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US banks call for office return while European finance embraces hybrid model – What is behind the disparity?

Commutes, culture, and legal factors lead to divergent strategies.

Chris Biggs, Partner at accounting and consultancy disruptor Theta Global Advisors discusses the divergent approaches between US and European financial firms in their back to the office strategies.

This week, New Yorkers have started to see their return to the office, but with commute culture and population density more similar to that of European cities than the rest of the US, employees have raised concerns. Calls are being made for back to office strategies to follow the lead UK and European financial firms’ back to office strategies instead, highlighting the divergent approaches seen between US and UK financial firms and triggering debates as to why they differentiate to such a degree.

While those advocating for this more ‘US’ approach argue that being back in the office en masse will improve company culture and make training younger staff easier, those advocating for a more flexible approach highlight productivity surges and financial firms having had record revenues in 2020. 

This debate between which approach is better, that seen in the US, or the hybrid approach favoured in Europe leaves UK employers tallying scores of pros and cons for each approach. However, while many debates are centred around which approach is objectively better, flexibility and subjectivity have proven essential in a successful adaptation to the pandemic over the last year. 

Theta Global Advisors, an accounting and consultancy disruptor has conducted research on employee experiences and how flexible practices are not only wanted, but needed.

Key stats:

  • 57% of workers want to choose where to work to be the most productive
  • Over a third (34%) of UK workers have seen their workplace’s headcount decrease and their workload increase in the last 12 months

(nationally representative research carried out across a body of 2100 respondents, in full compliance with British Polling Council guidelines)

Chris Biggs, partner at consultancy and accounting disruptor, Theta Global Advisors comments on the divergent approaches between US and UK financial firms regarding back to office strategies and what employers should consider post-pandemic:

To ensure people are at their happiest and most productive, flexibility is needed in both where and when they work. Freedom from the office must also mean freedom to go to the office to account for different experiences, priorities, and conditions. 

For more than a year now, employers and employees have been navigating shifting relationships while working from home. Naturally, both employers and employees have experienced the pandemic differently dependant on where in the world they live, and as lockdowns begin to ease in many countries, we are seeing the full extent of the spectrum of back to the office strategies.

The differentiations we have seen between financial firms in the US compared to the UK and Europe has been stark and can be explained by a number of nuanced factors – Namely: Culture; commutes; and legal factors. 

Historically, European and UK financial firms have approached work/life balance with a greater emphasis on happiness in one’s personal life as evidenced by employees consistently getting more vacation time at European and UK firms compared to the US.

Indeed, this cultural phenomenon has been cemented in law with European working time Directives dictating a minimum of 4 weeks vacation for employees. With no national equivalent to such a strong directive in the US, the socio-legal implication on working culture and work/life balance is significant and may explain why US firms favour and may see greater success in approaches encouraging mass returns to the office for company culture. 

Commuting is another significant factor employers must consider in their return to the office strategies. Outside of NYC – with commuting difficulties similar to many UK and European cities – it is far more common for employees to drive to work. As such, with their commutes being far shorter and easier to that of employees at financial firms in European hubs such as London or Paris, US firms see far less of an impact on employee productivity when asked to commute to their offices. 

Further, given our experiences in the last year, large numbers of people being cramped into a small space has become more undesirable that we ever could have expected. Such commutes for employees in more densely populated cities will take a toll on mental health as employees worry for their health during their daily commute, naturally impacting their happiness and productivity greatly. This is a significant differentiation between US and UK/European experiences that decision makers must not fail to consider when developing their back to the office strategies.

We have shown that we can work remotely, but this has also highlighted the positives for many of going to the office and the vital function the office plays in our economy and society. Some people will require access to an office for personal space, effective equipment, or internet, but others may not have these issues, and might have familial commitments or simply enjoy working from home more.

As such, while financial firms in the US and Europe see many similarities, our experiences have been and will continue to be different and unique. What we need is for businesses, organisations, and companies to follow the examples we’re seeing of more and more employers shifting to flexible working in the long term and catering to everyone in their flexi-working policies – They must outline structured flexibility approaches to allow people to adapt as they need or want going forward”

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