The Property Council of Australia (PCA) has demanded national cabinet to restore migration flows and return workers to offices in order to support the CBD property market:
Property Council of Australia CEO Ken Morrison says office occupancy in major CBDs is still well below pre-COVID levels, and most building owners or managers don’t expect that to change for at least three months.
“We are now at a critical juncture for our CBD economies, which are big drivers of economic activity and support hundreds of thousands of jobs,” he said in a statement on Thursday…
“For every worker who returns to their office, that is more business for CBD cafes, restaurants, retail outlets and other service providers.”
The Property Council wants National Cabinet to implement a roadmap to revitalise CBD economies, including:
* a direction to return to workplaces with the public service leading a return to normal workplaces.
* measures to boost confidence in public transport through increased capacity and hygiene measures as well as mandatory masks for commuters and incentives to encourage patronage.
* a review of physical distancing requirements on public transport and workplaces so that businesses can plan return to the office with confidence.
* a plan to restart migration next year, first with international students through an expanded quarantine program which could be expanded to include business migration and leisure travel.
The PCA is engaging in classic moral hazard behaviour here. It stands to gain significantly from immigration due to the increased demand that it places on both residential and commercial property.
However, the costs are borne by taxpayers via footing the bill for boosting quarantining capacity, increased competition in the labour market from migrants (in turn placing downward pressure on wages), and the potential spread of the virus into the community in the event of quarantine breaches.
In short, the PCA is talking its own book and should be ignored on immigration.
Allowing workers to return to offices in a limited capacity is sensible. Australia has virtually eliminated the virus, so the risk to the community is minimal provided there are no further hotel quarantine breaches.
However, returning to the office should be optional for workers if they can perform their role adequately from home. It should not be mandatory.
Survey after survey after survey has shown that Australian employees want to keep working from home (WFH) in some capacity. This relates to the time and cost savings from not having to commute into work, as well as the flexibility WFH provides.
The PCA’s argument that workers need to return to offices in order to support CBD businesses is also myopic.
While these CBD businesses are undoubtedly suffering from WFH protocols, suburban businesses nearby people’s homes are benefiting as economic activity is redirected there.
Thus, WFH presents a transfer of economic activity, not lost activity.
The welfare of both workers and suburban businesses must also be taken into account by national cabinet.
