During last week’s Annual Conference of the Hawaii Economic Association, the chief executive of one of Hawaii’s largest architecture firms shared a story illustrating something that once might have been anathema to senior managers: It’s not necessary for employees to work at the office to be productive.
In fact, said Bettina Mehnert, chief executive of Architects Hawaii, 2020, a year when employees were working from home, was the most profitable and productive in the company’s 75-year history.
“If you’d asked me in the last week of March 2020 what my biggest concern moving forward would be, it would not have been finding qualified employees and handling the workload,” she said in an interview.
But that, in fact, was among the biggest challenges. The firm actually added 18 people during the pandemic, bringing its total to 102.
Productivity, as measured by utilization of the firm’s resources, increased 3% over the previous year, she said, even though, “We were all working remotely. On the 13th of March, I told everybody you don’t have a choice, we are working from home.”
Mehnert shared her story about Architects Hawaii during a panel discussion that also included insights from Honolulu economist Paul Brewbaker and John Fernald, senior research advisor in the Economic Research Department of the Federal Reserve Bank of San Francisco, who shared data that provided a statistical spine showing Mehnert’s anecdote was hardly an outlier.
The panel’s conclusion: remote work is almost surely here to stay.
And why not?
The conference itself – held remotely by Zoom – illustrated a main point: virtual meetings and conferences have become so commonplace that attending one and sharing slides or screens using tools like Zoom is about as complicated and novel for most people nowadays as picking up the phone.
Peter Kay, founder, president and chief executive of Cybercom Hawaii Inc., likened virtual meeting technology to something from science fiction: now almost anyone can go almost anywhere almost instantly.
“We have the Star Trek transporter room,” he said, and added that there are likely more things to come that will make remote work easier. He used the term “Uber everything,” saying it won’t be only drivers that will be called by an app, but all manner of professionals not typically associated with gig work.
Even the staid profession of architecture is buying in.
“You would not think of a business like ours being able to make that switch,” Mehnert said. “It is huge – it’s different – we are reinventing ourselves, and I think the industry is reinventing itself.”
Mehnert and her team at Architects Hawaii saw the power of technology as they relied increasingly on tools beyond Zoom to connect with clients. For instance, she said, a tool that allows clients to take a virtual tour of proposed projects using their phones and QR codes gained currency when architects lost the ability to meet with clients in person.
“We had it before,” she said of the ability to guide virtual tours. “It’s just that you take it further, you use it more. The thinking is there, you take the next step.”
While clients accepted the changes, she said, employees enjoyed having more flexible hours, including more time to spend with family, the ability to work at night and the lack of a commute. Employees living in Ewa and Kapolei might have spent as much as four hours a day on round-trip commutes pre-pandemic, she said.
But does one Hawaii firm’s experience illustrate something bigger going on? According to the Fed’s Fernald, it does. He showed how overall productivity during the pandemic increased even as hours worked declined. In other words, people generally spent less time on the job but did more in the time spent.
In fact, he said, productivity during the pandemic increased more than any other time in the last half century except during the heyday of the information boom when wide-scale adoption of the internet changed just about everything.
Remote Workers Still Miss Camaraderie, Views, A/C
Of course there are down sides to the work from home trend.
Kay, for instance, said as people tend to work remotely it can be easier for bad ideas to spread or at least not be instantly killed.
Mehnert said people missed things like nice furniture, views and air conditioning, not to mention camaraderie.
Another panelist, Mike Hamasu of Collier’s, a leading commercial real estate analyst, noted that the office real estate market is soft and likely will remain that way for a while, in part because firms need less space if employees work remotely.
But perhaps most troubling was Fernald’s analysis of an effect of educators working from home. He pointed to data showing students lacking access to technology or in unstable homes simply did not do as well as other students.
That, he said, is likely to result in a long-term decline in educational achievement and productivity, as a massive cohort of people with stunted skills moves into the workforce.
Short-term, he said, there might be a small increase in GDP as students drop out of school and go to work instead of continuing to learn.
But the long-term negative effect could be staggering, he said, totaling $7 trillion in lost GDP decades down the road when the current cohort of kids reaches prime working years.
“The children of today are the workforce of tomorrow,” he said.
Despite such issues, the consensus was that remote work will not go away even when the pandemic ends. Mehnert said Archirects Hawaii probably wouldn’t have tried shifting to remote work but for the pandemic.
In a profession that values interaction with clients, no company would have unilaterally decided to go remote, she said, adding that none of the firms had much choice.
“It’s working because we were all in the same boat,” she said. “It’s something we have to do, and that made it acceptable. And it will make us better.”