Despite the working from home boom, we’ll still need our central business districts. Picture: AAP
Two weeks ago, I wrote that Australia should grab a once in a generation economic opportunity, never thinking we would actually do it.
But suddenly the messages coming out of Canberra are that our government is about to grasp a big chunk of those opportunities.
Perhaps our greatest danger to realising this new potential that the “working from home” boom will go too far and cause decay in the central business districts.
We will never go back to the old nine to five rush, but large enterprises that go too far the other way may actually endanger their future.
But first, here are three Australian opportunities that will not last long:
Our rivals in education, led by the UK, Europe and the US, are crippled, and few overseas students would choose to go to those COVID-19 stricken areas to study. We need to encourage overseas students to come here and undergo 14 days quarantine: a move now made possible by the opening up of cafes and restaurants that provide part time work.
It looks like the long awaited Chinese crackdown on Hong Kong is about to start. We have a unique opportunity to tap part of the Hong Kong skills and capital base because, again, our low COVID-19 infection rate will enable us to become the country of choice for skills and capital migration.
A lot of global enterprises are experiencing the high risks of operating in countries outside of Australia and New Zealand. Already many in our expat community now recognise the new potential Down Under and are returning home. But we can attract many more enterprises to open up here, particularly if we start to develop a strong skills base as the Prime Minister is now advocating.
And thanks to the vision of that much maligned former politician, Stephen Conroy, we have a national broadband network. Granted, it’s not as good as the original Conroy vision, but better than most countries. This greatly enhances the flexibility of Australian operations.
Overseas tourism by Australians and incoming overseas tourists are going to be off the agenda for a long time. But Australians spend about twice the amount of money overseas that overseas tourists spend in Australia. Again, this is a unique opportunity to boost the local tourism industry.
As I pointed out on Monday, Australians are now looking at buying cars.
But right now, our big capital cities are wastelands and incredible as it might seem, if we go overboard in home working we will destroy much of the central business districts of Sydney and Melbourne to a lesser extent the other capitals.
Overdoing it
I emphasise that working from home is going to be an important part of future business and government life but there are hazards to both the CBD areas and the enterprises themselves if over used.
It’s only a few decades ago that many parts of New York were a “no-go” areas. Australia has substantial investments in its cities including extensive office blocks, and a multitude of restaurants and cafes, as well as nearby theatre districts All are major employment hubs.
In addition, dwellings near capital cities carry a price premium because of their easy access to CBD employment. If large enterprises withdraw from CBDs, then we are looking at the prospect of staggering institutional and individual capital losses that will affect community prosperity for decades.
But until there is a COVID-19 vaccine CBDs need to lift their game. The constant rent rises must stop.
Right now, it’s extremely difficult to reach the top floors of office towers without breaching distancing rules in lifts and public transport carries a much higher risk in the pre-vaccine COVID-19 era. There are not enough car spaces for people to drive to the CBD and bike riding is not for everyone. We need to improve the virus safety of our public transport network and lifts. Other cities have found the best way to secure this is to have masks.
Telstra CEO Andy Penn revealed in a commentary in The Australian that Telstra had 25,000 people working from home. Telstra’s strategy has been duplicated by many large enterprises and a big proportion of those workers would previously have been working in Australia’s central business districts.
WFH is not for everyone
Many employees – but not all – are far more productive at home and intelligent use of working from home retains skills and benefits enterprises. Although its bad news for Qantas the number of interstate business trips are set for long term reduction in the wake of the Zoom boom.
But unless he is very careful Andy Penn and the CEO’s of many other large enterprises have sowed seeds that could lead to long term destruction.
The problem of having the vast bulk of your office workers working at home is that there is a great deal less personal interaction which makes it much harder for younger employees to learn from their older peers. I know that in both legal and accounting firms the young inductees are now feeling very lonely.
Large enterprises gain their momentum via young people emerging in the ranks. They will simply leave the big companies and firms for smaller enterprises where they can get hands-on training.
Once communication face-to-face communication is slashed over the long term then it also becomes harder to select the right people to promote and the isolation increases the likelihood that the better performers will be poached. Working from home is a valuable adjunct to productivity but if overused it is also a long term trap. Central business districts must be part of our prosperity.
