Table of Contents
The US economy has a new problem. Companies are shrinking their office space because more people work from home now.
This will cause trouble for banks that loaned money to companies to buy office buildings. It will also be trouble for small businesses like restaurants that serve office workers, and cities that need the tax money from the office buildings and businesses.
Almost 20% of office space in the United States is now empty, worse than the 2008 financial crisis. In Los Angeles and San Francisco, more than 25% of offices are empty.
As the demand for office space goes down, building owners don’t get enough rent money to pay back their loans from banks. It also makes the buildings difficult to sell, so they lose value.
If the building owners can’t repay the loans from the banks, it is a big problem for the US banking system.
The high number of vacant offices is already causing problems in city areas. Businesses like dry cleaners, restaurants, and convenience stores that rely on office workers are struggling.
Public transportation systems in cities also have financial problems because fewer people are commuting.
Some building owners are considering changing the office buildings into apartments, but that could be expensive.
Others say that workers should return to the office instead of working remotely. However, many workers do not agree with that idea.
Vocabulary
- Economy – the system according to which the money, industry, businesses and trade of a country/region are organized; the supply of money, production of goods and purchase of goods; the flow of money between people, businesses and government
- Shrink – to become less or smaller; to decrease
- Cause – make something (usually bad) happen; create
- Loan – Money that is borrowed from someone or a bank and needs to be paid back with interest
- Serve – To perform duties or tasks for someone or something; to work for someone
- Tax – money that a government requires people or businesses to pay
- Crisis – a time of intense difficulty or danger; emergency; hardship
- Demand – a need for goods or services that customers want to buy or use; a need or want; a need for something to be sold or supplied
- Value – how much something is worth in money; “price”; the importance, worth, or usefulness of something
- Repay – To give back or return money that was borrowed or owed; pay back
- Vacant – Empty; not occupied; not filled by anyone or anything
- Convenience store – a small shop that sells simple foods and small important items and is open long hours
- Rely on – to need (someone or something) for support or help; depend on
- Struggle – to fight; to try very hard to do a difficult thing; strain
- Public transportation – Buses, trains, and subways that are available for all people to use
- Commute – the travel or journey between home and work or home and school
- Consider – to think about carefully; to take ‘something’ into account when thinking or deciding;
- Work remotely – to work outside of the office, usually from home or a cafe
Quiz
Discussion Questions
- How do you think the high number of vacant offices affects the local economy and small businesses?
- In your opinion, should building owners consider converting office buildings into apartments? Why or why not?
- What strategies could businesses like dry cleaners and restaurants adopt to overcome the challenges posed by remote working?
- What are some potential advantages and disadvantages of workers returning to the office instead of working remotely?
Original Story
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