Dive Brief:
- Tens of thousands of California state government workers are heading back to the office this week as a mandate from Gov. Gavin Newsom requiring agencies to make four in-office days the default takes effect.
- The policy could expose the inadequacy of the state’s office space to accommodate workers, say consultants and others who’ve analyzed workers’ changing views over what constitutes a productive work environment. “Employees need space to focus, space to collaborate, and space to connect but most offices manage one, maybe two,” says Adam Morgan, co-founder of furniture and design company Bureau.
- The state’s mandate has drawn pushback from local unions and other groups that say the requirement will hurt recruitment and retention while increasing costs.
Dive Insight:
Newsom’s return-to-office order took effect July 1. It requires California state agencies that still offer hybrid arrangements to make four in-office days the default, increasing from the two-day office schedules that many employees in the state have been operating on, according to reports. The state employs more than 224,000 full-time workers, according to a release by the governor’s office. The mandate will impact approximately 109,000 of those workers, the Sacramento Bee reported.
When he issued his executive order last year, Newsom said workers spending more time in the office will help improve accountability, collaboration and innovation, but that claim has never been fully supported, according to a 2025 California State Auditor report. The report found that the governor’s office had not gathered key data on job performance, service delivery, office needs or costs.
The report says California could save as much as $225 million annually if employees worked in the office only two days a week by allowing the state to shrink its office footprint by 30%. State policy requiring dedicated workstates for employees who are in the office more than half the week would limit that opportunity, the report says.
In May, the Service Employees International Union Local 1000, which represents 96,000 state employees, filed an Unfair Labor Practice Charge with the Public Employment Relations Board regarding the mandate. On June 24, the charge cleared the initial review process and PERB officially issued a complaint. The complaint won’t have much effect in the short term; while the case is being looked at, workers will need to adhere to the four-day-a-week schedule.
Research in the years since workers started returning to the office after the COVID-19 pandemic shows workers and managers have changing views of what productive office environments look like. Many corporate real estate operators and workplace managers have begun implementing flexible workspaces that can better accommodate employee productivity, says Morgan.
"California's return-to-office mandate [is] a real-world stress test,” he said in a statement. “The question isn't whether people show up, it's whether the buildings are built for how people actually work.”
If there’s a gap between what employees expect and what the office offers, it could impact worker performance, he said. “That gap doesn't just frustrate people,” he said. “It undermines the case for being there, and it gives employees a reason to disengage the moment they walk through the door.”
Research supports that view. Reports by property management companies JLL and ISS show corporate workplace managers recognize the importance of providing flexible, amenity-rich space for workers, although they do not always provide it.
More than 80% of business leaders in an ISS survey believe that workplace space optimization has a large impact on organization performance, but 68% say economic factors weigh more heavily on their planning.
JLL’s survey had a similar finding. Although portfolio optimization is a top objective for corporate real estate leaders, cost reductions remain a top issue.
“The most effective utilization strategies [include] design changes,” says the JLL report, which looked at technology investments as a way to optimize office use.
“The fix isn't more buildings,” said Morgan, “it's smarter use of the ones [California’s] agencies already have: modular, flexible design that can be reconfigured in days, not months. That's what … state agencies walking into this mandate right now need to be thinking about.”
