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Wall Street Bosses Want Their Workers Back. That's Good For The King Of Falafel

Jun 29, 2021
Originally published on June 29, 2021 6:47 am

You might assume that Wall Street boss James Gorman and falafel-maker David Shadaha don't have much in common. But after months of remote work, they share a goal: to get bankers back into their New York buildings.

With a few exceptions, major Wall Street banks are already moving to resume office work as long as workers are vaccinated. Gorman, who is Morgan Stanley's chairman and CEO, expects most of his staff to be back by Labor Day.

"I'll be very disappointed if people haven't found their way into the office," Gorman said in a video posted by Morgan Stanley. "And then we'll have a different conversation."

That may not be great for every Morgan Stanley employee, but it's good news for Shadaha and others whose livelihoods depend on the legions of white-collar workers across Manhattan.

Shadaha operates his King of Falafel & Shawarma cart in Midtown, across the street from the investment firms BlackRock and Evercore.

When the pandemic emptied out New York City streets, Shadaha had to put away his cart. He spent five months as a GrubHub deliveryman.

"It's been a disaster," Shadaha says of the pandemic's impact.

Today, there are signs of recovery in Manhattan. But for every coffee shop that is open for business, another one has closed its doors for good. The same is true of delis and bakeries.

Pedestrian traffic is coming back, but it's down 70% from what it was before the pandemic, with large parts of international tourism still shut down.

That makes people like Shadaha even more dependent on office workers. He estimates he is making only about half of what he made in February 2020.

"I'm just working only for the offices here," he says, gesturing to the skyscrapers that line Park Avenue. "So, if it's nobody here, it's like business is dead."

Goldman Sachs CEO calls remote work an "aberration"

Soon, Shadaha should start seeing more customers.

Financial firms may have raked in record profits during an unprecedented year of remote work, but for a while now Wall Street executives have been dropping strong hints that they want workers to return.

In February, for example, Goldman Sachs CEO David Solomon referred to remote work as "an aberration that we are going to correct as quickly as possible."

Bankers have already been back at Goldman Sachs since mid-June.

Blackstone executives have asked fully vaccinated workers to return. Citigroup's head of human resources says the plan is for 30% of its staff to be in the office this summer.

Morgan Stanley CEO James Gorman and JPMorgan Chase CEO Jamie Dimon listen during a House Financial Services Committee hearing on April 10, 2019, in Washington, D.C. Gorman has encouraged his workers to return to the offices by Labor Day.
Alex Wroblewski / Getty Images

That Wall Street is coming back so early is no surprise to those who work in the industry. A banker's job is high stress and high stakes with long days spent in busy offices or on crowded trading floors. The upside comes in the form of perks and handsome pay, like being able to expense pricey dinners or black cars home.

It was the type of environment that James Davies, the global head of Deutsche Bank's institutional clients group, had grown accustomed to, which made it such a shock when he came back to a partially deserted office.

"You know, having worked in the industry for 25 years, it was somewhat strange to walk onto the trading floor on a Wednesday morning and see, I'd guess, six to 10 people here, versus the hundreds we would normally have," he recalls.

Today, he estimates it is at 40% occupancy, but climbing.

For Davies, it is a decision borne out of convenience and cultural necessity.

"There is a real benefit to people being in the same place," says Davies, noting as well the importance of what he calls "the soft cues of business."

Not every bank will expect its workers back five days a week. UBS this week said it would adopt a hybrid work model. And French bank BNP Paribas, which has 14,000 employees in North America, also plans to provide flexibility.

"We are expecting everyone will come into the office every week, but obviously not full time," says Claudine Gallagher, the chief human resources officer for BNP Paribas' corporate institutional banking group in the Americas.

Why Wall Street matters to New York

Boosting the number of traders and bankers working at New York offices matters more than just preserving Wall Street's culture.

A 2021 report from the Office of the New York State Comptroller estimates the securities industry employed 179,900 people, or 19% of New York City's workforce.

That means scores of ancillary businesses depend on Wall Street, such as Schumer's Wine and Liquors near the investment bank Jefferies and around the corner from Shadaha's cart.

Larry Duke, who has owned the shop since 1978, says he never considered closing, even when his business dropped by nearly 80%. He laid off staff, renegotiated his lease with his landlord and took out two loans through the Paycheck Protection Program to stay afloat.

