> It takes a lot of exercise to burn off excess calories, and virtually no effort to simply not consume them.
> and virtually no effort to simply not consume them.
I don't think this is true. The executive function required to manage the dopamine cycle that food generates is incredibly taxing. I honestly think this is a result of our food systems being incredibly optimized to drive purchasing decisions...
Separately, this reminds me that I should eat some veggies.
Disclosure: I live in SF and co-founded www.daybreakhealth.com which is fully remote. I am, 100%, part of why this tower, and others like it, are empty.
> "[...] Mayor Breed, who in an interview earlier this year said that “for this city to be thriving, we need people back in the office.”"
This is such a frustrating statement. If I were going to make this point I would say "for this city to be thriving in its current incarnation, we need people back in the office." Sadly, the mayor, as espoused above, and at least one city supervisor (Matt Dorsey¹), simply do not seem open to the rebirth necessary to make this city thrive again.
In 2020, in preparation for the debates with my co-founders on whether we should establish a fully-remote or fully-in-office culture I spent a lot of time trying to understand what remote work would mean for the Silicon Valley Business Cluster² and San Francisco in particular. I built a working theory for how Silicon Valley functions as a business cluster, San Francisco's role within that cluster, and San Francisco's city finances. Based on that working theory I built a cone-of-possibility broken out into four main scenarios that looked something like this:
* Theory 1 - Remote Work is a Pandemic Only adventure. Workers will exit the major cities, first in fear, then in pursuit of better personal finances. The pandemic will end, and the functions that drew workers into the city in the first place will reassert themselves. Workers will flock back to business clusters, the cities within them, and the offices in which they used to work.
* Theory 2 - Remote Work isn't sustainable for workers in most industries. Workers will exit the major cities, first in fear, then begin to hate their new normals. They will return to the city, and to the office, possibly before the pandemic ends.
* Theory 3 - Remote Work in Software is here to stay. Business Clusters that relied less heavily on Software workers, such as LA's film cluster, or the Boston / Cambridge BioPharma cluster would see a return to the office. Yes, they would have a lower over all demand for office space, but we'd be looking at a mid single digits³ reduction. Meanwhile San Francisco's office buildings would become a ghost town. This reduction in worker need for office space in SF would drive a cascade collapse in its office districts. First the streets are empty of pedestrians, which collapses all the local retail, which draws in more of the unhoused, which trash the place due to lack of supporting infrastructure, which drives up the cost of keeping the streets from looking like the Tenderloin. All the while, commercial leases lapse or go up for sublet in alarming volumes. These forces of reduced software workers, reduced retail spend, and reduced office rents combined to create a financial collapse in SF's city budget, anywhere from 10 to 20% of city revenues. In the worst case, with vacancy reaching into the 70 or 80% range, SF's budget craters by as much as 30% forcing a material reduction in city services which exacerbates the unhoused problem, creating a vicious cycle.⁴
* Theory 4 - Remote Work is here to stay for all knowledge work. In this scenario, all of the financial woes that play out for SF in Theory 3, play out for any city that has a major knowledge worker dependency. The breadth of the commercial real estate collapse begins to threaten the solvency of many banks. The workers, faced with the isolation of in-home work begin to branch out socially in their evenings and weekends. We see a resurgence in hobbies that bring people together.
By my understanding we're currently somewhere between Theory 3 and Theory 4. I think my theories were a bit aggressive on the potential collapse scenarios, but I'm seeing enough of what I predicted to feel comfortable in my reasoning. With that in mind, let's talk about how this ends: The lack of demand for office buildings in many cities results in the collapse of the system used to finance them. Banks and the hedge funds, REITs, pensions and other debtors take a monstrous haircut as the buildings are sold at huge (60%+) losses. A few will make it out OK, having held the buildings long enough to have turned a profit, but none of them walk out of this with their financial projections intact. The buyers of these buildings are, predominantly, in it to blow them up. The buildings are torn down and replaced with purpose-built housing and specialty offices (think biopharma or cultured-meat infrastructure).
This article, and 350 California Street in particular, represent the pin hole in the proverbial dam. I wait with baited breadth.
¹. I spoke with Dorsey for several hours during his District 6 Supervisor election campaign on this topic as I was living in his district. His views can be concretely summed up as a deep belief that tax policy alone can get office workers back. He seems unable, or unwilling, to distinguish between office tenants and office workers.
I think the driver of Theories 3+4 will be that with high interest rates we are heading into a recession. A major driver of this recession will be a massive collapse in commercial real estate and CMBS. As the recession really gets underway then the back-to-office movement will flip on its head and companies will start to really get aggressive about cuttings costs and shuttering offices in order to survive, which will only accelerate the commercial real estate collapse even more.
The headcount reduction in tech so far has been literally nothing. Mostly that was just readjusting for the post-pandemic hiring explosion in tech.
