Back to the Office for Tech Workers

User Forum Topic
Submitted by deadzone on February 23, 2022 - 2:35pm

Covid is over now for all intents and purposes. Amazon announced return to the office (3 days a week) and no longer requiring vaccine.

You knew this was coming, other large tech companies will follow suite. This change in addition to tech stocks getting absolutely hammered in the stock market this year will pretty much put an end to the "Bay area tech worker moving to ___ for remote work".

Just another ominous sign for the housing market along with rapidly rising interest rates. Anybody flipping houses now is going to get rammed hard. I think Zillow was wise to get out of that business when they did.

Submitted by sdrealtor on February 24, 2022 - 10:08am.

deadzone wrote:
That has been true since 2009. However, with 7% inflation they cannot get away with dropping anymore helicopter money. I HOPE we see the Fed is actually allowing a crash/recession this time. However, ultimately no doubt they will make sure the banks are bailed out as usual.

FIFY

Submitted by Coronita on February 24, 2022 - 10:28am.

deadzone wrote:
Problem is if there is layoffs at Shopify or whatever it will be due to after effects of market crash and recession from the bursting of the bubble. So in that scenario most of the industry will be laying off.

Back to the original comment, sure there will probably some companies offering fully remote for a while. However, the point is majority of folks are going to be heading back to the office, at least part time, very soon. And the total pool of fully remote workers will be going down from the peak of Covid. How much this affects RE in San Diego, is debatable, but it is not a positive.

Not every employee or engineer can act like an entitled baby and just quit and move to another company because they don't get their 100% remote gig anymore. That only works now, if at all, because the job market is so tight due to all of the Fed money printing. If/when the Fed turns off the spigot, there will be a recession and the job market will not be tight anymore.

For every company laying off there are a bunch of VC funded new companies. Nothing has changed really. Shopify even doesn't have a major footprint in CA. Also a bad example, Shopify has been routinely hiring and firing well before their latest wall street numbers. It's part of their "culture"...

Shopify actually IS one of the companies that count on remote workers to get around the high cost of employee Bay Area employees.Because they know they can't compete with the FANG companies for talent with deeper pockets.

https://www.glassdoor.com/Reviews/Employ...

Besides, given their large customer base, there's plenty of contracting and consulting work and offshoot products built on top of shopify . It's not just the company it's the entire ecosystem of developers and talent to support all the large customer install base. Similar to what Salesforce.com did.

Submitted by deadzone on February 24, 2022 - 10:55am.

sdrealtor wrote:
deadzone wrote:
That has been true since 2009. However, with 7% inflation they cannot get away with dropping anymore helicopter money. I HOPE we see the Fed is actually allowing a crash/recession this time. However, ultimately no doubt they will make sure the banks are bailed out as usual.

FIFY

My hope has nothing to do with it. Fed can't print money forever. Sooner or later there has to be a crash in order to have another rescue and re-inflate the next bubble. That's how bubble economies work. TPTB (i.e. WS bankers) control when the crash happens. Whether this is THE crash or not is yet to be determined, but there will be a crash.

Submitted by deadzone on February 24, 2022 - 10:59am.

Coronita wrote:
deadzone wrote:
Problem is if there is layoffs at Shopify or whatever it will be due to after effects of market crash and recession from the bursting of the bubble. So in that scenario most of the industry will be laying off.

Back to the original comment, sure there will probably some companies offering fully remote for a while. However, the point is majority of folks are going to be heading back to the office, at least part time, very soon. And the total pool of fully remote workers will be going down from the peak of Covid. How much this affects RE in San Diego, is debatable, but it is not a positive.

Not every employee or engineer can act like an entitled baby and just quit and move to another company because they don't get their 100% remote gig anymore. That only works now, if at all, because the job market is so tight due to all of the Fed money printing. If/when the Fed turns off the spigot, there will be a recession and the job market will not be tight anymore.

For every company laying off there are a bunch of VC funded new companies. Nothing has changed really. Shopify even doesn't have a major footprint in CA. Also a bad example, Shopify has been routinely hiring and firing well before their latest wall street numbers. It's part of their "culture"...

