What employees returning to the office means for Center City: Highlights from our Reddit AMA

The City of Philadelphia is the latest major employer to publicly discuss a return to more in-office time. As other employers ponder their best long-term plan, the implications for workers, for the city’s commercial real estate market, and for the future of work in general hang in the balance.

With this in mind, The Inquirer hosted an AMA (“Ask Me Anything”) in collaboration with the r/Philadelphia subreddit to answer readers’ questions.

Here are the highlights from business reporters Jake Blumgart and Lizzy McLellan Ravitch. Some questions and answers have been edited for length, clarity, and tone.

Jake Blumgart: If we’ve learned one thing about the Parker administration, it’s that they want to be deliberative about decision-making and are not going to be rushed.

The mayor has made no secret of her desire to bring hybrid-capable workers back five days a week, and many of the AFSCME DC 47 members I talked to said they were aware of her rhetoric about this on the campaign trail last year. But I’m not sure if she sees the five-day-a-week return as her opening gambit and something that can be negotiated, or a hard line. I will note that the administration did not answer my question about whether they see this policy decision as a purely executive decision or something they need to bargain with the unions over. The answer would have told us a lot about what’s to come.

I don’t know how much of this is based on the decisions of other cities. The results in places like New York have been mixed.

At its core, though, I think this is something that Mayor Parker sees as the right decision. And many elites in the city agree with her, especially real estate honchos and labor leaders who have not been doing much remote work these past few years (and whose members and employees haven’t been either).

Lizzy McLellan Ravitch: That’s a great question, and it’s something we’ve heard from other city employees as well. They’ve noted that private-sector employers offer more money, and most offer some kind of hybrid-work arrangement as well. The mayor hasn’t shared any hints of a pay raise or other benefits to compensate for the loss of a hybrid schedule that we know of. We’ll keep asking about it as we cover the issue.

Lizzy McLellan Ravitch: Soon after her inauguration, Parker announced two big initiatives meant to reduce barriers to city employment. She removed the college-degree requirement for some city jobs, and she set a goal of eliminating written exams from the civil service system.

It’s also worth noting that City Council’s 2024 budget, passed last summer, allocated $20 million focused on recruiting and retaining workers across departments. Those investments included signing bonuses for public safety jobs, a workforce development program for the Streets Department, and expansion of the city’s parental leave offering.

Jake Blumgart: I covered a lot of Parker’s time in Council at a previous job with WHYY, and I can confidently say that if she wasn’t in her City Hall office 40 hours a week, she was still working in the field or in one of the satellite offices. Council members are often out in their districts, attending community events, meeting with constituents and stakeholders.

Of course Council doesn’t meet in the summer, but members say they are still working during those months doing constituent services, attending meetings, and so forth.

Jake Blumgart: The question of public safety on SEPTA came up a lot in my interviews with city workers, but only from those who ride the Market-Frankford Line or the Broad Street Line. Regional Rail riders only complained about the aggressively infrequent service, which leaves riders stranded for an hour or sometimes more if they miss a train. (This is something SEPTA said they were going to address earlier in the pandemic.)

The public order questions on SEPTA cannot be disentangled from the opioid and homelessness crisis. Law enforcement data show that actual crime on SEPTA is not up, but antisocial behavior — smoking, drug use, littering — most definitely is (and it’s worth noting this is not just a Philadelphia problem).

I ride the El every week, and the rider experience has deteriorated dramatically since before the pandemic. Notably, that line goes through Kensington, which is the heart of the region’s opioid crisis which has clearly spilled over onto mass transit.

But there’s not a quick solution to this. Antisocial behavior surged across the country during the pandemic. Having more riders would probably help, as people are less likely to light up a cig on a crowded train car, but it’s not a silver bullet. (I’ve been in packed NYC subways where a guy still smoked a joint despite the anger and disgust of everyone around him.) The fact that guns have proliferated so wildly since the pandemic adds to the problem. The fear of confronting someone who is armed is also a real concern.

Lastly, I would also note that it’s not like SEPTA is slacking on this question. They are asked to do a lot more than just shuttle people from place to place, including providing public safety and care for people in crisis or without homes. They clean their facilities and vehicles regularly, and the small police force does patrol. But there is only so much they can do: SEPTA executives are currently lobbying Harrisburg for more money, which even Gov. Josh Shapiro says is necessary for them to continue to operate, let alone improve services.

Lizzy McLellan Ravitch: As to the first question here, yes, loss of talent is measurable. While the impact can vary, depending on many factors, workplace experts tend to agree that turnover is expensive. For instance, one estimate cited by Gallup said the cost of replacing an employee could be anywhere from 50% to two-times that worker’s salary. So, for example, when an employee who makes $50,000 per year leaves their job, it could cost anywhere from $25,000 to $100,000.

Lizzy McLellan Ravitch: The definition of hybrid seems to vary greatly across companies. That’s been a big challenge in the past four years. In my reporting, I’ve heard of companies that ask people to come in once a week, up to four days a week, all calling their arrangements “hybrid.”

Some seem to be flexible about the number of days and hours, sending a message that individuals’ family circumstances and work duties may alter any given week. But some other employers have strict requirements, telling workers that they will be tracking how often their office-access badges are scanned. I’ve heard of some tying in-office attendance to promotion opportunities as well.

Jake Blumgart: Converting office buildings to residential is easier said than done in Philadelphia. That’s because our office market has been so weak for so long, and Center City’s residential market has been remarkably strong for so long. Most of the older buildings that are easiest to convert were already made over into apartments before the pandemic.

That said, there are a couple examples where permits were pulled last year to convert older buildings to apartments, including in the Public Ledger building (which is divided in two; one half is already residential). The biggest example is the former Morgan Lewis HQ at 1701 Market St., which Alterra is converting into apartments.

That building is actually a perfect example of why more conversions aren’t likely in the immediate future. 1701 had one tenant, and when they left, Alterra could take over and quickly begin the conversion process. Most office buildings have a lot of tenants, with leases that end on a variety of different dates. Even if a majority of tenants leave, they will still have a lot of leases with a lot of years left on them. A half-empty office building is still half-full.

Currently, the interest-rate environment has brought most development to a standstill, so that’s another hurdle to these often expensive conversion projects.

In a few years, many of the pre-COVID leases will have expired and some of the worst positioned buildings could be ready for conversion. But then there’s the problem with structures like the Wanamaker building, and most of the more modern buildings, which are simply not set up for easy conversion. A lot of expensive demolition and retrofitting work would be needed, and the buildings would essentially have to be sold for next to nothing to make it work.

Lizzy McLellan Ravitch: There are some employers who offer a pretax deduction from employees’ paychecks that can go toward paying for transit or parking. This doesn’t eliminate the cost entirely, however. The City of Philadelphia, and a few other local employers, have begun offering SEPTA passes to their workers for no cost through SEPTA Key Advantage. And a city law passed in late 2022 requires that businesses with at least 50 employees offer a commuter benefit program.

Lizzy McLellan Ravitch: I haven’t heard of any employers financially offsetting the environmental cost of their return-to-office policy.