Office Attendance Hits Pandemic High, Intel and Workday Join Firms Planning Layoffs, Worker Pay Grow
What You Need To Know To Start Your Day
By: Lou Hirsh
Austin, Texas, led nine other cities for office attendance in a closely watched barometer, in which metro regions averaged at least 50% of pre-pandemic attendance for the first time since March 2020. (Josh Putman/CoStar)
Office Attendance Hits Pandemic High
Large-city office attendance reached a pandemic high, with the average of 10 regions tracked by Kastle Systems topping 50% of pre-pandemic levels for the first time in the week ended Jan. 25.
“Workers in cities across the nation have returned to the office in greater numbers than ever before,” researchers at the security technology firm said in a statement. Kastle Systems reported its weekly “Back to Work Barometer,” based on anonymous keycard data from office property clients, rose 0.9% from the prior week to reach 50.4% in the latest tracking.
The Falls Church, Virginia-based company said the latest weekly increase was broad-based, with seven of 10 cities rising or holding steady from the prior week. The San Jose metro area, home to California’s Silicon Valley, remained at the bottom among barometer regions but posted the steepest rise from the prior week of any in the latest report, increasing 2.9 percentage points to reach 41.1%.
Office attendance has been steadily rising since the start of January following an expected holiday plunge, but most major U.S. cities remain below 50% of pre-pandemic levels.
However, Kastle officials noted that all cities in the barometer topped 40% in the latest tracking, the first time that has happened since the pandemic started in March 2020.
Austin, Texas, led the latest attendance rankings as it has for much of the pandemic, hitting its own pandemic high of 67.7%. It was followed by Houston at 60.3%, Dallas at 53.5% and Chicago at 50.6%.
Intel, Workday Join Firms Planning Layoffs
Chipmaker Intel and cloud-based business services provider Workday have joined a growing list of companies announcing planned layoffs in the early weeks of 2023, most of them in technology.
Santa Clara, California-based Intel plans to cut 343 jobs at its Folsom campus near Sacramento, according to required advanced-notification filings with the state employment department. A company statement this week said Intel was “focused on identifying cost reductions and efficiency gains through multiple initiatives, including some business and function-specific workforce reductions in areas across the company.”
Pleasanton, California-headquartered Workday said Tuesday it plans to cut its workforce by approximately 525, amounting to about 3% of its total global worker base. The company said in a statement it still plans to continue growing its headcount later in the current fiscal year.
These are the latest of several layoffs announced in recent weeks as companies respond to declining consumer demand and inflationary conditions affecting operations.
The Wall Street Journal reported Monday that a total of at least 25 companies have announced global layoffs totaling more than 60,000 just in the early weeks of 2023 — the bulk of them in technology, but also large numbers in financial services and manufacturing.
Worker Pay Growth Slows
Wage growth remains steady in a historically strong U.S. employment market, though the pace of that growth has been slowing, according to government and industry tracking.
The Labor Department reported Tuesday that wages and benefits grew by 5.1% from a year earlier in the fourth quarter of 2022. Growth from the prior quarter was 1%, down slightly from the third quarter’s 1.2% growth rate.
Employers are generally keeping raises coming to compete for talent in a climate of 3.5% unemployment, but small businesses are seeing an easing of hourly wage inflation. The latest monthly small-business survey from payroll services provider Paychex and consulting firm IHS Markit, gauging companies with fewer than 50 workers, showed wages growing 4.66% from a year ago in January, the lowest annual growth level seen in a year.
January’s growth rate from the prior month was 2.88%, the first time the month-over-month figure fell below 3% since 2020. Wage growth declined during January for all industries except leisure and hospitality, which saw growth of 6.82% for the month. “Our small business wage data indicates that wage gains are moderating, as has been the aim of monetary policy by the Fed,” IHS Markit chief regional economist James Diffley said in a statement Tuesday.
Paychex CEO John Gibson said the easing of wage growth has helped small businesses make gains in hiring, after many struggled to attract and retain workers over the past two years. “The wage index also shows that employees of small businesses are increasing their hours worked to increase their earnings,” Gibson said.