Shopify actually IS one of the companies that count on remote workers to get around the high cost of employee Bay Area employees.Because they know they can't compete with the FANG companies for talent with deeper pockets.

https://www.glassdoor.com/Reviews/Employ...

Besides, given their large customer base, there's plenty of contracting and consulting work and offshoot products built on top of shopify . It's not just the company it's the entire ecosystem of developers and talent to support all the large customer install base. Similar to what Salesforce.com did.

So when Fed turns off the spigot, there will be an overall recession and tech will be hit very hard. Less jobs industry wide. San Diego and everywhere. Remote and office. At this point, employees will have a lot less leverage to "Demand" that they be allowed to work at home.

Submitted by Coronita on February 24, 2022 - 11:48am.

deadzone wrote:
Coronita wrote:
deadzone wrote:
Problem is if there is layoffs at Shopify or whatever it will be due to after effects of market crash and recession from the bursting of the bubble. So in that scenario most of the industry will be laying off.

Back to the original comment, sure there will probably some companies offering fully remote for a while. However, the point is majority of folks are going to be heading back to the office, at least part time, very soon. And the total pool of fully remote workers will be going down from the peak of Covid. How much this affects RE in San Diego, is debatable, but it is not a positive.

Not every employee or engineer can act like an entitled baby and just quit and move to another company because they don't get their 100% remote gig anymore. That only works now, if at all, because the job market is so tight due to all of the Fed money printing. If/when the Fed turns off the spigot, there will be a recession and the job market will not be tight anymore.

For every company laying off there are a bunch of VC funded new companies. Nothing has changed really. Shopify even doesn't have a major footprint in CA. Also a bad example, Shopify has been routinely hiring and firing well before their latest wall street numbers. It's part of their "culture"...

Shopify actually IS one of the companies that count on remote workers to get around the high cost of employee Bay Area employees.Because they know they can't compete with the FANG companies for talent with deeper pockets.

https://www.glassdoor.com/Reviews/Employ...

Besides, given their large customer base, there's plenty of contracting and consulting work and offshoot products built on top of shopify . It's not just the company it's the entire ecosystem of developers and talent to support all the large customer install base. Similar to what Salesforce.com did.

So when Fed turns off the spigot, there will be an overall recession and tech will be hit very hard. Less jobs industry wide. San Diego and everywhere. Remote and office. At this point, employees will have a lot less leverage to "Demand" that they be allowed to work at home.

It really depends. So many retail and entertainment companies are scrambling to reinvent themselves. That won't slow down because for them it's sink or swim for them. I'm in this space and our business has been growing during the pandemic. Other companies larger players have taken out low interest loans and using it to invest in their business. My company did something like that. As far as our business is concerned, we have remote workers because we need personnel closer to where our customers are than a central office. It's easier for them to be onsite to do work that feeds into the product than having them travel back and forth between our Florida office. Hiring someone from Florida and having them spend 60% of their time as engineers on a plane is going to accelerate their resignation than hiring someone in LA next to our clients and allowing them to work remotely and be onsite...same could be said for our clients in the Midwest and Southern states. Also applies to our UK and Aussie customers...In fact now that work remote is more acceptable, there's no need to restrict remote workers just to field engineers and support engineers and sales... It's possible now to embed mobile engineers and platform engineers that work on the main product in these strategic locations more easily and as a result run a more integrated team from beginning to end...lots of benefits doing that too, because it reduces the traditional problem of product engineers being out of touch with real customer needs and issues...

Again, unless you are in management and have weighed some of these pros and cons, you won't know why some of these decisions are made and you're basing your opinions based on news articles you read that has very little to do with real business problems companies are solving.

Submitted by deadzone on February 24, 2022 - 12:50pm.

Your reasoning for why some remote workers makes sense, and it has nothing to do with Covid. My point is the great majority of things went to extreme levels due to covid. One is remote work, the other main change is the Fed printed over 4 trillion dollars and doubled their balance sheet in 2 years.

