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The most common question San Francisco Fed President Mary Daly is asked about the city when she\u2019s traveling outside of it is whether a \u201cdoom loop\u201d has descended on the tech hub. <\/p>\n
That\u2019s amid reports of people fleeing San Francisco during the pandemic to lower-cost areas and working from home, leaving office buildings increasingly vacant and nearby businesses bereft of customers.<\/p>\n
But during an appearance at the Commonwealth Club World Affairs of California<\/a> in San Francisco on Monday, Daly pointed out that the dot-com bust more than 20 years ago gave rise to similar predictions of doom for the Bay Area. <\/p>\n She went down a list of what San Francisco has going for it, including a highly educated workforce, good infrastructure and its \u201cinnovative entrepreneurial spirit.\u201d In fact, AI and other companies are looking for real estate again in the city, and more people are coming back to work.<\/p>\n \u201cEvery week I come, traffic is getting worse,\u201d Daly quipped. \u201cThat\u2019s a good thing, frankly, sometimes.\u201d <\/p>\n Still, data from property adviser CBRE<\/a> shows that San Francisco\u2019s office vacancy rate of 37% is the highest of any big U.S., according to the Financial Times<\/em><\/a>.\u00a0<\/p>\n Daly also acknowledged that there\u2019s more work to do to make the city\u2014as well as the surrounding area\u2014better and help it reach its full potential. And she sees a role for San Francisco\u2019s business community, which isn\u2019t a passive bystander.<\/p>\n \u201cIf you\u2019re the founder of something and you\u2019re part of this, then let\u2019s change it. This isn\u2019t being done to us, we live in the city and so together we can help and assist,\u201d she said.<\/p>\n When asked how CEOs and founders can help, she replied, \u201cTalk about what you need to fix and also encourage your people to come back to work.\u201d<\/p>\n Hybrid work seems to be a compromise between companies and workers, and Daly said she is personally in favor of hybrid, noting that young employees also need to work with older employees to help grow and advance their careers.<\/p>\n But even hybrid work has received pushback from the tech sector. A study looking at the effects of return-to-office mandates at giants like Apple<\/a> and Microsoft<\/a> found that many workers left their companies<\/a>. That\u2019s as Microsoft mandated 50% of the week in-office and Apple required just one day a week.<\/p>\n Similarly, nearly half of Dell\u2019s full-time workforce<\/a> in the U.S. rejected returning to the office and would rather work from home than get promoted.<\/p>\n A major obstacle is that a lot of employees have moved farther away<\/a> from the office. The average distance from work for employees who were hired in 2023 is now 35 miles, up from 10 miles in 2019, according to a Stanford University and Gusto\u00a0study<\/a>\u00a0published in March.<\/p>\n Meanwhile, Patagonia gave some employees just three days<\/a> to decide whether they\u2019ll relocate close to the office or quit. The company began piloting a \u201chub\u201d model last year<\/a>,\u00a0in large part because of negative feedback it had received about being fully remote, Corley Kenna, head of communications at Patagonia<\/a>, told Fortune<\/em> earlier this week.<\/p>\n \u201cWe wanted to be really intentional, and we wanted to be sure that this was the right model,\u201d she said. \u201cWe knew it would affect a lot of people, and so we took it really seriously to think through all the different ways we could care for our people. So think it\u2019s a fair call-out, but I think that\u2019s our real answer.\u201d<\/p>\n<\/div>\n