Telecommuting Falls Short of Expectations, Experts Say

SANTA CLARITA —  Telecommuting centers in Lancaster and Santa Clarita, which soared in popularity after the Northridge earthquake, are still operating nearly five years later. But for how long?

Although both are holding their own today, the centers’ backers are questioning their long-term future because of changing work patterns in Southern California.

It was only a few years ago that workplace pundits hailed telecommuting as an idea whose time had come.

The expectation was that employers would set up employees who lived far from corporate headquarters in satellite facilities equipped with computers, faxes, copy machines and video-conferencing equipment.

It would help air quality by getting cars off Southern California’s clogged freeways. It would yield greater productivity and job satisfaction by freeing workers from long, tiring, soul-draining commutes. Companies would find it a formidable recruitment tool.

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So much for predictions. By and large, telecommuting, at least as the trend was originally envisioned, hasn’t taken off.

Employers never warmed to the idea of paying rent on extra facilities without a demonstrable advantage. And management had lingering concerns about employees working without supervision: They might goof off.

The Antelope Valley Telebusiness Center in Lancaster, supported by the Los Angeles County government, shut down one of its two telecommuting facilities in the area in October--16 months after an anchor tenant, Health Net, pulled out.

Woodland Hills-based Health Net maintained about 30 workers at the Lancaster facility at 321 E. Ave. K-4 for 3 1/2 years. In July 1997, the health-care firm opted to open its own satellite office in that city 70 miles from Woodland Hills after its Antelope Valley employee count swelled from 30 to 46, following its parent company’s merger with Foundation Health Corp.

Health Net management felt it was more efficient to open its own facility in the area, said Jan Zlotowicz, vice president of human resources.

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Health Net, however, remains steadfast in its belief in telecommuting as a concept, she said. “Not having to drive two to three hours a day makes for happier, more productive employees.”

The original Antelope Valley telecommuting center, at 251 E. Ave. K-6, is still operating. But at 60% occupancy of its five private offices and 15 cubicles, it’s not fulfilling its potential, according to Evelyn Gutierrez, director of workplace programs for Los Angeles County.

“That’s a long way from where we were three years ago,” Gutierrez said. “In 1995, it was completely booked.”

Of course, the empty chairs at Antelope Valley’s telecommuting center and others doesn’t mean people aren’t working outside traditional offices.

They are, in great numbers. But instead of doing it in corporate-backed facilities, they’re doing it in their homes.

“Home-based workers are definitely on the rise,” said Jack Nilles, president of JALA International, a Los Angeles-based workplace consultant and author of a recent book on managing the virtual work force. Working from home has become more widespread, particularly among highly skilled or professional workers, with the rise of cheaper, faster, smaller computers and more sophisticated telephones, answering and messaging systems.

In the case of the Antelope Valley Telebusiness Center, advances in mass transit have played a role in its waning popularity, Gutierrez believes.

The commuter train began serving the Antelope Valley immediately after the quake, when freeways linking the area to downtown collapsed. Ridership fell off once the roadways were restored. But Metrolink has remained very popular with locals, particularly as the passenger cars were equipped with work tables and plugs. Commuters can now click away on laptops throughout the 1 3/4-hour commute to downtown Los Angeles.

“Metrolink has made it much easier,” Gutierrez said.

Gutierrez insisted that the Antelope Valley center is meeting operating costs of $4,620 a month, charging its users $380 monthly for a cubicle, or $17 a day. Private offices go for $420 a month or $19 a day.

But it must boost occupancy by six to 10 tenants to achieve sufficient profits to upgrade and replace equipment, a necessity. Gutierrez believes the answer lies in identifying more effective ways to market the center to potential tenants.

She said the county is asking local partners, such as the Antelope Valley Transit Authority, to help it promote the center with its ridership. It’s also working with local chambers of commerce to boost awareness, particularly among small businesses.

“We still believe there’s an opportunity here,” she said.

There haven’t been any discussions by the county supervisors about shutting it down, Gutierrez said.

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Speculation along those lines would be premature, since the county is in the early stages of this renewed marketing push, she said. “If we came back in six months or a year and found that after scouring the countryside, we didn’t find any new market niches, we might have to address the issue” of a possible shutdown, Gutierrez said.

The Santa Clarita Telecommuting Center, which opened in February 1994, has a more positive story to tell, but Connie Worden-Roberts, executive director of Transportation Management Assn., its nonprofit parent, also expressed trepidation about its long-term future.

At present, the 3,000-square-foot facility is full, with about 30 people from 11 organizations using its fully wired offices in the Valencia Industrial Center near Magic Mountain. In this case, many of the tenants are San Fernando Valley-based businesses.

It’s self-sustaining, without subsidies.

Louis Page, manager of the Santa Clarita Valley office of a security firm, Golden West K-9, a tenant since July 1995, is an example. The Valencia resident had no desire to battle the freeways every day to report to Pacoima headquarters 17 miles away, particularly since his job is to develop new business in the communities near his home.

The center has “allowed me to concentrate on the business up here without going all the way to the San Fernando Valley,” he said. Page also said it fits better with the 50 or so security officers who report to him, most of whom also live in the Santa Clarita Valley.

Likewise, Encino-based Blumhoff Design maintains a small office at the center, to have easier access to the graphics firm’s Santa Clarita Valley clients. “It’s not feasible to spend hours on the freeway,” President Willy Blumhoff said.

Worden-Roberts believes her center is still working because she’s stayed attentive to the changing marketplace and altered course when necessary.

For example, when Worden-Roberts began the Santa Clarita Telecommuting Center, after receiving a $320,000 grant from the Metropolitan Transit Authority in 1993, she set up 19 cubicles to serve as work spaces.

Immediately post-quake, Great Western Bank filled a lot of those spaces when it put 40 employees who lived in Santa Clarita in the center. But the company left when its regular facilities in Northridge were repaired.

In time, it became clear that there was little demand for cubicles, Worden-Roberts said. Tenants wanted private digs. So she chucked the cubicles and turned the space into a series of small, private offices, which currently rent for $450 a month for a 14-by-12-foot space and $350 for 10 by 10 feet.

Tenants have come and gone, but mostly it has remained full.

Most of her tenants have been employees of small businesses, as opposed to the large firms she originally thought would make up her customer base.

When telecommuting centers came into vogue, there was a rigorous state regulation requiring employers with more than 100 workers to have a transportation plan encouraging employees to take the train or bus or carpool to work. But in recent years, the regulations have become looser. Now the mandates apply only to companies with 250 or more employees.

This, coupled with the rise in home-based workers, has Worden-Roberts contemplating the center’s future warily.

“People have all this equipment in their own private homes now,” she said. “The day will come when they [telecommuting centers] may not be needed.”