It'll still be 6-12 months though (at least) before higher interest rates really start to bite. There's $162B in commercial real estate securities maturing in 2023 which is going to be the first real substantial detonation in the economy.
That should set us up for having a really horrible economy in 2024, we'll probably be diving into the recession or hitting the bottoms around Nov 2024.
It does seem to vary. The few times I've commuted into Boston over the past six months or so both traffic and transit usage seemed to be pretty much back to pre-pandemic levels as was pedestrian activity within the city. SF seems to be at least something of an outlier presumably because tech is something of a bubble.
In general, I'd observe that there's been much more of a reset to pre-pandemic norms than many anticipated. But SF could well end up being something of an anomaly--which would be especially bad news for SF given it may not be a broad-based crisis that the government at the national (or maybe even state) level is going to be especially concerned about.
> In general, I'd observe that there's been much more of a reset to pre-pandemic norms than many anticipated.
I haven't traveled well enough recently to agree or disagree, but this matches my reading, so I'll take your argument.
> But SF could well end up being something of an anomaly--which would be especially bad news for SF given it may not be a broad-based crisis that the government at the national (or maybe even state) level is going to be especially concerned about.
Yeah... That's why I think we're somewhere between Theories 3 and 4. I was really hoping that the city supervisors would see that and start shifting SF's office core to be a more desirable and exciting place by reducing the barriers to entry for new brick and mortar businesses. Think more streets shut to cars, more bike only roads, massively more efficient and cheaper stall and cart permitting along with expanded areas of operation. Roll this together and you could essentially crawl the existing temporary street markets around the Ferry Building into the urban core. This would also provide an avenue for businesses to start and grow to fill the empty retail in the buildings around them, much the same that food trucks have become a stepping stone to brick and mortar restaurants.
>I haven't traveled well enough recently to agree or disagree, but this matches my reading, so I'll take your argument.
Yeah, it's not just return to office. I was at KubeCon in Amsterdam last week and it was the largest KubeCon Europe ever with 10K in-persona attendees. Add the 2K who wanted to go and couldn't get in and it was almost 2x the attendance of KubeCon in Valencia a year ago. (And that's in an environment where a lot of tech companies have cut back on travel spend.) So, nope, nope, conferences aren't all going virtual.
And, although I don't have numbers, I'm pretty sure that a lot of the food and grocery delivery and other services that really soared during the pandemic have probably largely returned to earlier levels.
That seems unlikely, since annual averages are about 50% of pre-2020 office occupancy.
Public Transportation data also shows volume at roughly half of pre-pandemic normal.
However, commuter rail has recovered less than other modes, so if some of those people are now driving to their office instead, then they will be making traffic worse than it would have been at an equivalent pre-pandemic office occupancy volume.
>However, commuter rail has recovered less than other modes, so if some of those people are now driving to their office instead, then they will be making traffic worse
There's probably some of that. At one point I took commuter rail after traffic seemed as bad as ever and it was pretty empty. But last time I took commuter rail in during December, it was back to standing room only again from about Waltham. (That said, I think the schedule is still reduced relative to pre-pandemic which both skews the perception of how many people are taking the train and makes the train a less attractive option.)
I'm honestly not sure though how to square the number of cars apparently on the road at rush hour with reduced office occupancy. Some of it is probably day sensitivity (more people commuting mid-week than Monday/Friday) given that occupancy--depending on how it's measured--than actual office vacancy which is high but at 18% not that high.
But I don't understand why people make such a fuss about some cities losing prominence and eventually crumbling from a previous period of wealth. This happens as history and technology progress.
I don't see how wealth is lost when it is just being redistributed. The workers didn't disappeared, they are just living elsewhere, bringing business opportunities and improving across many different places. Perhaps it will be healthier for the economy as a whole than having only a handful of cities as beacons of investment.
> I don't see how wealth is lost when it is just being redistributed. The workers didn't disappeared, they are just living elsewhere, bringing business opportunities and improving across many different places.
If I'm recalling the theory of it correctly, the whole reason Business Clusters exist (and form) is because there is, essentially, value in being together. Or at least, there's economic value in reducing the logistics required to move goods from one part of the value chain to another. For this reason I don't suspect we'll see the dispersal of manufacturing business clusters.
A huge part of my digging was trying to understand whether this applied to Silicon Valley or not. I decided that it did, but not because of the software, instead it was because of the VC + Startup relationship. VC's want to meet the people they're giving millions of dollars to and startup founders want to meet the people they're giving control (or massive influence) of their company to. It remains to be seen whether Zoom satisfies this need or not.
> Perhaps it will be healthier for the economy as a whole than having only a handful of cities as beacons of investment.
