Economy Watch: Telecommuning Rising in Popularity, But Offices Still Need Ample Parking

As improved broadband adoption and flexible work schedules become the norm in many places, the share of people working from home is up.

By Dees Stribling, Contributing Editor

According to a new report by the Brookings Institute, which analyzed data from the Census Bureau’s 2014 American Community Survey, as improved broadband adoption and flexible work schedules become the norm in many places, the share of people working from home is up. As of 2014, it stood at 4.5 percent, up 314,000 workers over the previous year. This includes 15 metro areas that have seen a statistically significant increase in the number of people working from home, including tech centers like Raleigh, San Diego and San Jose. Moreover, these numbers probably undercount people who commute in more traditional ways on some days and telecommute on others.

That’s certainly something for office developers and owners to keep in mind. The demand for office space in the hottest markets (such as San Francisco or Seattle or Denver) is now being driven by tech users in large part, who have specific ideas about what that space should look like and what part it needs to play in their businesses—namely helping to recruit and keep employees. Will growth of telecommuting, which didn’t really take off like it was predicted to do in the 1990s or 2000s, actually going to do so in the coming years? After all, a flexible workplace, at least according to 2010s thinking, is paramount. Flexibility also presumably means working at home or the coffee shop down the block sometimes, so telecommuting might be a bigger thing in the 2020s than now or in previous decades.

Another thing for office space owners to think about: the Brookings report noted that the share of commuters driving to work (85.7 percent) didn’t change much between 2013 and ’14. While most of these workers continue to drive alone, those choosing to carpool are hitting new lows—down to 9.2 percent of all commuters and now at roughly half the levels seen three decades ago. At the local level, only 15 of the country’s 100 largest metros showed any statistically significant change in their driving rates in 2014 compared with the previous year. Most of the declined, oddly enough, were in traditional car-centric markets like Louisville, Charleston and Knoxville.

Also according to the report, the share of commuters taking public transportation has barely budged from 5.2 percent between 2013 and ’14. Although the United States is seeing a record number of passenger trips across a variety of transit systems, the share of workers commuting by public transportation has only inched up in most markets, if that. Since 2013, just eight of the 100 largest metro areas have seen a significant increase in workers taking public transit, led by 1.3 percentage point gains in Honolulu and Las Vegas due in large part to growing bus commuters. In short, while TOD can be an excellent kind of office development, the truth of the matter is that most workers still drive to work, and office properties are going to have to continue to accommodate that.

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