As we emerge from the pandemic a big challenge for investors is working out which Covid-inspired trends will be sustained, and which will fade away as we return to some form of normality. As this more normal existence draws closer (we hope) the issue is becoming more pressing.

Among the big debates is the trend towards working from home. There is no question that office workers have got used to remote working in lockdown.

And as well as limiting risks associated with getting Covid there have been other benefits as people have saved on commuting costs and, in some cases, enjoyed a better work/life balance. A recent survey by Boston Consulting Group found 70% of employees felt they were able to be as productive at home as they were in the office.

Yet some people think working from home is just a short-term blip. In the past week or so prime minister Boris Johnson, probably mindful of his audience, told a Network Rail conference that workers would return to offices in a ‘few short months’ and Goldman Sachs CEO David Solomon said remote working was an ‘aberration’.

If they are right, then the bumper earnings announced by video conferencing firm Zoom on 2 March may soon be a thing of the past.

However, more quietly several firms have announced plans to scale back their office space – Lloyds (LLOY) and Barclays (BARC) among them.

A HYBRID APPROACH

The most likely outcome is a hybrid approach with workers spending some days in the office but more time at home too.

This would be short of the apocalyptic predictions made for the owners of office buildings and the transport companies which ferry people to their place of work but would also mean a role for Zoom, Microsoft Teams and other existing and emerging online tools which enable remote working. Though it seems almost impossible Zoom could ever replicate the 326% year-on-year increase in revenue posted in 2020.

In this author’s view the biggest risk is faced by business travel and it is therefore the hotels and airlines which lean heavily on this type of customer which face the most uncertain future.

While essential trips, perhaps to get that big transaction over the line or to expand into a new market will doubtless continue, it is hard to see the argument for a wholesale return to travelling all over the world for every pitch and powwow when video conferencing has proved a perfectly adequate replacement. The savings for companies of scaling back these activities could be significant.

As businesses are forced to consider their carbon footprint more closely the case for jetting staff all over the world looks increasingly shaky.

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