With Covid winding down, there will be less Fed support and less folks working 100% from home, overall. You just keep giving niche examples. I never claimed that work at home will completely go away after Covid. But it will go down significantly. It has been publicly announced by several of the major Tech companies. Are you claiming they are lying? What insider knowledge do you have at Amazon and Google that I don't have? Just because your company isn't requiring people to work at the office doesn't change that.

Submitted by sdrealtor on February 24, 2022 - 1:15pm.

deadzone wrote:
sdrealtor wrote:
deadzone wrote:
That has been true since 2009. However, with 7% inflation they cannot get away with dropping anymore helicopter money. I HOPE we see the Fed is actually allowing a crash/recession this time. However, ultimately no doubt they will make sure the banks are bailed out as usual.

FIFY

My hope has nothing to do with it. Fed can't print money forever. Sooner or later there has to be a crash in order to have another rescue and re-inflate the next bubble. That's how bubble economies work. TPTB (i.e. WS bankers) control when the crash happens. Whether this is THE crash or not is yet to be determined, but there will be a crash.

Bookmarked

Submitted by Coronita on February 24, 2022 - 1:37pm.

deadzone wrote:
Your reasoning for why some remote workers makes sense, and it has nothing to do with Covid. My point is the great majority of things went to extreme levels due to covid. One is remote work, the other main change is the Fed printed over 4 trillion dollars and doubled their balance sheet in 2 years.

With Covid winding down, there will be less Fed support and less folks working 100% from home, overall. You just keep giving niche examples. I never claimed that work at home will completely go away after Covid. But it will go down significantly. It has been publicly announced by several of the major Tech companies. Are you claiming they are lying? What insider knowledge do you have at Amazon and Google that I don't have? Just because your company isn't requiring people to work at the office doesn't change that.

I didn't say that covid was the cause of all remote workers to begin with. But now that covid has proven that remote workers are viable, businesses are seriously considering using remote workers because it's been proven by many companies that it can be implemented successfully.

That's the point. The cat is out of the bag. My company was already remote friendly before covid, and simply extended that as an option...But other companies that were hesitant before and saw the results, many are going to continue that.

Previously, most companies were hesitant even consider remote workers as an option because there was the concern about productivity, reliability, etc. Covid forced some of these companies to do this in order to keep running.

Many (not all companies) have figured out it works well for them and even when covid is no longer going to be an issue, they will continue with a remote friendly policy. Some companies will do old school and revert back in office only.. And some employees that are either scared or take offense to that will have the opportunity to switch employers, if their skills/abilities/etc are in demand.

Honestly, Google and Amazon prefer in office, but given how well they pay (better than MSFT), given their comp packages, I'd pour coffee for them if I could get in. Amazon is a little unique in that you don't really get much before 3 years. If you can survive for 3 years though, that's serious $$$$...In both cases though, they have enough satellite offices that an employee prospect just has to report to "a" field office. And I'm pretty sure for the right candidate best of the best, they will still make exceptions than the norm...In San Diego, that's totally possible because like I said Google, Amazon, Apple all have a sizeable presence here now...

The other thing you are discounting is the issues with the supply chain and the now uncertainty of war....Onshoring is now making a comeback where at least in the hardware sector, companies are now compelling to onshore Fab and moving away from China and even Taiwan (or at least second source stuff domestically)... I mean, Taiwan will still be a leader with TSM, but they too are setting up shop here in the US because given the political instability right now in China, there's a vested interest and a national security interest to bring some of this work back into the US. And given that we have inflation, perhaps that US wages now can justify having some of this manufacturing done in the US again. While companies like Intel never able to let US chip fab workers work remotely to begin with, they are expanding their footprint by now spinning up Fabs in the US for that reason. TSM and Samsung doing the same thing...

These manufacturing jobs won't be available in CA, but elsewhere in the US, it's good news.

Intel in Ohio:
https://www.jobsohio.com/intelinohio/?gc...

TSM in Arizona:
https://www.extremetech.com/electronics/...

Samsung in Texas:
https://news.samsung.com/global/samsung-...

America wins.

