Work from home is the new normal. It has become the ultimate solution for all the corporates owing to the technological development which has happened. Most offices were closed due to the coronavirus pandemic and this is why various other sectors of the economy were witnessing a counter effect. When one sector of the economy falls, it leads to a chain reaction with all the other sectors. It is impossible to just restrict this fall to a specific area. Let us talk about all the sectors that will have a shaken up effect if work from home becomes the new normal:
Commercial leasing: The commercial leasing sector will face the biggest fall of the decade. People will stop leasing out office spaces and will stop paying money for it. The government has also said that the employees must work from home as much as possible in order to contain the spread of the virus. Various property consultants are saying that their corporate real estate business will go down. If this sector is thought about at a higher level, for the offices which cannot have work from home, they will have to hire more space and pay more amount for it to adhere to the social distancing norms. This two side effect makes it very difficult for this sector to predict their future. But it has been observed that social distancing will prevail for the next two years and the sector will dwindle down as no amount of expansion of one office space can lead to the high intensity of revenue plunge.
Co-working spaces: co-working spaces are the future of tomorrow. The basic concept of co-working space comes up when a multiple numbers of people share one single space and call it an office. You are allotted a desk and a computer. That is your office. Co-working spaces will now start falling down and the whole concept will become orthodox. People will not share their space with others and will keep themselves in closed cabins instead of open spaces. The price of health will be more than any other price. And rather than the offices, work from home will prevail. Work from home might have affected the productivity of some employees but they need to gear up because this is the new way of living. These spaces are considered to be cheaper and more flexible in terms of the time period of rental agreements. With the large amount of pressure being built on businesses, it might be observed later on that the coal working space price will increase.
Cab Sector: Major revenues of Ola and Uber were increasing because of the office going people who used to travel daily. Various offices provide free cab facility to the employees. And even if not a free cab facility, people used to take cabs a lot for there to and fro to the work premises. The revenue of Ola and Uber has gone down by a huge percentage because of the work from home concept. They have witnessed huge losses in India and have fired various employees. The cab aggregators of the country were solely dependent upon corporate structures for their income. With the corporate structures changing, the revenues for cabs will also change.
Change of market dynamics: traditional office spaces are a liability for both the tenants and landlords. This is difficult for both parties because the tenants have to pay the rent and the landlords are not getting the rents because of a shortage of income. The market dynamics will shift 360°. The demand will be subdued over the next few quarters. The government is focusing on economic growth but the people are well aware of the consequences of economic growth with respect to one’s health. People are themselves not going out and are trying to stay indoors. Many business verticals and dynamics will change thoroughly after this.
Travel sector: People believe in traveling and closing the deals in physical form. With the advancement of technology and the pandemic looming over everyone’s head, people will resort to closing the deals on video calls and email. The travel industry with regards to transportation will see a huge decline because corporate travel covers a huge chunk of their revenue. Even more than that, a normal person will not prefer to travel for the next few years till the time the pandemic has completely died down. The travel sector will have a dual effect. If the people are not earning well, they will not have enough savings and they will not go out for traveling with their families for holidays. The whole concept of the travel industry falling down seems very true right now. Honestly, if people are stuck in their homes, why will they spend more money than what is needed?
Hospitality sector: when employees go for meetings, they are provided with hotel stays at top-notch hotel chains by the companies. With no employees going out now, all the corporate bookings for the hotels have gone down to 0 and the revenue for the hospitality sector has reduced considerably. There were huge conferences being done all over the world by business tycoons which used to fetch a lot of revenue and used to boost the economy. All these events have officially been canceled and the hospitality sector’s revenue seem to be very bleak in the near future. The revival of the sector is next to impossible right now. More than 200 million jobs are lost in the travel and tourism sector with regard to hospitality.
The pandemic has been a major game-changer for all the sectors of the economy. Work from home was a concept that was not accepted by the Indian companies but now they are promoting it. Companies can actually save a lot of revenue on office space occupancy and other resources with work from home. It can be a productivity enhancer if the employees use it properly. All the time spent on the daily commute can be used in a productive way and also it can improve employee well-being.