It might. Technology has changed dramatically since we last had material distribution into the suburb and rural areas of the nation. Maybe that will overcome the benefits of centralization.
Traditionally VCs centered around Sand Hill Road wanted all of their portfolio companies within easy driving distance so that they could attend at least two in-person meetings per day. Obviously that requirement has started to break down.
Proximity to universities has also been a key factor. Silicon Valley has two world-class research universities plus numerous second and third tier schools nearby to act as sources for new technologies for commercialization.
In the early days proximity to Moffett Field and NASA Ames also helped to launch the Silicon Valley innovation engine. There was a lot of cross pollination of people and ideas with military and aerospace.
I understand centralization in the sense that you so aptly put in bringing benefits in a very similar vein of economies of scale.
A bunch of businesses in the same city benefit from shared infrastructure (in a broader sense) and a large pool of labor.
But when we specifically talk about knowledge work, where the output is not a physical good (and even when the output is a physical good but that requires a lot of knowledge work before it can be produced) does the centralization even make sense? Technology vastly expanded the possibilities in terms of infrastructure and pool of labor. The limits now may be more in terms of the cultural shift and government regulations.
It's because politician's focus is to keep themselves employed and re elected, with entirely short term focus. They have special interests from the wealthy who try to influence policy, and usually wealthy people are in a system of making income off of others (i.e ownership).
To your point, it must just be a modern phenomena of the 24/7 news cycle and internet to get loud voices out there faster. Because if you look at the rust belt and places like Ohio that were thriving industrial cities you can clearly see that places come and go. Detroit is another good example of a new less glamorous normal. There are certain benefits of density w.r.t to economics and such but a river runs its course, if you try to mess with it one way it will eventually change in another.
Don't want to see them die at the expense of people that don't want to live there?
Remember, what is being discussed here is the fact that with remote work, commercial real state is low in demand. So we are effectively talking that workers prefer not to live there, given a choice, and the companies are fine in employing them remote.
The place didn't die. It's still there. But many people prefer to live elsewhere. You can remain there if tou like it so much, no one is stopping you.
I don't think you were too aggressive with theories 3/4 at all. The impacts from the pandemic, the Federal Reserve's reckless monetary policy, Congress' inability to figure out how to deal with the US debt, and Wall Steet's continual pursuit for profits are all pointing to an economic disaster. We're just continually spiraling into the calamity to come and everyone is in a petty blame game and culture war.
I really like Tyme for time tracking. It works quite well for me, is dirt cheap, has a great UX across both my iphone and my macbook and gives me flexibility around start and end times so it's easy to keep it roughly accurate.
That said, I don't use it for detailed task observation. For example while writing this my "management" timer is running and this is definitely not managing my team. I use it for directionality more than anything else.
I'm using gtimelog for this. Similarly, I don't need a minute-precise account of my time, but it helps to get a rough overview where my time is going - system maintenance, incidents, project work, organization - or what time certain infamous internal projects really consume using the tags.
Short, but interesting little piece. I specifically enjoy how it's not just a rant about how the Player / Coach concept is bad. It's also an explanation for how to make the Player / Coach concept work well.
> Saving face and preserving "decision making credibility" means that taking advice is simply not on the cards for a large portion of the middle management class.
While I'm happy to admit that this construct may be true in practice; it is _deeply_ infuriating that so many people's calculus nets out in this manner. It's infuriating to me, primarily, because I simply don't understand. By my understanding, "decision making credibility" comes _exclusively_ from *being right*. If you're optimizing for this metric, then how you get there should be an almost irrelevant footnote.
Yet here we are; with a non-trivial percentage of managers coming to the conclusion that the correct answer is to not take advice.
Decision making credibility is simply not anchored in "being logically correct."
It's anchored in the ability to consider the needs of the tribe appropriately.
Leadership credibility in human society is mostly anchored via your track record of emphasizing with the needs of a Dunbar's number sized tribe.
Empathy, not logic, is the KPI our brains are tuned to. Empathetic leaders emphasize data collection, logical ones make decisions using that data. Evolution has optimized for empathy.
The core problem with large companies is the middle management buffer grows large enough that it forms a subculture which drives decision making.
Plus, institutions of 1,000, 5,000, 10,000, all have their "local" rules of detailed management
know-how. Add it all up, and you have a problem that's just as thorny & knotty as any engineering problem. Requiring just as much detailed expertise.
In any large company, everything is so complex and connected with each other that it's close to impossible to hash out the actual output (positive or negative) of any big decision. So, decisions are not based on merit because it's impossible to reason what is good what is not. Instead, there's a leader who has some kind of vision and the company follows that vision, for better or worse.
I've been exploring this concept a bit at my startup for our B2B offerings. Where I've landed is a robust set of feature toggles that Sales and Account Management configure. Within the confines of your Microsoft Word toolbars analogy; since the software we offer is similar to SaaS and delivered via a web browser this effectively means we can "hide" the toolbars that the client isn't interested in.