Larry Duke, owner of Schumer's Wine and Liquors, sits by his dog, Klaus, as they wait for customers. Duke kept his store open during the pandemic even as the city emptied out.
David Gura / NPR

Still, business hasn't bounced back completely.

"It's a roller coaster, and there is no defining reason why you have a good day, or why you have a bad day," he says, with his German shepherd, Klaus, nearby.

But things are getting better as the summer progresses.

Not too far away, Shadaha has a line of customers waiting for their lunch orders. Workers are filtering back, and they want their usual wrap or platter just like the old days.

"It feels like life is coming back," Shadaha says.

Copyright 2021 NPR. To see more, visit https://www.npr.org.

RACHEL MARTIN, HOST:

Banks and financial firms drive New York's economy. And for more than a year, their offices in the city's skyscrapers have been mostly vacant. Now, as NPR's David Gura reports, they face a reckoning; so do the shops and restaurants that depend on these bankers for business.

DAVID GURA, BYLINE: Wall Street is not for the faint of heart. The high stress, the long hours are a point of pride. At a recent conference, the CEO of Morgan Stanley didn't beat around the bush. James Gorman said there's a deadline.

(SOUNDBITE OF ARCHIVED RECORDING)

JAMES GORMAN: Labor Day, I'll be very disappointed if people haven't found their way into the office, and then we'll have a different kind of conversation.

GURA: The pay, the perks, they make this job palatable. When you work late, you can put dinner on a company card. You can take a black car home. Bankers normally spend a lot of time in the office and that's where they learn the ropes.

JAMES DAVIES: There is real benefit to people being in the same place.

GURA: James Davies oversees a massive trading floor at Deutsche Bank that used to be packed with people. When he came back to the office in July, the place was unrecognizable.

DAVIES: You know, having worked in the industry for 25 years, it was somewhat strange to walk onto the trading floor on a kind of Wednesday morning and see, you know, I guess six to 10 people here versus the hundreds we would normally have.

GURA: But they are coming back. Davies estimates it's at 40% capacity now. That's one barometer of life getting back to normal. Another one he keeps an eye on is how business at his favorite coffee shop has changed since he's been back at work.

DAVIES: I would walk in and I would be the only person there that would pass through there in half an hour. I just went down to grab a coffee now, and the place is absolutely full.

GURA: They are green shoots in midtown. The traffic is back on the sidewalks and the streets, but for every coffee shop that's open, another one is closed. The same thing is true of delis and bakeries. The trillion-dollar question is, will it all come back? In this part of Manhattan, pedestrian traffic is down 70% from what it was pre-pandemic.

DAVID SHEHADA: What's up, brother?

GURA: David Shehada (ph) is back in his food cart selling falafel on the corner of 53rd and Park. That's a block or two from some of the largest financial firms in the world, like BlackRock.

SHEHADA: Hey, how are you doing?

UNIDENTIFIED PERSON: Can I have a falafel pita (ph)?

SHEHADA: Spicy?

UNIDENTIFIED PERSON: Yeah.

SHEHADA: Hot sauce tahini.

UNIDENTIFIED PERSON: No onion (ph).

SHEHADA: No problem.

GURA: He says business is still 50% of what it was before the pandemic, and tourists won't make up the difference.

SHEHADA: I'm just working only for the offices here. So if it's nobody here, like, the business is dead.

GURA: Halfway through the pandemic, Shehada closed the cart. He spent five months as a GrubHub deliveryman. Financial firms want workers back, but vendors and small businesses need them to come back. And what's at risk is a lot of what makes New York New York - busy bankers ducking out for great falafel from a food cart or a good bottle from Schumer's Wine & Liquors, a shop Larry Duke has owned since 1978.

Did you think about closing or you stayed open the whole time?

LARRY DUKE: I never thought about closing.

(SOUNDBITE OF DOG BARKING)

GURA: Duke and his German shepherd, Klaus (ph), stuck it out, and when his business fell nearly 80%, he laid off staff. He made a deal with his landlord. Duke took out loans. Business still has not bounced back completely.

DUKE: It's a rollercoaster. And there's no defining reason why you have a good day or why you have a bad day.

GURA: Of course, it helps banks are bringing workers back, but at some firms, it's just three days a week. For Duke and for the other businesses along Park Avenue that have made it through, three days is better than none. David Gura, NPR News, New York. Transcript provided by NPR, Copyright NPR.