Back to work, back to spending
FREEDOM, or at least a little more latitude, comes tomorrow. The most obvious manifestation of the relaxing of the Covid-19 rules will be outdoor eating in pubs and restaurants, and the opening up of non- essential shops, as well as hairdressers.
The country will feel different: not normal, but something more like those distant days we all remember.
These regulations are about spending money, not about earning the stuff. The rules on that may not formally change until June, but while the ‘ work from home if possible’ guidance remains, in practice things are changing.
In London, JP Morgan and Goldman Sachs have started to bring back some more people to the office. The City of London Corporation has seen office planning applications shoot up, and a KPMG survey of 500 major companies around the world showed that most of them no longer expected to reduce their office space. Why?
Well, there are many reasons, including the difficulties of training new staff.
But perhaps the most important is that firms are finding that they cannot really run things if they don’t have their people together at least some of the time under one roof.
Take the case of AstraZeneca. I think it has been treated disgracefully by the European Commission and pretty poorly by the US authorities too.
No major pharmaceutical company is going to try to run a notfor-profit venture for a long time if this is the thanks it gets.
But I do agree with Thierry Breton, the French businessman who is now commissioner in charge of the European Union’s vaccine programme, when he told Pascal Soriot, AstraZeneca’s chief executive, that he was a bit surprised that Soriot was trying to run the business from his family home in Australia.
You cannot have a proper feeling for what is going right and what is going wrong if you are not on the spot. You miss the warning signs, the subtleties of human interaction.
I am quite sure that the string of unforced errors that AstraZeneca has made would not have happened had Soriot been on duty at HQ.
That is just one company and it is a shame. There is a much broader concern. The West is in the middle of a financial market boom: record share prices in the US, record house prices in the UK, and so on.
We all know the reasons for that. The tidal wave of money created by the world’s central banks has to go somewhere and that somewhere includes shares and property.
You can make a decent case in defence of these policies, arguing that we need to pump up the global economy after the devastation of Covid- 19. But I worry that too many people across the world are making decisions in isolation – sitting at home tapping away at their keyboards, or on endless Zoom calls, rather than talking to each other face-to-face in a measured, thoughtful way.
As far as financial markets are concerned, FOMO, fear of missing out, has become the dominant and corrosive driver. It may well be that the boom will run for some while yet. Indeed I expect it to do so until the central banks start to turn off the taps and interest rates start to climb at a serious pace.
But meanwhile there i s not enough reflection, not enough judgment, not enough questioning as to whether the herd might be heading towards a cliff edge. And you can’t have that reflection if people cannot meet each other and catch the subtleties of their thoughts.
That is why we need to get back to the office, and just as important to those coffee bars and pubs in city centres.
It will take time to figure out the best balance between working remotely and working in the office, and the latter will in any case change its nature.
Offices will be less a collection of work stations, more a club for people to meet and plan. But it has taken the reality of a year of compulsory home-working to appreciate the limitations of laptop life.
Whereas last summer many businesses were pondering whether they needed the expense of a plush city-centre office, now they are coming round to the view that they really do.
And that, for anyone who cares about the future of the great cities of the world, London, New York, Paris and so on, will be a huge relief.
We need to get back to the office... and to the coffee bars