Wall Street learns to relax about returning to the office

Wall Street bankers have been heading back to the office in recent days as Omicron variant infections decrease in New York, but this time the return to work is happening with a whimper rather than the bang that accompanied the reopening in the summer.

At Goldman Sachs, one of the industry’s biggest proponents of getting its bankers into the office, the mood was noticeably more muted than it was last summer when the bank welcomed staff back with food trucks and afternoon concerts.

Goldman provided staff with general guidance that they should expect to come back to the office on February 1st. Individual teams have been given the autonomy to decide how many days of the week bankers must come in, creating a greater sense of flexibility for now.

Optional

“It was sensory overload on the first day back in summer. It was nothing like that [this week],” said one Goldman banker. “It feels very different this time. It feels very optional.”

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Goldman has about 44,000 employees worldwide. A spokeswoman for the bank declined to comment.

The question facing bankers is whether the relaxed approach will continue as the spread of Omicron continues to fade and New York warms up.

Banks have been at the forefront of employer efforts to get staff back into the office following the pandemic, arguing that the apprenticeship culture and learn-by-doing nature of the roles make in-person work preferable to doing the job remotely.

The industry’s heavy regulatory and compliance burdens also make having employees on site more desirable.

The more relaxed stance reflects the growing tolerance in banking of a hybrid approach where staff are given greater flexibility to work at least a few days of the week from home, amid a competitive war for talent on Wall Street.

“We began to establish the future of hybrid work in October so people know what to expect this time around,” said Brian Friedman, president of Jefferies, an investment bank.

The Partnership for New York City, a local business lobby group, said only 16 per cent of employers in January reported that daily attendance at Manhattan offices exceeded 50 per cent. However, that number is expected to more than double to 38 per cent over the course of the first three months of 2022.

Mr Friedman said Jefferies already had more than 50 per cent of its bankers back in the office by Tuesday, a milestone that took “weeks” to hit when the bank brought staff back to its offices in October following 18 months of remote working during the pandemic.

However, some large banks, including Citigroup and Bank of New York Mellon, have publicly embraced hybrid work, in part based on the belief that flexible policies will provide a competitive advantage in the war for talent driving up remuneration costs across the industry.

Memo

BNY Mellon is working on a programme that would allow staff to work from anywhere in the world for two weeks in a year, according to an internal memo.

Citi only requires most staff to work from the office for two days a week.

Morgan Stanley has told bankers to prepare to return in February but has not given a specific date and policies will vary by team. One banker at the company said the residual threat of Omicron means it is still a reason some people are reluctant to come into the office.

“Given the environment, no one can make you come in,” he said. “People have earned the right to work from home if they want to.” – Copyright The Financial Times Limited 2022