As banks slowly nudge staff back into their offices, it turns out that it’s not just toilet plumes that are causing stress: having people in COVID-proofed buildings is also very expensive.
Deloitte Consulting puts the ‘seat’ cost of a banker in an office with all the necessary virus precautions at 50% higher than the seat cost of a banker in an office without. Plexiglass screens might seem cheap, but not when you need thousands of them. There’s also the need for ‘lids’ for toilet cubicles to limit plume-spread, for hand towels instead of hand dryers, for new receptacles to dispose of masks, and for ventilation upgrades so that virus-heavy air isn’t circulated around buildings. Jobs could be created in the virus-proofing process, albeit not ones that most people in finance would rush to fill: Bloomberg foresees a new breed of compliance/security person tasked with patrolling floors and ensuring employees comply with new rules by not sitting too close together/walking without masks/crowding into meeting rooms.
When these additional measures are implemented, Deloitte suggests the ‘seat cost’ per bank employee could rise by 50%, to between $10.5k and $18k (on trading floors this is far higher when the cost of technology is added in). For banks with the largest offices in London and New York this means a cost of tens of millions at a time when – even before the virus – most banks were cutting costs.
The danger, then, is that COVID-precautions themselves could precipitate a new and deeper round of cost cutting, and the automation-away of jobs that can be done by machines. Will staying at home make any difference though? The new costs look suspiciously fixed: most banks are investing in the expectaiton that up to 50% of staff will return in the near term, irrespective of whether everyone stays at home or not.
Sarah Butcher – Read more on efinancialcareers.com
