While people in Asia are spending more time in the office, workers in the US and UK are not, according to a new report from XY Sense, a company that uses sensors to track office occupancy in more than 40,000 workspaces.
While office space utilisation – the share of used spaces within an office out of all available space – in the Asia-Pacific region grew 10% last quarter to 41%, that rate stayed at 28% in North America and declined in the UK. The so-called return to the office has been much slower in the US than abroad, partly because of factors like longer commute times, larger homes, and cultural individualism there.
Office utilisation in North America is about half what it was pre-pandemic, according to XY Sense.
Source: Sherwood
When people do go into the office, meeting spaces are much more in demand. On average, time spent using collaborative spaces like conference rooms (4 hours a day) was 54% higher than individual desks (2.6 hours), and lack of communal space has become a big pain point for companies. Meanwhile, XY Sense found that half of office desks were utilised for less than one hour per day, while 30% were never used at all.
XY Sense data tracks with a number of other indicators showing office utilisation and remote work are pretty stable in the US.
Flex Index, which surveys employers about their office requirements, found that the structured hybrid model, where employees are required to come into the office a certain share of the time or on specific days, has remained dominant. Currently, about 38% of US companies opt for it. Some 33% require full-time in the office, while 29% are either fully remote or leave the choice of whether to come in, to employees. That still leaves a lot of variation in how much office space is actually necessary.
The US Bureau of Labor Statistics data showed that the portion of Americans who worked from home some of the time jumped up last year to 35%. WFH Research’s ongoing survey of Americans has found that working from home has been pretty stable since last year, with about 30% of paid full days worked from home.
All of this has meant that office needs are only a portion of what they once were. As such, office real estate continues to struggle as vacancy rates approach 20%.
The above data is US-centric, and the situation in Australia is not nearly so dire. New data from CBRE for the first quarter of the year, excluding the quieter December and January months, shows Australia’s CBD office occupancy rate averaged 76% of pre-COVID levels in Q1 2024, up from 70% in Q4 2023 and 67% a year ago.
CBRE’s Australian Head of Office Research, Tom Broderick, noted, “Companies and employees alike are acknowledging the importance of face-to-face collaboration and the synergy it brings to their operations. Every major CBD market in Australia has recorded increased occupancy rates over the past 12 months, with the smaller markets of Perth and Adelaide having rebounded impressively, nearing pre-pandemic levels on peak days.”
Source: CBRE Research
