Some people may refer to their company’s headquarters as the Mother Ship.
But economist Robert Shiller has a different theory about the relationship between space, time and — well — work. As companies increasingly push workers to return to the office, one prominent economist says that a fundamental shift is underway.
“I think there’s going to be a revolution because of work at home,” Shiller, the Nobel-Prize winning professor of economics at Yale University and co-founder of the Case-Shiller Index, told MarketWatch.
“‘It’s just like the space project. The trips to the moon and to Mars came out after a horrible World War II. Sometimes bad things can stir things up a bit and make for a better outcome in the future.’”
— Robert Shiller
City center retailers have already noticed the change in consumer habits, research suggests, and builders are looking for new developments. “It will take time for construction to accommodate that,” Shiller added.
Earlier this week, Goldman Sachs GS,
“It’s an important positive development that we’ve seen as a result of the COVID-19 epidemic,” Shiller said. “It’s just like the space project. The trips to the moon and to Mars came out after a horrible World War Two. Sometimes bad things can stir things up a bit and make for a better outcome in the future.”
Novelist and historian Sarah Sundin has researched the connections between World War II and the moon landings — from postwar rocket development, improvements in navigation systems to the development of artificial rubber.
“Countless other technological developments from WWII led to that momentous day in 1969,” she wrote. “Artificial rubber, developed due to Japanese control of rubber plantations in South Asia, led to advanced materials used to build the rockets and spacesuits.”
Others agree that a healthier work-life balance is one positive development since the pandemic that could improve the quality of people’s lives over the long term. “I do not think people are going to be returning to the office five days a week,” Annie Thompson, a lecturer at the Center for Real Estate at the Massachusetts Institute of Technology, told MarketWatch.
The number of apartments under construction in major cities in the Sun Belt — from Atlanta to Austin — is expected to exceed the number of tenants expected to occupy them, and that is pushing rent growth down, according to recent data from CoStar Group CSGP,
“‘I do not think people are going to be returning to the office five days a week. Settling in on a two- to three-day home office breakdown is going to be most likely.’”
— Annie Thompson
Investors who are seeing rent growth fall are consequently shifting their money into Midwestern markets, the company added, where they are still finding slow but steady growth.
Shiller also said that even though some companies have tried to bring workers back into the office five days a week, that trend may not catch on. In fact, there were more than 700,000 advertised vacancies for fully-remote roles in July.
Thompson, who collaborates with Shiller on an annual survey of home buyers, said remote and hybrid work will obviously be more prevalent in some industries than others. “Settling in on a two- to three-day home office breakdown is going to be most likely.”
And Shiller? He will be working on a hybrid model. “It’ll be in between,” he said. “It’ll be more work at home.”