New research suggests many UK firms are regretting pandemic-era decisions — from shrinking office space to hasty AI job cuts.
After years of experimenting with remote work in the wake of the pandemic, many UK firms are settling on a happy medium: hybrid work.
But new findings from Irwin Mitchell’s Office Occupiers Report 2025 show that two-thirds of organisations now feel they may have been too hasty when downsizing their office space over the past few years.
But lack of space isn’t the only issue facing post-remote businesses. Studies show leaders are second-guessing many earlier strategic decisions, including AI adoption.
The findings suggest some businesses are responding too quickly to fleeting trends. And in doing so, are they making avoidable mistakes?
The office comeback – and a change of heart
In its latest report The Office Occupiers Report 2025, law firm Irwin Mitchell surveyed over 500 senior decision-makers in the UK to understand current attitudes to future office requirements, areas of concern, and opportunity.
Most notably, the report found that 63% of organisations believe they downsized office space too aggressively in response to the switch to hybrid or remote working.
This has triggered a shift across the country, with 45% looking to re-expand their office spaces over the next 12 months. Comparatively, just 10% are considering further reductions to office space.
The reasoning behind the office revival is also highlighted by the survey. 72% of employers noted an increase in employees working from the office, with social capital listed as a reason for staff returning to the office. Collaborating with colleagues in-person can be vital for career progression (although firms must be careful not to lean into presenteeism).
In addition, there is an economic element to the return-to-office trend. Rising costs are increasing the pressure on employees to be productive. 43% of businesses cited rising inflation and higher interest rates are major concerns for the next 12 months.
Other concerns include escalated employment costs and risks (30%), adverse tax policies (26%), and mounting property costs (21%) likely caused by the rise in business rates.
The great AI regret
Another area in which leaders appear to be backpedalling is AI. Software company, Orgvue revealed that 39% of business leaders made redundancies after replacing staff with AI solutions. Over half (55%) of them now feel that was a mistake.
Brands are rushing to deploy AI agents, perhaps overzealously, to boost productivity and cut costs. It’s understandable, as AI has introduced the most revolutionary tech to hit the mainstream in years.
However, both studies show that whether it’s workspace or workforce, snap responses to long-term shifts are proving costly for businesses.
AI adoption, like office strategy, requires careful alignment with business goals and robust planning around people and processes.
Why business strategy needs a pause button
While it’s true that we’re in a period of rapid change, many decisions made in the heat of the moment are already being reversed. From office downsizing to headcount cuts, the fallout from hasty choices is starting to show.
Blindly following trends without aligning them to your long-term business strategy can pose serious risks. It can affect your company culture, reputation, and even your bottom line. What works for a tech giant might not translate to smaller startups with different goals, teams, and customers.
One positive of tech advancement is the rise of data-based decision making. Irwin Mitchell reports that 80% of companies are now actively tracking office attendance, using those insights to reshape their hybrid strategies.
When experimenting with AI tools, businesses should follow a similar approach. They may also make use of flexible leases, such as coworking membership, to avoid backing themselves into a corner when it comes to office decisions.
Ultimately, reactivity rarely leads to successful outcomes. Considered, evidence-based planning is the way to go. Trends can be inspiring, but remember that there’s no one-size-fits-all when it comes to planning your business strategy.