This is all pretty early days, but my hope is that we can iterate the core "have feature toggles" concept to the point where we have the ability to turn functionality and function accessibility on across many verticals. I hope that one day internally we can configure things a per-customer and per-user-persona basis. I also hope that one day we can expose some of those switches to admins and/or everyday users, possibly with paywalls or other strictures.
We've been doing this for 25 years in our desktop software. Every new feature is behind a checkbox on a "features" screen. This screen is in the program, so users can turn things on and off, but typically its set by one of our staff during the installation phase [1].
The upside is a clean interface which helps during training, support, and day to day use.
The primary downside is discoverability. Occasionally customer needs change and some assume "the software doesn't have that feature" rather than call us, or check online.
That's a problem best solved with good communication, but that can never be perfect.
[1] this is in the B2B space, and has a proper sales, install, support cycle.
It's not just about the users. As the software becomes more complex it's hard to change/iterate on, hard to find bugs/fix things, hard to reason about etc. And the difficulty seems to rise non-linearly.
How does that scale for enablement, training materials and documentation? Will be very confusing for users if the material shows things that are not in his UI.
> FTX worked fine: People liked its technology, and it seems to have made money. The problem was in its balance sheet, which was full of snakes, and its governance, which put all the snakes there.
> You are paid based on how difficult you are to replace. Hence the location based pay
You're partially right. Pay is very much about how difficult you are to replace. However Location in many industries is no longer the dominant input.
Location is the dominant input in an office-centric model, but isn't in a Remote model. In an office centric model, the company would have to pick where to locate the office and that location would have a "commute radius" in which they could effectively expect their employees to willingly come in to the office from. This meant that any physical office's "commute radius" was effectively its talent pool.
So if you put your office in a high cost of living area, you now have to pay enough for people to live in that area or be willing to commute in from lower cost of living areas. This reality is the foundation for the "location based pay" detente between Labor and Capital.
It's worth noting that these things are also interdependent and self reinforcing. Eg: An area (like Silicon Valley, or any other business cluster) has a higher density of talent, which is more attractive to employers, which means more employers want to be in that area. More employers means more competition for that talent, which drives wages up. As those wages then filter into the market you see the price for supply constrained necessities (houses typically) go up, and often times that will drive cost of living up.
In a remote work world, this entire cycle is dramatically disbursed and the core foundation of the "location based pay" detente between Labor and Capital is shattered. What this ultimately means is that Capital no longer pays for Talent + Location + Competitive wages within that location. Instead they pay for Talent + Availability (timezones mostly, but internet connectivity is in there as well). This should, in theory, drive a larger talent pool, which, depending on demand for that talent, might lower wages in a given "Availability". If it does, then the cycle starts anew as Employers start to seek out ways to be in that "Availability".
The big question one needs to ask is whether there is enough demand to suck up all the talent within the workable "Availabilities". If there is, then wages stay the same or go up. If there isn't, then wages go down.
My personal opinion is that any company doing "location based pay" in a remote work world is shooting themselves in the foot (unless they have market power in those locations).
Everything you've said is logical, but the radius you are describing is multifaceted. There are regulations, inertia, cultural and ideological factors, and all sorts of other considerations that come into the capital vs. labor struggle and recreate the radius even with remote technology.
In our current world, American salaries are inflated for macro reasons, but the shift you are describing may very well flatten the skilled salaries for currently wealthier regions and increase those for poorer regions.
> Everything you've said is logical, but the radius you are describing is multifaceted.
No disagreement there.
> There are regulations, inertia, cultural and ideological factors, and all sorts of other considerations that come into the capital vs. labor struggle and recreate the radius even with remote technology.
No disagreement there either.
> In our current world, American salaries are inflated for macro reasons, but the shift you are describing may very well flatten the skilled salaries for currently wealthier regions and increase those for poorer regions.
Would you happen to know of an example of "tag-along rights" that I could bring up at my next board meeting? I'm curious what the implications of such a thing would be and having sample text would be incredibly valuable.
The Fuzzy Pumper Barber Shop. WTF happened to jingles? This one was dead and buried in my head until just now.
Edit: see the sibling comment, they gave a link. Brother need a little off the top.... and I never even had this or most of the crap whose jingles are still in my head.
I assume it means https://en.wikipedia.org/wiki/Fuzzing which in this context would be trying the idea with multiple input parameters until one works best. Kind of like neural networks.
> and virtually no effort to simply not consume them.
I don't think this is true. The executive function required to manage the dopamine cycle that food generates is incredibly taxing. I honestly think this is a result of our food systems being incredibly optimized to drive purchasing decisions...
Separately, this reminds me that I should eat some veggies.