News & Analysis

Orwellian government bombshell: World’s markets are an accurate depiction today

Andrew Saks, Thursday, 17 June 2021

Office space has long been a taken-for-granted component of the corporate world.

The daily commute by tens of millions of British white-collar workers has been a staple of everyday life, is featured in everyone's childhood memories of suited parents heading out of the door at 7.30am to the Underground station or signified by the rolling sound followed by a familiar clunk as the garage door closes and the base-specification station wagon supplied by the company heads off to take its usual slot in the office parking lot.

Not much has changed since the days in which Leonard Rossiter first lampooned the daily act of commuting, making a long-running comedy in his character, Reginald Perrin, a frustrated middle-manager whose daily life of monotony drove him to increasingly high levels of despair.

"Eleven minutes late, defective junction box, New Malden" was one of his regularly trotted-out excuses upon arrival at the fictional Sunshine Desserts every morning.

Today, however, the humor is lost and most commuters are perhaps too young to remember Reginald Perrin and his daily interactions with incompetent manager CJ in their dilapidated South Bank office, and modern serviced offices provided in an almost completely uniform fashion by large, publicly listed companies in which even the largest of corporations provide office on a 'space' basis rather than companies owning their own individual real estate, meaning that open-plan uniformity has pervaded every day of every person in every business sector for many years.

Offices are the secret hideaway for henpecked husbands. They are the sanctuary from the harsh reality of life without gossip obtained whilst lining up at the water cooler. They are the backbone of British entrepreneurism and leadership, and the subject of endless life experience-based wisdom.

During yesterday evening, perhaps rather predictably, an odious memorandum was leaked from the British government's Whitehall headquarters - which is, rather ironically, an office, stating that facemasks are forever, self-isolation and quarantine is to stay, and that working from home is also permanent.

There is even talk that the government is attempting to rush through laws to ensure that employers cannot insist on office-based work going forward.

Many critical thinkers knew this was likely right from the beginning, however now, a large percentage of the British workforce has aligned itself with what was glaringly obvious back in March 2020.

As the once world-beating British workforce languishes in front of the television and the productivity figures for many firms in many sectors resemble those of Reginald Perrin's dystopian employer 'Sunshine Desserts', the industrious and focused regions in the Asia Pacific nations are working at full capacity.

There are no lockdowns and no pyjamas all day whilst lying in bed with a laptop, occasionally wiggling the mouse to keep the 'attendance' pie chart happy.

In India, the Nifty index and the SENSEX index are both flying high, and large outsourcing companies with a global presence are doing exceptionally well.

Tata Consultancy Services, for example, is one of the world's largest professional services companies and rivals the global 'Big Four', those being KPMG, Accenture, Deloitte and Ernst & Young. In many areas, Tata Consultancy Services is even bigger.

Its motor division, however, Tata Motors, is declining badly, largely because of its British problem child Jaguar Land Rover, which since the dark days of the trade union-infested 1970s when Derek "Red Robbo" Robinson would have everyone out on strike if the management told them to stop playing cards on the nightshift instead of working has been a money pit to every subsequent owner.

Tata's performance is important. Whilst the British government continues with its will to wreck the fabric of society and the national economy, those 'work from home' mandates and those adhering to them could easily lead to the systematic replacement of office staff by large corporations who are desperate to have a fully functioning workforce by hard-working people in India, provided by large scale outsourcing contracts via companies such as Tata.

Thus, confidence in Tata's consulting arm is up, whilst its motor manufacturing division is in dire straits. Range Rover, one of Jaguar Land Rover's key brands is often listed at the bottom of customer satisfaction surveys due to unreliability.

Lexus, a rival brand owned by Toyota, a Japanese company, and Volvo, a Swedish company, are producing the most reliable and advanced SUVs at the moment.

Neither Japan nor Sweden had any form of lockdown or social distancing rules. In fact, there was no evidence of any restrictions and life was normal in both nations as it always has been. I was in Sweden in January, and it looked and felt like 2019. Next time you drive effortlessly past a stationary Range Rover whose high visibility vest is once again being used whilst waiting for the recovery service, ask yourself if the software testers and electronics engineers were flat out on their backs at home during the 2021 model year production run.

IWG, a British firm that leases office space, is once again in a jam. Its shares have declined by 2.7 points this morning once again, as confidence in a company whose core business relies on renting physical offices in a nation in which the government is working against the potential of industry is not something investors have confidence in.

These are the bigger metrics. What will happen when the small businesses finally give up and realize they will never be allowed to welcome customers, and if they are, it will be severely restricted? What about those city center cafes that serve office workers? They have been subjected to a year of not being allowed to open, and now they will be in lockdown after lockdown, and have no customers if offices are empty.

It could come to pass that overseas investors such as the owners of real estate developer Ballymore could buy the offices. Ballymore is owned by APAC shareholders and is involved in enormous projects across London. Its shares are up 13 points today.

The public is smart. The stock prices are very reflective of mood and sentiment.

My office? It's lovely, thanks for asking.



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