After COVID-19 sent millions of workers to their homes in 2020 and the delta variant this summer snarled some return-to-office plans, the omicron variant’s emergence may prompt company executives to go back to the drawing board yet again on when their workers will physically return.
A lot remains unknown about the latest variant of the virus that causes COVID-19, which the World Health Organization flagged Friday as a “variant of concern,” including how much existing vaccines can counter this version of the virus and how the variant will impact the economy.
But here’s a bet with good odds: the variant is at least a “hiccup” in the country’s return to office plans, according to Wells Fargo analysts. “At a minimum, Omicron slows down return-to-office,” they wrote in a Monday investor note.
Wells Fargo WFC, -2.81% itself is one of several high-profile companies that was planning on a January 2022 return to the office. The bank was initially aiming for a September 2021 return, but the delta variant upended those plans.
There’s no change in the bank’s return to office plans right now, a company spokeswoman said Monday, “but we will continue to follow the science as we have from the start. Our No. 1 priority is the safety of our employees and our customers.”
Now the question is whether omicron is a mere hiccup for Wells Fargo and other companies, or something deeper and more troubling.
For companies with staff back already, “they are not saying ‘Whoa, whoa, whoa, now go back home,’” said Elise Freedman, Korn Ferry’s workforce transformation practice leader, who works with companies on their return-to-office plans. First steps might include setting stricter on office rules like masks in public spaces or maintaining low numbers of people in conference rooms, Freedman said.
President Joe Biden said Monday he didn’t have his eye on “shutdowns or lockdowns,” giving a boost to U.S. stock benchmarks in Monday’s trading session.
Stéphane Bancel, the CEO of Moderna MRNA, -4.36% predicted the current array of vaccines would be less effective against the omicron variant.
At Tuesday’s close, the Dow Jones Industrial Average DJIA, -1.86% closed 650 points lower or 1.9%, and the Nasdaq Composite Index COMP, -1.55% was off 1.6% or 245.14 points. The S&P 500 SPX, -1.90% fell 88.27 points, or 1.9%.
For companies that are still working remotely, Freedman was already hearing increasing caution before the omicron strain emerged. COVID-19 cases have been increasing and flu season arrived, she noted. “A number of clients say we are just going to play it slow,” Freedman said.
If vaccines, medical treatments and social distancing measures can keep omicron in check, Mark Ein, chairman of Kastle Systems, said companies could delay their full returns the office, but he sees the omicron variant’s emergence “more as a hiccup or a road bump than it is any fundamental shift.” Ein views the return-to-office issue from the security software and services his company provides.
“I think people are just so eager to get back to the office that they are not going to let things that aren’t fundamentally different or fundamentally serious get in the way of getting their teams back together,” he said.
Last week, the company’s weekly office occupancy gauge showed buildings where Kastle provides access security were 32.5% occupied on average. That’s down from a 38.8% national average one week earlier, but Ein attributed that to the shortened Thanksgiving work week. He expects the occupancy numbers to rebound this week.
Ahead of omicron, other numbers indicated more people were physically back in the office and fewer were home.
Almost 12% of workers said they had teleworked or worked from home at least once in the past month due to the pandemic, according to a supplement in the Labor Department’s October jobs report. That was down from 23.2% in January, the Bureau of Labor Statistics numbers show.
The omicron variant comes as 2022 office return dates loom for several companies.
Meta FB, -4.01%, then Facebook, announced in August it was pushing its office return date to January. The same month, Google GOOG, -2.51% said its voluntary return-to-office policy would run through Jan. 10. From that point on, offices in varying locations would come up with their own office return dates. Capital One COF, -4.41% was aiming for a November return, but announced last month it was putting off the event until an unannounced point in 2022.
“We’re currently monitoring the situation closely and our return to office plans for January 2022 remain,” a Meta spokesman said. A Google spokeswoman declined to comment.
Corporate employees at DoorDash were slated to work from home through the end of 2021. Come January, the company said it would “reintroduce in-person work for these employees through a hybrid approach, encouraging live collaboration with a balance of remote flexibility.”
In light of omicron, the company was taking a wait-and-see approach, Chris Cherry, DoorDash’s director of global safety and security, said in a Monday statement.
“This is a dynamic situation that we’ll continue to evaluate, making educated decisions based on the most up to date guidance and information we receive,” Cherry said.
If the omicron variant is more contagious, more virulent or resistant to current vaccines, Bradford Bell, a Cornell University professor focused on strategic human resources, said he’d expect companies to push back their return to office timelines. He’d also expect them to tighten access and rules for the staff that is coming back already.
But the omicron variant is also coming amid a labor shortage when many companies are on the hunt to find and keep staff. So even if physical office returns get dialed down, Bell doesn’t think hiring plans will also.
If any disruptions from omicron are more long-term, Bell said it’s possible companies will reduce hiring to brace for smaller business. “But, given the challenges companies have been facing in their efforts to staff back up, I think most will be very hesitant to lose any momentum they have been able to start building back on the hiring front,” he said.