Will the end of “work from home” transfer economic activities back to the city centres?

In the United Kingdom, the “work from home” mandate has been removed. People are free to return to their office or may have to return to their offices depending on the organisation they work for. In the past two years every time a new more contagious variant tool hold those who had started going back to their offices stop. Every time people went back to exclusively working from home, city centres emptied. Retail and hospitality businesses based in city centres saw a sudden drop in business and there was no reliable prediction of how long the drought would last.

The return of commuters to city centres will be a boost to business sectors that have been struggling for almost two years. Those who did not close shop, adapted to a new reality that saw their central location turn from being their main asset to becoming their greatest liability. City centres were empty, whenever entrepreneurs had put together measures that would allow them to operate and keep their clients safe a new variant would appear and cause client cancellations, reduced footfall, etc. In other words, things went back to being tough before they had actually improved. Although many people are expected to settle for a hybrid week with “office days” and “work from home days”, there will be more people in the city centre.

Will revitalised city centres boost the economy, or will we see a transfer of economic activities from the suburbs back to the city centres? Running errands during a lunch break shifts some economic activity away from the suburb, those errands would have taken place anyway even when working from home. However, a commuter uses transport to go to work, buys coffee or breakfast on the way to work, and has lunch. It is reasonable to expect some level of post-work social interaction to restart. A drink with friends and colleagues after work can only happen in the suburbs If your friend or colleague lives nearby.

Railway and public transport will see an increase in the number of passengers, National Rail showed a ten percent increase in rush hour travel compared to the week before the mandate was lifted. It is reasonable to expect that traffic will go back to pre-Omicron level fairly quickly. Irrespective of their position on vaccines, face masks, etc., people are eager to go back to some level of normality. City centres may not go back to what they were in December 2019, but they will be more populated. It may not be the end; it could be the beginning of the end, especially if the number of new cases per day continues to go down.

Silvano Stagni

Silvano Stagni, contributor at Parliament Magazine and managing director of Perpetual Motion Consulting and Research, asks whether we have the data to navigate the changes to the relationship between making the investment decision and executing it.