For the better part of three years, some CEOs have fretted about remote work. They’re tired of empty offices, constant Zoom calls and uncertainty about where their employees are. But big changes have already begun, with many employees already returning to the office. Those who show up will most likely be rewarded for it.
According to consulting firm KPMG’s annual U.S. CEO Outlook Survey, a majority of CEOs believe remote work will be over within the next few years. Of the 400 CEOs surveyed, 62% – all from companies with at least $500 million in revenue – said they envisioned a return to offices within the next three years in roles they held before the pandemic. That’s nearly double the 34% who made a similar prediction in last year’s survey.
“I attribute this change to business leaders who believe that full-time office collaboration can increase productivity,” said Paul Knopp, chairman and CEO of KPMG US. wealth.
In another sign of the shift in thinking, only 4% of CEOs expect that roles that used to be face-to-face will become fully remote. Few executives believe that roles that used to be entirely in-person will remain entirely remote, as they were in spring 2020. Knopp doesn’t see the survey’s results as a clear prediction, however, but rather as an indication that companies are trying to differentiate between the unlimited flexibility of remote work and the rigors of being in the office five days a week. The American workplace is in what he calls an “experimental phase.”
“Many CEOs are still trying to imagine what’s best for their businesses,” Knopp said. “That 62% is an ongoing journey toward more in-person collaboration, but I don’t think that’s a reliable prediction of where we will be three years from now.”
He added that the reason for this uncertainty is that many companies are still unsure about the best way to balance productivity and attendance. Some CEOs “tend to think that working full-time might be better for their business,” Knopp said. “I think it remains to be determined whether it’s actually going to happen.”
CEOs say they will start prioritizing workers coming into their offices, marking another possible watershed moment. In fact, 90% of CEOs said they were likely to “reward employees who work hard to get into the office with favorable assignments, raises, or promotions.” Only 1% of CEOs said they were unlikely to do so. Another 9% of people in the survey chose neutral, meaning they were neither likely nor likely to do so.
These findings suggest that in the future, companies will no longer offer benefits such as free lunches and on-site gyms to incentivize all employees to come to work. Instead, they plan to explicitly reward employees who go out of their way to come to the office. After Labor Day, another 1 million U.S. workers face new requirements to return to the office, according to data from commercial real estate firm JLL. Despite the big numbers, JLL warns not to expect a big jump in attendance after the mandate, as employees will be slow to change their habits, especially if they prefer remote work arrangements.
Knopp said he is not opposed to offering carrots to those who decide to show up in person, but should proceed with caution. “If you’re mandating more face-to-face time in the office, it’s not without risks,” he said. “So I think I’m going to be cautious moving forward and I’m going to listen a lot to my employees.”
Gleb Tsipursky, CEO of leadership consulting firm Disaster Avoidance Experts, is more pessimistic about rewarding office hours. Factoring time employees spend in the office into pay increases and promotions creates a “counterintuitive situation” where employees are no longer rewarded for their productivity, he said.
“Companies that pursue such incentive programs will naturally see their performance and productivity decline,” Zipulski said. “What is measured and rewarded is what is done.”
Adopting such a policy could hurt employee retention, he added. “Highly qualified employees will find that performance and productivity are not as rewarded, and they will leave for companies that value performance and productivity over performanceism and sycophancy,” Zipulski said.
Since vaccines became widely available in the spring of 2021, return-to-work mandates have begun to trickle in, with some companies trying to offer benefits to encourage employees to come to work or penalize those who don’t. For example, real estate research company CoStar Lucky draw prizes Examples include offering employees who come to the office a $10,000 bonus, a flight on a company jet, and a new Tesla.Meanwhile, in the legal world, some law firms have taken a more punitive approach and begun telling employees that poor attendance will mean lower bonus.
CoStar’s example, while quite generous, was still a benefit outside of employees’ day jobs, and the decision to withhold bonuses was more of a punishment than a reward. Emerging trends appear to point to a CEO mindset that more explicitly links career development to face-to-face work.
Knopp believes workplaces are still figuring out what the new status quo will be, and he advises everyone to proceed with caution. “Whether you are a worker, an employee or a leader, we are all playing chess,” he said. “You have to think about how this is going to play out in the future.”
Svlook
