Several large companies are reversing the remote work policies they enacted during the lockdown-induced recession and are requiring employees to appear in physical office spaces for at least part of the week.
Many firms in the sector have been dismissing large portions of their headcounts as post-lockdown demand surges begin to mitigate. Amazon and Walmart told their employees to appear in the office at least three days and two days per week, respectively.
Amazon CEO Andy Jassy wrote in a Friday memo to employees that the company believes “teams tend to find ways to work through hard and complex trade-offs faster” when they are in the same physical location.
“It’s easier to learn, model, practice, and strengthen our culture when we’re in the office together most of the time and surrounded by our colleagues,” he continued. “When you’re in-person, people tend to be more engaged, observant, and attuned to what’s happening in the meetings and the cultural clues being communicated.”
Beyond requiring their technology employees to work from offices at least twice each week, Walmart will close three technology hubs in Texas, California, and Oregon. Employees will be compensated for their relocation expenses to cities with primary technology hubs if they decide to remain with the company and will be offered severance if they leave the firm, according to a Monday memo from Walmart CTO Suresh Kumar seen by the Wall Street Journal.
Employees generally prefer remote or hybrid work arrangements due to time savings from avoided commutes, as well as the flexibility to more easily balance work and personal matters, according to a poll from Gallup. The costs for employers, however, can outweigh the benefits from attracting and retaining talent: 85% of managers say the shift to hybrid work “has made it challenging to have confidence that employees are being productive,” according to a study from Microsoft.
Disney CEO Bob Iger likewise announced last month that he would require employees to work from offices, preferably between Monday and Thursday. “As you’ve heard me say many times, creativity is the heart and soul of who we are and what we do at Disney,” the executive remarked. “And in a creative business like ours, nothing can replace the ability to connect, observe, and create with peers that comes from being physically together.”
Many companies, on the other hand, have allowed top performers to continue working from home. Walmart will permit some employees to remain full-time remote staff members; Tesla CEO Elon Musk, a leading skeptic of virtual work arrangements, has said that he would consider allowing “particularly exceptional contributors” at the automaker to work remotely.
The trend toward consolidating office spaces and requiring employees to return to offices occurs as several technology companies face pressure from investors over declining profitability, resulting in the decision to introduce mass layoffs. Microsoft, Google, and Amazon revealed their intentions to decrease payrolls by more than 40,000 workers over the past several weeks. More than 77,000 workers have been dismissed from prominent technology firms thus far in 2023, according to a report from Crunchbase, even after companies in the sector dismissed some 140,000 positions last year.