What is the cost of working from home?
As many companies continue to implement work-from-home (WFH) policies, the hustle and bustle typically associated with central business districts (CBD) in many cities around the world has been conspicuous by its absence.
For Sydney’s CBD, the lack of business activity mirrors that seen in many other cities – and it is coming at a hefty price tag.
According to Terry Rawnsley, an economist at SGS Economics and Planning, the direct cost of pandemic restrictions, which are forcing employees to work from home, will cost Sydney’s CBD AUD$7 billion (US$5 billion), the brunt of which will be borne by the hospitality services, the arts and retail.
Additionally, the lack of interaction between the thousands of “knowledge workers” – such as finance, professional services, IT, marketing and media – who gathered in the CBD on a daily basis before the pandemic will take an additional AUD$3 billion (USD$2.2 billion) toll on productivity, Rawnsley highlighted.
Sydney’s CBD generated AUD$140 billion (USD$102 billion) in 2019, approximately 7% of Australia’s GDP, and 20% of the state’s output. Expected to generate more than AUD$142 billion (USD$103 billion) in 2020 pre-pandemic, the growth forecast has now been slashed to AUD$132 billion (USD$96 billion).
With the significant role the Sydney economy is expected to play as the Australian economy struggles to recover from the pandemic, there have been calls to make the wearing of masks mandatory.
This measure, it is hoped, will encourage workers to return to their offices, and feel safer in taking public transport.