Long term.. Political instability is probably good for the US...US has the unique privilege of being worlds away from Europe and Asia, where the geo-political instability is happening. Just like in WW1 and WW2, continental US was shielded from main conflict...Seems to me, that US is a safe bet right now to expand to fix the supply chain issue, especially with inflation, that can justify higher wages to do it here.

The serious consideration is if a company spends a fortune to setup more FAB in Taiwan, what if China overruns it like Russia did with Ukraine? From a national security interest, it makes sense to invest in the US.

Work is coming home. And as long as there is hardware work, software work will follow and all the ancillary support technology that comes with it.

Submitted by sdrealtor on February 24, 2022 - 1:45pm.

Just some data to ponder over. I have been tracking 2 markets this year.

Mira Mesa has a population of about 85,000. There have been 33 houses placed on the market this year most of which are in same price range.

The NCC area I follow has about 125,000. THere have been 82 houses placed on the market of which about half are basically trophy properties above $2.5M so about 40 that would be purchased by typical working folks living in the area.

Long time owners are locked into mortgages with rates in the mid 2% range with a low prop 13 tax basis and many are sitting on gains above the capital gain exclusion level. THere is no major relief in supply coming anytime soon no matter what happens with the economy. My mortage plus taxes, insurance and hoa is less than the rent on a 1 BR Apartment around here now. I am not unique here.

It doesnt take everyone in a WFH job to buy the 5 to 10 regular homes that hit the market each week in either of these areas. Hope is a good thing, maybe the best of things but no good thing ever dies

Submitted by Coronita on February 24, 2022 - 1:59pm.

sdrealtor wrote:
Just some data to ponder over. I have been tracking 2 markets this year.

Mira Mesa has a population of about 85,000. There have been 33 houses placed on the market this year most of which are in same price range.

The NCC area I follow has about 125,000. THere have been 82 houses placed on the market of which about half are basically trophy properties above $2.5M so about 40 that would be purchased by typical working folks living in the area.

Long time owners are locked into mortgages with rates in the mid 2% range with a low prop 13 tax basis and many are sitting on gains above the capital gain exclusion level. THere is no major relief in supply coming anytime soon no matter what happens with the economy. My mortage plus taxes, insurance and hoa is less than the rent on a 1 BR Apartment around here now. I am not unique here.

It doesnt take everyone in a WFH job to buy the 5 to 10 regular homes that hit the market each week in either of these areas. Hope is a good thing, maybe the best of things but no good thing ever dies

Longer term owners are pretty close to debt free or at least have rental income that covers said low interest 30 year loans.

Submitted by sdrealtor on February 24, 2022 - 2:28pm.

Yes that too. If I rented my place out it would be cash flow positive by almost $4K even with a loan

Submitted by Coronita on February 24, 2022 - 2:32pm.

Hey deadzone... Can you keep talking about how bad tech will do and how bad the stock market will continue to crash. We need a few more days of this kind of talk from you....

Submitted by deadzone on February 24, 2022 - 2:51pm.

Coronita wrote:
Hey deadzone... Can you keep talking about how bad tech will do and how bad the stock market will continue to crash. We need a few more days of this kind of talk from you....

Yea really, but more likely today was a relief rally aka dead cat bounce. The downward trend in the market is pretty strong. The Nasdaq still has a long way to retrace just to get to pre-covid numbers. As long as inflation keeps running hot, there likely will be no save from the Fed this time.

Bookmark

Submitted by XBoxBoy on February 24, 2022 - 5:46pm.

deadzone wrote:

The Nasdaq still has a long way to retrace just to get to pre-covid numbers.

Yeah, that's true. QQQ's are probably about $100 above their pre-covid level, so another 30%. SPYs about the same, maybe only 20%. And north country real estate would need to drop more than 30% to get to pre-covid levels I suspect.

Which leads me to wonder, are you predicting that things have another 30% to drop from here, or are you just saying, "Things will go down from here, but anyone who bought stocks or real estate and has held if for over two years will still be ahead." Curious minds want to know.

Submitted by sdrealtor on February 24, 2022 - 8:00pm.

SFR's around me would have to drop at least 40%. During the bubble bust they went down less than 25%. Seems to be saying a singificantly bigger downturn then 2007 to 2011

Submitted by deadzone on February 24, 2022 - 10:35pm.

