Offices have just 10% occupancy on Fridays
Mental health issues exacerbated by loneliness due to remote working impacts more than a third of employees
Irish employers are appealing to jobseekers that favour new working arrangements, as jobs offering hybrid and remote options has increased by 43% in the last 12 months.
And it’s having a major impact on cities in Ireland. According to research published by Savills and the Dublin Chamber commerce body, offices in the main business district in the capital city have as low as a 10% occupancy rate on Fridays.
Looking back to pre-pandemic times, the week-long occupancy rate would typically sit between 91-100%
So why then, at a time when finances are pinched and real-estate prices are astronomical, are business continuing to lease this “grey space” – which accounts for about 32% of all available supply in Dublin – despite it not being utilised?
Moira Grassick, chief operations officer at Peninsula Ireland, says, “We believe this could be down to several factors.
“The wave of recent job cuts at large tech companies including Twitter and Salesforce may have intensified the situation but, considering the massive shift in the way we work over the last three years, it hasn’t been reflected proportionately in the office footprint. Only 17% of businesses may have opted to decrease their office space, but 7% have added to it.
“A recent survey indicates that nearly half of Irish businesses require employees to spend at least two or three days in the office each week, suggesting businesses are apprehensive about moving to a permanent fully remote model.
“Of course, whilst hybrid and remote working certainly has benefits such as improved work-life balance and reduced commuting costs, there are several downsides to it that perhaps employers are trying to address. 41% of organisations reported increased challenges with respect to performance management in 2022. Additionally, mental health issues exacerbated by loneliness due to remote working impacts more than a third of employees.
“Perhaps the fact that so many businesses are retaining office spaces despite their low level of usage points to a future return to the office if these issues cannot be ironed out. Employers may not be entirely confident that remote or hybrid working practices will be a permanent feature in the future of work.
“Peninsula conducted a survey at the start of this year, that showed just one-quarter (27.7%) of Irish businesses have made some form of flexible working a permanent feature off the back of the temporary measures brought in during Covid-19.
“Given the exorbitant costs of real-estate in areas of Ireland, particularly in Dublin, holding onto office space could indicate that businesses are looking to supplement their return by sub-leasing these space to start-ups.
“Or they could be looking further ahead, signalling a long-term goal to grow and employ more staff, thereby painting perhaps a more positive outlook for the business landscape.
“As we all know, the world of business can flip at a moment’s notice, so perhaps employers are feeling things out before making any hasty decisions.”
