The Front Line Of The Hybrid Work Tug Of War In 2023 Is In The Middle

Decisions about a company's remote or hybrid work policies are often handed down from on high by the CEO. But the implementation, practicalities and, ultimately, the enforcement of hybrid arrangements are falling to managers who operate in the middle of the organization — and they are feeling the strain of the new work orders more than anyone.

For these hybrid arrangements, and the companies that implement them, to flourish, workplace experts told Bisnow that focused training and support for middle managers — something that may have slipped down the list of priorities for firms — is now critical.

“That management layer is so important in creating a return to office that is sustainable,” said Julie Whelan, the global head of occupier research at CBRE. “Many organizations are not arming that level with the training and the support they need to actually be able to do that with their team, because that's not been something that has traditionally been a competency that they needed to have.”

That competency is crucial, particularly as workplaces move toward finally formalizing their post-pandemic arrangements in 2023. While totally remote positions are decreasing, from 20% of all job listings in February to 14% in September, according to LinkedIn, workers are still demanding flexibility. Hybrid work is becoming something of a compromise, as companies seek to claw back more power after nearly two years of a labor crisis.

Middle managers typically know the demands, workloads, personalities and circumstances of workers, so they are largely going to be tasked with shepherding companies through this new phase of the workplace in 2023, a year likely to be dominated by the economic uncertainty that had set in through the second half of 2022.

“The mood in the middle is a big influence … [on] anything from return to office to DEI to you name it,” CBRE Executive Vice President Lauren Crowley Corrinet said. “That really powerful group that is driving the policy … If those managers aren't showing up themselves or asking employees to be accountable, then the policy doesn’t mean anything.”

Middle managers benefit the most from in-person work, according to Cushman & Wakefield’s most recent study of those kinds of roles. More than 40% of managers wanted to work in offices three days a week or more. And while employees do show an experience and engagement boost by being in the office at least three days a week, middle managers reported a higher engagement and experience boost than anyone else.

“Middle managers face the pressure of being the ambassadors and change agents to help deliver these visions by engaging with their teams,” Steven Zatta, who heads Cushman & Wakefield's Total Workplace Research and Innovation team, wrote in an email. "In many ways they are the key communication conduit between employees and leaders, they serve as change advocates, and they have a degree of accountability to support their employees in navigation of company RTO and hybrid work programs.”

Policies on the return to office remain a touchy subject between employers and their staff: More than a quarter of people who left jobs in the last year did so because their company did not offer flexibility around hybrid work arrangement or working hours, according to tenant platform Equiem's annual report released last month, which surveyed 3,000 office workers from the U.S., Canada, UK, Australia and Ireland. Meanwhile, 40% of the participants said they wouldn’t return to the office full time even if it were the “best-rated office” in the world.

Some are predicting more employees will adhere to managers' workplace preferences on office time as angst about layoffs set in.

"Remote work has been hardest on managers, and many companies’ managers of the departments have had the ability to determine the work schedule," said Kathryn Wylde, the president and CEO of the Partnership for New York City, a not-for-profit that pushes for pro-business policies. "So middle managers will continue to have a lot of discretion in bringing people back."

Just 9% of Manhattan employees are in the office five days a week, according to the partnership’s most recent return-to-office survey, released in September. Wylde said most companies are expecting to be back at work this year in a robust hybrid arrangement — with many people eager to appease managers’ demands amid a less worker-favorable employment environment.

“Most find that trying to manage by Zoom or phone is much harder," she said. "As people feel less secure about their jobs, it will drive a greater return to work. [Managers] are making the hiring and firing decisions.”

However, some experts have been skeptical about whether a recession alone will drive people back to their desks.

“Would you really feel good about working for an employer that uses the potential threat of layoffs to get you to go back?” Moody’s Analytics Head of Commercial Real Estate Economics Victor Calanog said in an interview with Bisnow last month. “Yeah, you might comply in the short run, and then guess who's gonna be stepping up their résumé?”

While middle managers are tasked with shepherding companies' hybrid arrangements into fruition, many are also struggling to make it work.

