Subscriber OnlyEconomy

Three big questions for your working life in the wake of Covid

Smart Money: When, and how, will those working from home go back to work?

The pandemic keeps changing our expectations for the future of the way we work. A few weeks ago, for example, those who have been working from home may have anticipated a return to the office in September. Now, this looks in question due to the Delta variant. And, as the pandemic drags on, the huge gap between incomes and opportunities in the sectors affected, and the rest, continues to widen. Here are the some of the questions which lie ahead.

1. When, and how, will those working from home go back to work?

The Delta variant could delay the plans of many employers for a September office reopening. Much will depend on trends in the meantime, of course. But with cases rising and the vaccination programme not yet fully complete, big employers are waiting and seeing. One said he hoped that staff could resume in the office in September: “If they can have a pint or a meal inside on a Friday night, they can be in the office on Monday.” However, he said the return would be slowly phased in with distancing guidelines and staff working on a hybrid model. Some other big companies who have not yet committed to a firm date have said they will wait and see, with some expecting a delay into October or beyond. Many, too, will wait to see whether the Government guidance to work from home is changed or extended in September. A “ big bang” return to the office in early autumn now looks unlikely. And it is a measure of the uncertainty caused by Delta that it is still unclear what to expect, beyond hoping that full vaccination does allow a gradual return.

As well as the “when”, the longer the delay, the greater the question of the “how”. The hybrid model – typically involving two or three days in the office – will help to avoid crowded work settings. For some businesses and employees it will make sense . But the pandemic has shown that work can be divorced from location in many cases, using technology. Marc Andreessen, the founder of Netscape, has written that “ it turns out that many of the best jobs really can be performed from anywhere, through screens and the internet”. People working miles away can be just as productive as those commuting to work and living close to city centres, he wrote.

And think not only of the work now done online, but also the services we avail of, stretching well beyond shopping to tele-medicine, for example, and online learning. And in turn those providing these services can do so from anywhere.


So is the hybrid model really the way forward, or just a staging post on the way to more fundamental change? Is the three-days-in, two-days-out model the way forward, or just company bosses and office owners trying to evolve to a model which does not shift too far away from the past? How will commuting be organised if most people do return to the office?

A lot of things hang on the answers – not only how people live their lives, but the future of city centres and patterns of where we live and use public transport.Fundamental economic patterns may change – work by IBEC chief economist Gerard Brady has highlighted how working for home is an option for many in suburbia and in traditional commuter towns. but not so much in rural towns. All this has big implications for policy both at national and regional level.

A major American study from the National Bureau for Economic Research estimates that increased productivity due to eliminating commuting time is a significant economic and personal boost. It estimated that 20 per cent of hours would be worked in future from home, compared to 5 per cent before the pandemic, representing a really fundamental change.

2. The way workplaces are organised

It was always clear that vaccines do not offer 100 per cent protection. But with some people who have been vaccinated now getting sick, the issue of controls in officers and workplaces looks set to be at least a semi-permanent feature for the foreseeable future, despite what the UK is doing. Legal experts have pointed out for some time that in most cases employers cannot ask staff whether they are vaccinated. The Data Protection Commissioner (DPC) said in a recent note that this was also its view and that there was no clear legal basis for doing so.

This may disappoint some employers, who may have hoped to check vaccination status. The DPC has said that this is only reasonable in certain limited settings, such as frontline healthcare provision. However, its note said that the position could change depending on future public health guidelines. And so Government return to work protocols, when they appear, will be closely watched. In the meantime, it is clear that employers will have to consider distancing, ventilation and a host of other issues – and some are already employing antigen testing. Vaccinations do not provide the whole solution.

Finally, employees are likely to drive a lot of this, demanding that workplaces are safe and questioning the need for “presenteeism” – being in the office. In the short term, at least, what might be called “ commuter hesitancy” will be one issue. Many will want to avoid cramped bus or train journeys, even if they are vaccinated, at least while case numbers remain high. Many will ask employers – why can’t I come to work when it is needed? – for a meeting, training, or whatever – rather than signing up to be in Monday to Wednesday?

3. Mind the gap –The K-Shaped Recovery

A “K-shaped” recovery indicates some sectors taking off and other heading downwards. And it is appropriate for Ireland’s dual economy, as the multinational-dominated modern sector thrives but many domestic, consumer-facing businesses struggle.

Analysis presented in the Department of Finance's Summer Economic Statement showed how, remarkably, household disposable income rose by 5 per cent in Ireland last year, driven by income rises from heathy sectors and, crucially, supports such as the Pandemic Unemployment Payment (PUP). Basically the Government threw billions at the problem in a massive support exercise.

This worked in terms of supporting overall incomes. But while the PUP also provided vital support for those out of work, clearly many ended up worse off – typically younger, less well-off people, working in consumer-facing sectors , according to detailed ESRI research. Some households have been accumulating savings, while others did not have much savings in the first place and are now fearful about their job, or have already lost it.

As pandemic supports like the PUP are wound down, the gap will remain, or widen, between the better and worse off, particularly given the slow pace of reopening in some parts of the economy, notably hospitality. And of course better-off employees are more likely to be able to reap the benefits of more flexible working patterns in future – given the nature of their jobs.

Meanwhile not only the rules, but also consumer demand patterns will also have an impact on the sectors. Even when vaccinated, some people will not return to indoor dining, for now anyway.

There is better news too in the resilience of much of the economy and the strong jobs trend in other sectors, which will help some people find work. Data presented in the Summer Economic Statement show a clear K- shape in the early months of this year, with output in the information and communications technology (ICT) and manufacturing sectors up 19 per cent in the first quarter, while output in the so-called contact-intensive sectors – hospitality, retail and so on – fell 9 per cent. These sectors will rebound to some extent with reopening, but the Delta variant has put doubts over the pace of this. Vaccines are making a fundamental difference, but big questions remain.