1. Office occupancy levels on the busiest day of the week currently stand at 62% of their pre-pandemic average in February 2020, based on data from Kastle Systems tracking 10 major metropolitan areas. This decline in office usage over the past four years since the onset of COVID-19 has had far-reaching impacts on various aspects of daily life, affecting where people choose to live, how they balance work and family commitments, and reshaping business operations.
2. The commercial real estate market is undergoing significant turbulence as a result of this shift, as highlighted by Axios' Kate Marino. Peak office days, usually Tuesdays or Wednesdays, serve as a critical metric for employers looking to accommodate employees opting for in-person work. CEO Haniel Lynn of Kastle Systems notes that these high-attendance days, with a 61.7% occupancy rate, paint a clearer picture of the return-to-office momentum compared to just relying on the five-day average.
3. While occupancy levels are showing a slight uptick on peak days, reaching 61.7%, Fridays witness a drop to around 35%, ultimately dragging down the weekly average to 52.5% for the week ending March 6. Despite the gradual increase on peak days, full occupancy at pre-pandemic levels is unlikely shortly, according to Lynn's projections.
Workers who keep their jobs after layoffs are considered the lucky ones. Still, dealing with the stress and guilt of a changed workplace can be harrowing for those unsure if they will be next.
Those Who Remain
Being marched out of an office (or, in our hybrid age, being locked out of a corporate email account) is, for many workers, a worst-case scenario. But another, less visible slice of the workforce also struggles when layoffs happen: those who keep their job and have to navigate the emotional and logistical turmoil of carrying on in a slimmed-down company, all while wondering if they will be next.
Workers who survive job cuts are likely to feel grief and shock, of course, but also remorse. They may feel relieved to keep their job—but then guilty about it, Sandra Sucher, a professor at Harvard Business School who researches the hidden costs of layoffs, told me. Workers usually operate under the assumption that if they do good work, they can keep their jobs. Layoffs erode trust by putting “a wedge” in that compact, Sucher explained, injecting uncertainty into one’s career—and making employees wonder whether their companies are treating them fairly.
Those who keep their jobs frequently deal with the logistical fallout, too, which can mean taking on former colleagues’ responsibilities. “If managed poorly, [layoffs] mean that not only am I feeling emotionally distraught and at risk personally, but also I have a changed work environment,” Sucher said.
How well companies handle layoffs varies widely—and, in general, they have gotten less humane, Peter Cappelli, a professor and the director of the Center for Human Resources at the University of Pennsylvania’s Wharton School, told me. The era of mass layoffs as we know it began in the 1980s when the deregulation of several major industries and a weakening labor movement collided with the rise of more cutthroat corporate leaders. As executives slashed jobs, though, many companies went to great lengths to set up smooth transitions for laid-off workers with the help of outplacement companies, which provided resources and job leads for white-collar workers who had been axed, Capelli explained. That industry contracted during the Great Recession, he added. Now some companies reassign employees or offer generous severance packages, but others just pull the plug on people’s email accounts and send them on their way.
Adding to the stress of looming layoffs is that many firms lately, especially tech companies, have cut people in multiple rounds—leading workers to feel like they could be next at any moment. Rather than pulling the Band-Aid off, as Cappelli put it, companies are laying off smaller groups so they can wait to see how their financial situation unfolds. While this flexible approach may appeal to shareholders, it can also damage morale. “It’s an optimization answer rather than a human answer,” Cappelli said.
The long-term effects of layoffs on the health of a company can be stark. In general, Sucher said, the resulting slump in morale can contribute to significant declines in job performance and satisfaction. Slashing jobs may not even help a company’s stock price, because layoffs signal to the market that a company is facing trouble. And severance and other layoff expenses can add up.
So why do companies, especially tech firms sitting on piles of cash, keep letting people go? Because everyone else is, Jeffrey Pfeffer, a management professor at Stanford University, argues. Tech companies are “rolling in dough, and in many instances, their stock prices are at or near an all-time high,” Pfeffer told me. So the idea that the layoffs are fundamentally driven by financial necessity is “not true at all”—he sees it more as a case of “social contagion.”
Executives are not calculation machines, Capelli added. They’re human and subject to pressure from both investors and peers. After the tech giants overhired in 2021 and 2022, they seemed to get spooked by more recent changes in the economy, including the interest-rate hikes that made borrowing more expensive. No executive wants to be seen as a laggard, so when layoffs began at some companies, others followed suit.
It used to be that letting go of workers en masse would puncture an employer’s reputation. But now a tech worker looking for a job would be hard-pressed to find a large company that hasn’t done major layoffs over the past two years. (Apple has so far been an outlier in this regard.) As Pfeffer put it: “You have to work for somebody.” Still, the drumbeat of cuts may make the industry overall less appealing to ambitious young people entering the workforce, Cappelli said.
What amazes Cappelli is that many executives seem to have learned little from previous periods of layoffs—and continue to fumble the communication and execution of such cuts: “We just don’t have any sense of history.”
Lyft and Uber said they will cease operations in Minneapolis after the city’s council voted Thursday to override a mayoral veto and require that ride-hailing services increase driver wages to the equivalent of the local minimum wage of $15.57 an hour.
Lyft called the ordinance “deeply flawed,” saying in a statement that it supports a minimum earning standard for drivers but not the one passed by the council.
“It should be done in an honest way that keeps the service affordable for riders,” Lyft said. “This ordinance makes our operations unsustainable, and as a result, we are shutting down operations in Minneapolis when the law takes effect on May 1.”
Uber did not immediately respond to a request for comment, but news outlets reported that it issued a similar statement saying it would also stop service that day.
Both companies promised to push for statewide legislation that would counter the Minneapolis ordinance, and state House Republicans proposed a bill Thursday that would preempt local regulations of ride-hailing services.
The City Council first passed the measure last week in a 9-4 vote despite Mayor Jacob Frey’s promise to veto it. The measure requires ride-hailing companies to pay drivers at least $1.40 per mile and $0.51 per minute for the time spent transporting a rider — or $5 per ride, whichever is greater — excluding tips. In the event of a multi-city trip, that only applies to the portion that takes place within Minneapolis.
Critics of the bill say costs will likely spike for everyone, including people with low incomes and people with disabilities who rely on ride-hailing services. Supporters say the services have relied on drivers who are often people of color and immigrants for cheap labor.
“Drivers are human beings with families, and they deserve dignified minimum wages like all other workers,” Jamal Osman, a council member who co-authored the policy, said in a statement.
“Today’s vote showed Uber, Lyft, and the Mayor that the Minneapolis City Council will not allow the East African community, or any community, to be exploited for cheap labor,” Osman added. “The Council chooses workers over corporate greed.”
Democratic Gov Tim Walz, who vetoed a bill last year that would have boosted pay for Uber and Lyft drivers, told The Associated Press on Wednesday that he was concerned because so many depend on those services, including disabled people.
He said he believed the companies would pull the plug, “and there’s nothing to fill that gap.”
Walz added that he hopes the Legislature will seek a compromise that both includes fair pay for drivers and dissuades the companies from leaving.
Seattle and New York City have passed similar policies in recent years that increase wages for ride-hailing drivers, and Uber and Lyft still operate in those cities.