25 Aug Google, if you want your employees to come back to the office: Show Them The Money!
One of the hottest sub-topics to emerge in recent weeks in the “Return to Work” discourse is “remote worker pay cuts,” specifically those proposed by Google that vary by urban, suburban, and more rural locales.
They kind of remind me of that World War I Top 40 hit, “How Ya Gonna Keep ‘em Down on the Farm (After They’ve Seen Paree?)” – in reverse. Of course, the song was referring to Uncle Sam conscripting farm boys and sending them off to war in France, only to experience the Big City, “liquor, jazzing around, [and] painting the town.”
Fast forward about a 100 years, and few of today’s tech stars were raised on farms, and if they’ve been working in tech’s mega centers in Silicon Valley, Silicon Beach, the rest of the Bay Area or Orange County, chances are excellent they’ve had lots of experience in megalopolises, liquor, jazzing around, and painting the town, along with the traffic jams, high parking fees, and higher rents, that come with working in ultra-urban environments.
While it wasn’t Uncle Sam that changed their environment overnight, it was the government.
When California Governor Newsom issued “shelter-in-place” orders, shuttering the State on March 19, 2020, I understand that immediately, young engineers and software developers emptied out of their cubicles and cramped City-quarters to head East: some went to Austin, others to Nashville and Charlotte, Jacksonville and Denver, even Sacramento rounded out the Top 15 areas with “net inflow of tech workers.” OK, so they’re not exactly farm-towns, but, according to RENTCafe, this month, the average monthly rent for an 865-square-foot apartment in Austin is $1539 (up 9% YOY), compared to the $2933 tab for an 825-sqft apartment in Mountain View (down 7% YOY), or $3035 for a 749-sqft apartment in San Francisco (down 11% YOY). Hmm, a bigger place for roughly half the rent?
In addition to larger quarters, and virtually zero commuting time and parking fees, many tech workers are finding they’re just as productive for their employers – plus they’re really enjoying their newfound “life-work” balance.
If Google sincerely wants to bring workers back to their campuses, rather than threatening their 135,000 employees with 5-25% pay cuts, depending on how far away from their offices they’ve moved, they might consider pay raises for those who return to live closer to the mother ship.
Back in the 1980’s, my mother worked as a secretary in the Western-Pacific Region headquarters of the Federal Aviation Administration. I remember being surprised to learn that, because she lived in Inglewood – 5.3 miles away from the FAA Western HQ, in El Segundo, she was given a “locality pay” bonus, in recognition of the fact that the cost of living was higher there than in Palmdale, for example. (BTW, just like Google, at the time, the FAA bused employees to work, specifically from the Palmdale aerospace center, some 70-mile distant.) As an example, today an 832 sqft two bedroom, 1 bath townhouse is for sale in Palmdale for $204,900. And, while it’s not on the market, Redfin estimates the value of the 800 sqft, 1 bedroom, 1 bath house in Inglewood, that my mother formerly owned – and in which I was raised, at $649,078.
Frankly, Google – and others demanding near full-time return to the office – could probably achieve the same desired cost-cutting results by providing a modest pay raise to those willing to return to its various urban quarters, hold the rates they’re currently paying to their telecommuters, and save the recruiting fees needed to replace the current Googlers who’d just as soon jump ship to companies like Twitter and Reddit which will allow their employees to work from anywhere, even a 5G-connected farm.
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By Mimi Grant, President, Adaptive Business Leaders (ABL) Organization – Round Tables and Events for CEOs of Technology and Healthcare Companies