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NYC lags behind US cities in getting workers to return to offices

NYC lags behind US cities in getting workers to return to offices

The Big Apple is lagging behind other cities around the country in getting staffers to ditch working from home and return to the office, according to a new report.

Just 20.7 percent of employees in New York City were back in the office as of June 9, according to building management firm Kastle Systems, which has monitored key swipes in 2,600 buildings that house 41,000 businesses it services across 46 states since last April

Across the 10 largest cities in the US, Kastle estimated that an average of 31.5 percent of workers had returned to the office.

New York isn’t alone in lagging its urban peers. Workers in San Francisco and San Jose are heading back to the office at even lower rates than in New York City, with just 18.2 percent and 20.2 percent back in the office, respectively, according to Kastle.

Texas’ cities, on the other hand, are far outpacing the rest of the nation in the return-to-the-office effort. Dallas, Austin and Houston all saw the share of workers going into the office rise by 3.7 percent from the prior week, up to 49.7 percent, 48.7 percent and 47.7 percent occupancy, according to Kastle data.

Data collected by Kastle Systems shows that far fewer New York City workers are returning than in cities like Dallas, Austin, and Houston.
Data collected by Kastle Systems shows that far fewer New York City workers are returning than in cities like Dallas, Austin and Houston.
Kastle Systems

With COVID-19 numbers continuing to fall as vaccinations rise, office occupancy is steadily rising in cities nationwide, Kastle’s data shows.

Compared with the week prior, New York City’s office occupancy rose by 2.5 percent. At the same time last year, Kastle’s data shows that just over 5 percent of employees in New York City were going back into the office.

Office occupancy in Chicago rose by 3 percent over the prior week to reach a total of 27.5 percent of workers in the office, according to Kastle.

People walk through  Manhattan.
New York City’s office occupancy is 2.5 percent higher than it was a week ago.
Spencer Platt/Getty Images

Occupancy rates in California’s San Jose, San Francisco and Los Angeles all rose at the most modest week-over-week rates of the top 10 cities, up just 1.5 percent, 1.5 percent and 1.1 percent, respectively, Kastle’s data says.

The data comes as employers, many eager to return their staffers to the office, and workers, many of whom feel they’ve proven they can work effectively from home, duke it out over plans to return to pre-pandemic working norms.

Earlier this week, Morgan Stanley CEO James Gorman issued a stern warning to his staff: Come back to the office by Labor Day or face a pay cut.

“Make no mistake about it. We do our work inside Morgan Stanley offices, and that’s where we teach, that’s where our interns learn, that’s how we develop people,” he said. “If you can go into a restaurant in New York City, you can come into the office.”

“On Labor Day, I’ll be very disappointed if people haven’t found their way into the office. Then, we’ll have a different kind of conversation,” the head honcho warned.

To those who fled New York City for more spacious and cheaper homes, Gorman sent a sobering message: If you want a New York City salary, you’ll have to be in the five boroughs to earn it.

“If you want to get paid New York rates, you work in New York. None of this ‘I’m in Colorado and work in New York and am getting paid like I’m sitting in New York City,’” Gorman barked.

“Sorry, that doesn’t work.”

Stripe, an online payments startup valued at $95 billion, has taken a similar stance. The company told workers in September they could leave offices in New York and San Francisco to work elsewhere permanently, and they’d get a one-time bonus of $20,000 but also a permanent 10 percent salary cut.

At 20.7 percent, New York City sits below the average of workers returning to the office collected in 10 major US cities.
At 20.7 percent, New York City sits below the average of workers returning to the office in 10 major US cities.
Kastle Systems

On Wednesday, the company’s CEO John Collison said Stripe “saw pretty major uptake.”

“There were a lot of people who took advantage of all the remote working that was going on last year to be able to move to be closer to their families, to somewhere they wanted to move previously,” he said, without providing a specific number.

About the author

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Julia Mangels

Julia has handled various businesses throughout her career and has a deep domain knowledge. She founded Stock Market Pioneer in an attempt to bring the latest news to its readers. She is glued to the stock market most of the times and just loves being in touch with the developments in the business world.

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