XBoxBoy wrote:
deadzone wrote:

The Nasdaq still has a long way to retrace just to get to pre-covid numbers.

Yeah, that's true. QQQ's are probably about $100 above their pre-covid level, so another 30%. SPYs about the same, maybe only 20%. And north country real estate would need to drop more than 30% to get to pre-covid levels I suspect.

Which leads me to wonder, are you predicting that things have another 30% to drop from here, or are you just saying, "Things will go down from here, but anyone who bought stocks or real estate and has held if for over two years will still be ahead." Curious minds want to know.

Well since all Covid related asset price gains, stocks, RE, etc. were completely artificial (Thanks to Fed printing 4 plus trillion dollars) it is a logical assumption they will be reversed at a minimum to pre-Covid levels given all of the Covid related programs will soon be over.

Submitted by Coronita on February 25, 2022 - 7:39am.

deadzone wrote:
XBoxBoy wrote:
deadzone wrote:

The Nasdaq still has a long way to retrace just to get to pre-covid numbers.

Yeah, that's true. QQQ's are probably about $100 above their pre-covid level, so another 30%. SPYs about the same, maybe only 20%. And north country real estate would need to drop more than 30% to get to pre-covid levels I suspect.

Which leads me to wonder, are you predicting that things have another 30% to drop from here, or are you just saying, "Things will go down from here, but anyone who bought stocks or real estate and has held if for over two years will still be ahead." Curious minds want to know.

Well since all Covid related asset price gains, stocks, RE, etc. were completely artificial (Thanks to Fed printing 4 plus trillion dollars) it is a logical assumption they will be reversed at a minimum to pre-Covid levels given all of the Covid related programs will soon be over.

So just to help people out here...You believe...err...expect with conviction that both stock market and San Diego real estate prices will correct back to pre-covid prices, right?

Can you repeat your conviction of this certainty today?

Submitted by deadzone on February 25, 2022 - 8:50am.

Yes I absolutely believe that, it is logical given the only reason those prices shot up the last two years were due to various Covid policies, most notably Fed money printing, PPP loans, Stimmies, Mortgage and rent moratoriums, historic low interest rates, work from home, etc.

Every one of the above influences has started to reverse and if you believe Covid is over, from a government policy perspective, will continue to reverse or expire.

By far the biggest contributor to this is Fed QE/money printing. So personally I'm not going to bet the farm on anything. They say they are going to raise interest rates starting in March, and also start winding down balance sheet, most notably MBS purchases starting in March. Market seems to believe it so far. But I won't believe it until it happens.

Fed has proven consistently that their #1 mandate is to inflate stock and RE prices above all else. They realize (correctly) that our economy is totally reliant on wealth effect. Without it, our economy will implode. That's why they kept up QE constantly since 2009, even though the recovery was complete by about 2013 or so.

Submitted by Coronita on February 25, 2022 - 10:09am.

deadzone wrote:
Yes I absolutely believe that, it is logical given the only reason those prices shot up the last two years were due to various Covid policies, most notably Fed money printing, PPP loans, Stimmies, Mortgage and rent moratoriums, historic low interest rates, work from home, etc.

Every one of the above influences has started to reverse and if you believe Covid is over, from a government policy perspective, will continue to reverse or expire.

By far the biggest contributor to this is Fed QE/money printing. So personally I'm not going to bet the farm on anything. They say they are going to raise interest rates starting in March, and also start winding down balance sheet, most notably MBS purchases starting in March. Market seems to believe it so far. But I won't believe it until it happens.

Fed has proven consistently that their #1 mandate is to inflate stock and RE prices above all else. They realize (correctly) that our economy is totally reliant on wealth effect. Without it, our economy will implode. That's why they kept up QE constantly since 2009, even though the recovery was complete by about 2013 or so.

Just wanted to double check again. Do you really think things will crash and burn? Like almost definite? Both the stock market and real estate market? Can we cant your confirmation for this afternoon too?

Submitted by deadzone on February 25, 2022 - 10:54am.

is reverting to pre-covid bubble highs really crashing and burning? Those are your words, not mine.

