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Doubts clouded hopes of a return to Labor Day office

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Labor Day has long provided a unique punctuation mark on the U.S. calendar, marking the first Monday in September as the unofficial end of the summer. After that day, crowded beaches, national parks and Hamptons restaurants calm down as children return to school and adults return to business.

But the federal holiday has taken on too much importance this year. Falling on September 6, 18 months a week from the World Health Organization declaring Covid-19 a global pandemic, Labor Day 2021 is being held by many companies as the time when employees who have working from home for most of that time should start working in the office.

This expectation, reinforced by rising vaccination rates in the country’s largest shopping malls, raises the hopes of the center’s office owners, retailers specializing in more elegant clothing and service providers from around the world. corporate catering to stomach strengthening and skin smoothing products valued by those concerned. as seen in person, rather than in a Zoom window.

At the same time, analysts have warned, the reloading of the country’s central business districts will also require such a change in activity that the impending expiration raises questions about whether the commuter infrastructure some cities may adapt over time.

The New York transit agency has cut 6 percent of its staff since the beginning of the pandemic, leaving it unable to provide a full service. This caused delays even though the metro system was still in operation 55 percent fewer people than usual this week.

The growing cases of the Covid-19 Delta variant are meanwhile cooling the enthusiasm of some entrepreneurs to bring their people together. Apple on Monday told staff it should delay its return to its offices from early September by at least a month, and warned that the date could move further back depending on the spread of the virus.

A natural transition

“It’s not like something magical happens on September 7,” Michelle Gass, CEO of Kohl’s, told the Financial Times. “It was more about giving people clarity and having this natural transition with kids [returning to] school. “

But the department store chain is far from alone in waiting for its office staff to return the day after the public holiday. James Gorman, executive director of Morgan Stanley, said last month that he would be “very disappointed if people didn’t find their way into the office” by the time of work, adding that the bank would still be flexible on at the frequency you expect people to be there.

He quoted Brian Moynihan, the executive director of the Bank of America as saying in late May that his bank’s goal was “to effectively get back to where we were in January 2020” in early September.

“We hear more and more in all markets that Labor Day is the goal,” said Paul Gaines, head of assets at Access, a real estate company with office buildings from Houston to Chicago. “It seems like the expectation is that most workers will return to the office at least part-time.”

U.S. office staff return to work after the workday

Albert Behler, president and CEO of Paramount Group, whose majority of properties are located in New York and San Francisco, noted that most tenants were planning a gradual return to office. But with vaccination rates above the national average in both cities, “this gives our tenants and us more optimism for a meaningful and safe return to office after September.”

Paramount’s offices are full in the summer, but remain “well below pre-pandemic levels,” said Behler, who said it was nearly impossible to predict where they would be in September.

Others have made such predictions, however. A survey conducted by the Partnership for New York City, which represents some of the city’s largest employers, found last month its members expected 62 percent of office workers to return by the end of September, even though only 12 percent were at their desks by the end of May.

“There is a big change of pace that must happen for sure; in New York we’re less than half way down, ”said Zach Amsel, director of insights for Earnest Research, a data analytics company that uses foot traffic in downtown Starbucks locations as a proxy for the speed of central business districts receding.

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Earnest data, collected from mobile devices, however, shows narrow geographical differences. While Starbucks locations near offices in downtown Miami and Los Angeles were 25 to 45 percent less busy in May than before the pandemic, those around New York travel centers like Penn Station and Grand Central Station were still down 70 to 75 percent.

Latest data from Kastle Systems, using swipes from access systems operating in 2,600 buildings, suggests office occupancy in the 10 largest metropolitan areas of the United States averaged 34.5 percent this week. Law firms have taken the trend, however, with a rebound in employment since the July 4 holiday taking their average to 55.7 percent.

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The return to school meets the return to work

Labor Day is still an important date in the sales calendar, an expiration date for which businesses hope to unload piles of jeans, sweatshirts and backpack-filling supplies for children for the back-to-school season. .

But it would be a “catalytic” moment this year, Joseph Scalzo, chief executive of Simply Good Foods Company, told investors about the snacks company earlier this month. Shelley Haus, Ulta Beauty’s chief marketing officer, also told analysts to expect “a return to school [season] like no one else. ”

These expectations were fueled by the Biden administration which sent the first tax credit checks for children to 35m families at the beginning of the month. “Consumers will have more money in their pockets than they expected.” This will drive up spending, ”Amsel predicted in Earnest Research.

But, unlike in previous years, retailers expect the jump back to school this year to coincide with parents also refilling their closets. “We’re excited about the upcoming clothing boom,” Gass said of Kohl’s, asking, “How many shirts do you need to be in a Zoom show?”

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Google Trends data offers an answer to this rhetorical question, said Nick Mazing, director of research at data provider Sentieo. Searches for “dress shirts,” the type of collared shirts still expected in many workplaces, are back to 2019 levels as workday approaches.

Interest is even stronger in Jox-smoothing wrinkle-smoothing bots, Invisalign tooth straightening kits and “tummy tuck” procedures, Google data show.

After months of interacting with colleagues only through a screen, Mazing concluded, “people are worried about how they look in real life.”


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