—they want to know that their organization is invested in their success and that they have opportunities for growth.
Special report: Space in high demand, even as future of work remains uncertain
Training, development
TW: On the workforce development and training front—what’s the latest in this area?
Glasgow: Training and workforce development is one of the areas that organizations are struggling with the most. The reality is that the world has changed drastically, but this part of the business hasn’t changed yet in many organizations.
Time needs to be spent focusing on how to better understand what your talent needs to be successful in the world today, and the training and support resources need to then be adjusted to support this. For example, now mid-level managers are responsible for managing employees in a hybrid world—yet no one has been trained to do this effectively.
We need to look at how we are preparing our managers and leaders to navigate the fast changing environment.
Special report: The future of the Triangle’s economy hinges on its spaces
Infrastructure
TW: So how are employers rethinking their physical infrastructure?
Greco: Employers are looking for ways to invigorate their buildings with more usable outdoor space, common areas and would like to integrate the latest sustainable designs and healthy building technologies.
Real estate investors and operators are investing in more sustainable features including electric vehicle charging, photovoltaics, energy efficient lighting and other building life cycle investments to increase the value and marketability of their facilities.
Glasgow: For now, Hybrid is here to stay. As a result, the purpose of office is shifting and we are seeing more collaboration space and less individual space. One focus is on health and wellness—better ventilation and enhanced HVAC systems, biophilic design, more natural light, and access to outdoor work spaces, including working and meeting spaces.
There’s also a desire to push people to the window line for more natural light in large gathering and collaboration spaces—we have seen this in several recently completed office projects.
Companies are also using space to connect people to the mission of their business. In person collaboration is key to building trust and connecting people to a common purpose. Gen-Z talent is specifically more focused on the mission of their work than some of the prior generations.
Special report Q&A: Perspectives on a changing economy and the ‘Future of Work’
Technology implications
TW: What are the technology requirements to successfully implement a hybrid or fully remote work environment?
Glasgow: Hybrid requires a fully integrated space from a technology perspective in order to create equitable experiences for employees who are both in person and working remote. This is particularly important in meeting spaces in order to support both productivity and avoid creating “two classes of employees”. Additionally, if the purpose of the office is to foster collaboration, organizations will need supporting technology so that others know when people will be in the office vs working remote and where to find people when they are in the office (particularly in the case of workspace with unassigned seating). There are various technology platforms to support these needs — reality is that successful hybrid work will require a technology investment to ensure that the experience is seamless and productive.
Fain: For technology, we are seeing a greater focus on the user experience.
Companies are bringing in A/V vendors earlier to make sure the hardware and software will increase productivity—not create headaches.
There is a significant increase in companies using workplace apps to facilitate a seamless work experience, and they benefit from the backend data to adjust where they need to.
From a health and safety perspective, the general public is a lot more aware of how a building can affect their health. One of the easiest ways to improve air quality is to add UVGI lamps within the HVAC system, and upgrade your filters to a minimum of MERV 13.
‘Future of Work’ via LinkedIn Live: Investors see Triangle with ‘room to run’ in coming decade
Sectors primed for hybrid
TW: What sectors, industries, or roles are particularly well-suited for remote or hybrid work?
Fain: The obvious answer is tech companies, but the qualification is not just industry-specific.
Within every industry there are departments, job functions, cultures, and individual personalities that are ripe to be fully remote, and those who are not. Most computer-based, knowledge worker roles can be completed somewhat remotely, but I’d argue that even because a job can be completed remotely doesn’t mean it always should be.
Glasgow: Companies really need to take a look at the function of their employees—how someone is working—and not at the industry as a whole. Some roles and work can be done fully remote—but it doesn’t always mean they should.
There is a reason that mental health issues have been on the rise during the pandemic—people need human connection. I’d also add that most companies need to continue to innovate in order to drive growth—and innovation generally occurs through collaboration and the sharing of ideas. This can be difficult to consistently achieve and support in a fully remote world.
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This editorial package was produced with funding support from JLL and other partners. WRAL TechWire retains full editorial control of all content.