Nothing is certain in this world. All depends on what the Fed does. They control this 100%.

Submitted by Coronita on February 25, 2022 - 11:38am.

deadzone wrote:
is reverting to pre-covid bubble highs really crashing and burning? Those are your words, not mine.

Nothing is certain in this world. All depends on what the Fed does. They control this 100%.

But you do think we will see a correction to pre-covid stock market and real estate right?
Can you say this with conviction at exactly at 12:45PST right before closing bell today?

Come on deadzone... Go deadzone!!! Let's push for +1000 dow by closing bell today.

Please...Say we are definitely going to havea serious correction back to pre-covid letter at 12:45pm. Pretty please.

Submitted by sdrealtor on February 25, 2022 - 12:12pm.

You missed one major reason prices shot up also. After living through COVID a lot of people’s preferences have changed. People got used to spending more time at home and want nicer homes. That’s unlikely to revert

Submitted by an on February 25, 2022 - 12:41pm.

sdrealtor wrote:
You missed one major reason prices shot up also. After living through COVID a lot of people’s preferences have changed. People got used to spending more time at home and want nicer homes. That’s unlikely to revert

That's transitory too

Submitted by deadzone on February 25, 2022 - 1:23pm.

I'm not going to support your day trading habit FLU. Shouldn't you be at work right now, writing code or something?

Submitted by deadzone on February 25, 2022 - 1:24pm.

sdrealtor wrote:
You missed one major reason prices shot up also. After living through COVID a lot of people’s preferences have changed. People got used to spending more time at home and want nicer homes. That’s unlikely to revert

Is that really your best counter-argument for why home prices won't correct post-covid?

Submitted by Coronita on February 25, 2022 - 1:30pm.

deadzone wrote:
I'm not going to support your day trading habit FLU.

I don't day trade. But just to clarify, you think the stock market will go significant down, right? Can you say that one more time before closing bell?
We're pretty close to +1000 dow to day, and you can help push it over...

Quote:

Shouldn't you be at work right now, writing code or something?

I'm the department head. I don't need to write code. I have people that do that. I just need to send emails and direct and collect my bigger paycheck...

emailemail
....
...

Shouldn't you be back in the office, deadzone, working and not wasting time on the internet? I mean, people that work in the office are suppose to be more focused and efficient and not waste time using company resources checking out a finance blog, right?

Submitted by deadzone on February 25, 2022 - 1:32pm.

Yes, middle management!
Reminds me of one of my favorite Office Space scenes..

https://www.youtube.com/watch?v=m4OvQIGDg4I

Submitted by sdrealtor on February 25, 2022 - 1:35pm.

deadzone wrote:
sdrealtor wrote:
You missed one major reason prices shot up also. After living through COVID a lot of people’s preferences have changed. People got used to spending more time at home and want nicer homes. That’s unlikely to revert

Is that really your best counter-argument for why home prices won't correct post-covid?

Nice straw man. Never said anything about them not correcting. It’s one reason they won’t correct as much as you think. There are plenty of others

Submitted by Coronita on February 25, 2022 - 1:36pm.

deadzone wrote:
Yes, middle management!
Reminds me of one of my favorite Office Space scenes..

https://www.youtube.com/watch?v=m4OvQIGDg4I

Get back to work, worker bee. Chop chop. Remember, expect your butt to be in your office seat, because we can keep better tabs on you! Worker smarter more efficient!

Submitted by deadzone on February 25, 2022 - 1:37pm.

Coronita wrote:

Shouldn't you be back in the office, deadzone, working and not wasting time on the internet? I mean, people that work in the office are suppose to be more focused and efficient and not waste time using company resources checking out a finance blog, right?

I'm actually not working today so no guilt. That reminds me of another of my favorite Office Space scenes.

https://www.youtube.com/watch?v=zBfTrjPSShs

I think the remote work revolution, long term, is just going to expose the reality that Office Space pointed out more than 20 years ago. The end game to this is if/when the Fed easy money policy changes, there will be a lot of layoffs and more and more US remote workers replaced by Indians and others.

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