Amazon is shutting one of its last remaining doors on remote work with a new mandate calling employees across its Ring division back to the office.
The Seattle-based tech giant, which acquired the video doorbell company in 2018, is requiring hundreds of customer service workers to work from physical hubs in the United States and the United Kingdom. The mandate, detailed in a memo company officials sent out this month, means many previously remote employees will have to relocate to keep their jobs.
Ring is headquartered in Hawthorne, California, and operates other customer service hubs in Massachusetts, Arizona and London.
An Amazon spokesperson confirmed the relocation requirement to CoStar News but declined to provide additional details such as when the in-person mandate will take effect and how many employees will be affected.
The escalated requirement coincides with the Ring parent's push to streamline and automate operations aimed at transforming the customer service department into a “proactive, AI-powered support ecosystem.”
It lands a few weeks after Amazon released plans to eliminate about 14,000 corporate positions as the company looks to artificial intelligence as a way to replace some positions filled by humans.
Ring's relocation mandate is also the latest step Amazon has taken to reinforce the value it has placed on in-person culture. The company last year decided to call employees back for a full workweek, a move that has since set off a domino line of stricter attendance requirements that have helped bolster the national office market recovery.
Back to 'office-centric'
Across the United States, companies are demanding more in-person time from employees, by revoking remote work privileges, increasing the number of days they're required to be in an office or asking a portion of the workforce to relocate closer to a corporate hub. Those demands, a number of landlords say, are finally beginning to translate into a material boost in office leasing after Amazon kicked off the trend with the implementation of its mandate early this year.
The number of Fortune 100 companies that now require a five-day workweek in the office has soared to about 55% compared with the 5% reported two years ago, according to a JLL survey. Only 1% of companies continue to allow fully remote policies, the survey said.
About 35% of employees today work from home at least one day a week, according to research from the University of Pittsburgh School of Business. Yet with a slew of mandates scheduled to roll out at the beginning of next year, that figure is expected to drop even further from its pandemic-era peak.
The push to get employees back to an office is largely credited with helping to boost leasing back to or, for some U.S. markets, beyond pre-pandemic levels.
The national vacancy rate of about 14% has largely hit its peak, according to CoStar research. While U.S. office leasing has yet to fully recover to pre-2020 levels, the 12 million square feet of deals signed in the third quarter is the most since 2019.
West Coast office landlord Hudson Pacific Properties has reported its strongest leasing period in years, largely due to the return of tech companies and the widespread push for them to boost attendance mandates.
"What has weighed on the market for a while has been tenant uncertainty," Hudson Pacific President Mark Lammas told CoStar News. "It started with work-from-home but is now transitioning as more companies are moving back to an office-centric model. They uniformly agree that productivity suffered when people were working remotely, and more have now adopted clear policies that are more consistent about being in the office. It's been a critical shift for all office owners across every market."
Much of the growth in recent months has been fueled by tech companies, specifically ones competing for a foothold in the booming AI sector.
That increasingly fierce competition has meant that companies, both in and adjacent to AI development, are prioritizing in-person work with strict mandates that in some cases demand time beyond the typical five-day workweek.
"AI has been different from older-guard tech companies in that they came out with an office-first model," Lammas added. "They've never wavered from that, since they know the competition they're up against. They have to be the best they can be, which means moving quickly, being very productive and working face-to-face in an office."