User avatar
By Boiler
Have seen a lot of this individual on SYB.

Screenshot 2021-06-08 at 14-02-00 'Five-day office week will become the norm again'.png
Screenshot 2021-06-08 at 14-02-00 'Five-day office week will become the norm again'.png (14.95 KiB) Viewed 1399 times
The reply immediately below raises a valid point: why pay a British worker £15/hr to work from home if that same job can be done by someone from Turkey for £5/hr from their home...
User avatar
By kreuzberger
Killer Whale wrote: Tue Jun 08, 2021 2:25 pm What does it matter?
It actually matters a lot. I wrote about this on the old MW but the hollowing out of Central Business Districts matters a great deal.

There can be no serious doubt that cities will become more liveable if these largely daytime, weekday areas become repurposed for those who prefer denser living spaces with on-tap retail and entertainment. However, that is just the ground floor. The upper floors are destined to rot for decades unless they too can be repurposed for living rather than simply shuffling papers. It's difficult but not impossible. Whether it is financially viable is another question.

The problem sets in when we note that pension funds are massively weighted to commercial property and that that weighting was always a hedge to mitigate the liabilities which are looming due to longevity and falling birth-rates.

Withdraw that safety net of rising rents underpinned by long-term migration towards city centres and a knowledge (but geographically fixed) economy and everything starts to unravel as an alarming rate.

It is overly simplistic to suggest that Tamara in Turkey will be able to step in to the breach. Just as Derek in Delhi is only able to provide a basic first-line response to customers' needs. But, AI will increasingly fill in the gaps, as it was always going to do anyway, regardless of the availability of low wage workers' availability and enthusiasm.

I don't have a hotline to the future but my guess is that localised work-pods have a future in the mid-term, providing customer service in all its guises, albeit from decentralised workspaces that are clustered around commercial centres but not dependent upon them. There are perhaps ten years in that hypothesis.

But, the pension fund owned tower blocks have run out of road in the most spectacularly abrupt of fashions. It is a fact which will take a year or two to dawn on the markets. Sure, they will try to innovate their way out of the impending doom but there simply isn't the demand (and by definition, the profit motive) to soak up that vast amount of available repurposed office space.

Moreover, who the hell is going to meet the pension payments for all the boomers who thought that they had it made?

A safe-as-houses future predicated upon real estate is suddenly looking horrible, isn't it?
User avatar
By Killer Whale
Not really responding to the point I was making, though, which was that wage deflation may happen, but this will be because wage demands may lessen due to reductions in household expenses - basically, workers accepting lower pay in exchange for 'lifestyle' enhancements. This assumes all other things being equal, of course: Skills shortages may push wages in the other direction.
Cardiff, by the way, is already seeing office blocks being converted into student accommodation. In fact, the city council is under fire for allowing development of more student flats than the city needs. There is a worry that there will soon be pressure to allow these very small flats, too small normally to get planning permission, onto the general market. The inner workings of the planning department in Cardiff is a scandal waiting to emerge, I think.
User avatar
By Malcolm Armsteen
Here we have had office blocks, shops and now a nasty row of workshops next to a very main road converted into accomodation for the constantly increasing population here in the 'utter shithole' as I believe it is known.
User avatar
By Boiler
Malcolm Armsteen wrote: Wed Jun 09, 2021 9:17 am Here we have had office blocks, shops and now a nasty row of workshops next to a very main road converted into accomodation for the constantly increasing population here in the 'utter shithole' as I believe it is known.
Foetid shithole, Malc ;)

I believe something similar is happening round here in an attempt to make Peterborough less of a dump than it is (GLWT); a building that in its last incarnation was a branch of Poundland (my first memory of it was as a shoe shop in the early 70s) is being made residential. Also on the main road through the city. The buildings opposite it are destined to become a new library - ... te-2946611

Turning to points made by both KW and Kreuzy - oddly enough, exactly the same points were being made by a mate of mine in his last e-mail. As the last of the "boomers" hit pension age (let's say, those born in 1965) and withdraw from the work force in 2033 (assuming no further increase in state pension age), couple that with falling birth rates in the UK (as is happening now) and you're left with "where's the NI coming from to pay for state pensions and health care?"

Sooner or later, *someone* is going to have to make a very difficult decision about abandoning the "triple lock" on the State pension - and I pity those who are on modern "money purchase" schemes in their workplace, assuming they can retain a job long enough to qualify for one. Those who were/are lucky enough to have been in receipt of final salary schemes will very likely get hit by the reduction in values of property portfolios.

Good times are *not* ahead.
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