By Bjorn Biel M. Beltran, Special Features Writer

Nearly two years into the pandemic has left many businesses in the world unsure of their prospects. Uncertainty reigns in an environment where most major economies are expected to lose anywhere between 2.9% to 4.5% of their gross domestic product — or up to almost 3.94 trillion US dollars of lost economic output, according to Statista.

Yet things are looking up. The World Bank projects the global economy to stage a robust 5.6% recovery this year, even if the rebound is expected to be uneven across countries. This recovery is mostly reliant on the strength of major economies such as the United States and China.

Coronavirus disease 2019 (COVID-19) will cast a very long shadow. While growth for almost every region of the world has been revised upward for 2021, the World Bank expects many continue to grapple with COVID-19 and its ramifications. Many countries will be unable to regain their lost momentum for an extended period, and this will largely shape the path of global economic activity.

“A lot of companies are waiting to see how much longer this pandemic will last. Some of them have made early decisions, downsizing, rightsizing, but many are on a wait-and-mode before committing to business decisions related to their real estate,” Christophe Vicic, country head of JLL Philippines Inc., told BusinessWorld in an interview. JLL is a global real estate services firm specializing in commercial property and investment management.

“But overall, the challenges remain. I think we need to understand that the real estate landscape will not go back to normal any time soon,” he added.

Mr. Vicic noted that all businesses across industries have had to adapt to the pandemic’s challenges. Indeed, many of these changes are visibly apparent, from the adoption of work-from-home business models to accelerated digitalization. In the Philippine real estate industry where JLL Philippines operates, many developers are readjusting their strategies to take advantage of BPO firms looking to create more smaller offices in the provinces to reduce business risks.

“One of the challenges that many Metro Manila-based companies had when the region was in lockdown was that all their operations were centralized in Metro Manila. You can’t operate as easily as those companies that have three or four smaller offices spread in other regions,” he said.

Furthermore, sustainability, which was once considered a “nice to have” bonus, is now viewed as the only way forward by many consumers and organizations across the globe. With the built real estate environment contributing to around 40% of total carbon emissions, many real estate companies are making sustainability pledges, shifting their priorities towards green buildings.

This further feeds into the growing trend revolving around employee wellness, safety, and security.

“As an employee, when you go out to work, eat at a restaurant, shop, or whatever activity you go outside your home for, you want to have a sense of safety and security. And I think this will influence the real estate of the future. To reinforce safety and security, there will be bigger offices with less people to allow physical distancing, which might mean organizations spreading their offices into more diverse locations closer to the homes of the employees,” Mr. Vicic said.

“In terms of workplaces, the new purpose of the office has transformed to support the working life of employees: to preserve their engagement, emotional well-being, and mental health. Historically, the workplace allocates majority of its area to individual spaces, but JLL believes that the future of office will be about collaboration and socialization. New workplace investments will be required to enhance human experience to support the working life of employees, and in turn, drive their performance. The wellbeing of the individual will remain one of the major trends that have emerged from the COVID pandemic,” he added.

When more than 19 million workers in the United States have quit their jobs since April, a phenomenon exacerbating industry-wide disruptions due to COVID-19, the value of employees in business has never been more relevant. Global management consulting firm McKinsey and Company highlighted the importance of understanding and creating a meaningful employer-employee relationship in the new normal.

“If the past 18 months have taught us anything, it’s that employees crave investment in the human aspects of work. Employees are tired, and many are grieving. They want a renewed and revised sense of purpose in their work. They want social and interpersonal connections with their colleagues and managers. They want to feel a sense of shared identity. Yes, they want pay, benefits, and perks, but more than that they want to feel valued by their organizations and managers. They want meaningful — though not necessarily in-person — interactions, not just transactions,” McKinsey wrote.

“By not understanding what their employees are running from, and what they might gravitate to, company leaders are putting their very businesses at risk. Moreover, because many employers are handling the situation similarly — failing to invest in a more fulfilling employee experience and failing to meet new demands for autonomy and flexibility at work — some employees are deliberately choosing to withdraw entirely from traditional forms of full-time employment.”

If left unaddressed, issues in employee experience will further contribute to what the company dubs as “The Great Attrition.” According to McKinsey’s research, 40% of surveyed employees said they are at least somewhat likely to quit in the next three to six months, while 18% of the respondents said their intentions range from likely to almost certain. These findings were found to be consistent across all five of the countries surveyed (Australia, Canada, Singapore, the United Kingdom, and the United States) and were broadly consistent across industries.

Businesses in the leisure and hospitality industry — which have already suffered the brunt of the pandemic’s impacts — are the most at risk for losing employees, but many healthcare and white-collar workers say they also plan to quit. Even among educators — the employees least likely to say they may quit — the study found that almost one-third reported that they are at least somewhat likely to do so.

Good leadership is essential in this crucial period of transition. And for Mr. Vicic of JLL Philippines, good leaders today need to do more than keep business performance and profits in mind.

“The need for compassion and understanding of the individual has redefined what I would call a good leader. Yes, we still have performance, targets to achieve, bottom line revenues to generate, but it has to be linked to well-being,” the country head said.

“The old days of performance at any price and any cost have gone. And if we want to ensure that we can continue to do business, I think the individual employee voice will have to be heard much more than it was pre-pandemic.”