Middle managers are having the hardest time adjusting to hybrid workplace arrangements, according to a September Gallup study, largely because they are the link between the upper and lower parts of organizations, and motivation of workers largely falls to them. They are in more meetings than any other part of the business — often a challenging part of working hybrid, per the study. These managers, the Gallup survey noted, need an extra injection of support in the hybrid environment.

The key area of support, Whelan said, comes down to helping managers analyze and drive productivity of their teams. Few firms have data on productivity, but just how productive workers are within their individual working arrangements is what makes a hybrid successful — or not.

“Historically, goal-setting has been, you do it once a year, then you revisit midyear, and then you do year-end, and then the whole cycle happens again,” she said.

“And what we're finding now is that this need for continuous feedback is even more important in this hybrid work environment, so that you can really have clear goals between managers and employees. Then you have managers that understand how to follow up on those goals, which then ultimately proves that productivity is still good — because that is an argument that everybody is having right now. It’s around productivity.”

Monique Jefferson, the chief people officer at Community Preservation Corp., said empowering department heads is a key part of her company’s hybrid arrangement — and training has become a key part of the rollout. Overall, the firm set a framework of hybrid work for the company, but provided flexibility for the managers to set how it looks in practice.

A major part has been making sure the policies are fair, she said, and that managers set the rules with clear intentions with what they want to achieve.

“I would say one of those challenges is trying to come up with a hybrid way of working that works best for everyone on your team and making decisions and doing that in a fair and equitable way,” she said. “Because they are the front line, the middle managers, in that they're the closest to the employees."

Her company brought in a consultant to run a training program on leading hybrid teams inclusively, Jefferson said, in order to best equip the managers to succeed. 

"It was really to support and help them around how they're doing and what's changing," she said. "[Showing them] this is how you lead differently in this new environment and this new way of working.”

A key part was adapting the communication styles and strategies and being acutely aware of a growing issue of proximity bias, where those whose circumstances allow them to be in the office more regularly give them a leg up with their direct superiors.

“It's about being mindful and sensitive to this notion of proximity bias and making sure that when managers are making decisions with respect to their talent, that it's being done in a fair and equitable way — regardless of the type of employee they are or where they work," Jefferson said.

While the pressure is mounting on these managers to successfully roll out hybrid policies while navigating a myriad of complexities and their own workload and stress levels, it is likely more of an opportunity than anything else, said Jamie Hodari, the CEO of coworking company Industrious Office.

“I don't have a lot of sympathy for managers who complain that it's just another thing they have to deal with,” he said. “I think the right managerial mindset for this would be, ‘This is great, I have more openness and more ability to craft a plan for our team that works well for them.’”

He said decisions about when and where employees should work have better outcomes when made by team leaders and middle managers, even if it requires more managerial dexterity.

“It puts more pressure on holding managers accountable for the performance of their team versus optics,” he said. “But, I obviously think that's a good thing.”

Office owners, naturally, are watching closely to see how this shift in workplace office arrangements and power dynamics affects the leasing market. Rob Kluge, the senior managing director at Current Real Estate, said that even as hybrid work policies have seemed to get more cemented, some companies are still uncertain about their future space usage.

“We had several tenants that kind of got cold feet towards the end of the year. Typically, it's a time where tenants are rushing to finalize deals, and I think this year was a bit the opposite, where tenants were like, ‘You know what, let's take a step back. Let's see what happens in the first quarter. Let's come back to this in the second quarter,’” he said. “I expect that the beginning part of the year will be slow.”

In December, Manhattan office leasing was down 50% from the year before, per Colliers data. Demand was not in step with supply, and there has been growing belief that if companies settle on hybrid setups, they will take less office space as a result.

But, Whelan said, the current state of affairs doesn't foretell a broad abandoning of the office, even as workplaces change their arrangements.

“Sometimes change is hard, people don't like change. And so they're seeing it as negative, when really, I think that the office is going to come out the other end of this stronger than it was going into it,” she said, referring to going to the office as a muscle that weakened during the pandemic.

“Ultimately, once that muscle is rebuilt, the office is still going to be at the center of work, it's just going to look very different than it did … Now it's time to build that muscle up in a longer, leaner way.”