The chancellor has warned bosses that staff may quit if they are not allowed to work from the office as the UK emerges from lockdown.
Rishi Sunak told the Telegraph that employees would “vote with their feet” and could consider leaving for a rival if made to work from home full time.
A number of companies have announced plans to close offices prompting fears for city centres.
But now the chancellor has urged firms not to abandon the office altogether.
Mr Sunak told the newspaper that home working is no substitute for an office environment with “people riffing off each other”.
“You can’t beat the spontaneity, the team building, the culture that you create in a firm or an organisation from people actually spending physical time together,” he said.
The chancellor argued that an office environment was particularly important for younger workers looking to understand how a company works.
He said it was “important that we try and get back to a good degree of that”.
Although he acknowledged that hybrid working, using tools like Zoom to communicate, could work for some businesses.
His comments come amid concern from businesses that rely on busy cities that workers may spend more time at home.
More than 17,500 chain stores and other venues closed in the UK last year, but there are fears that the true impact of the pandemic on High Streets is still yet to be felt.
On Thursday, building society Nationwide revealed plans to allow 13,000 of its staff to “work anywhere” as it closed three of its offices in Swindon, while Santander announced plans to reduce the amount of office space it rents in London and move its headquarters from the capital to Milton Keynes.
Santander will close a number of its offices across the country and ask staff to work from home more often or travel in to one of its remaining offices.
The bank also said it would close 111 of its branches in yet another blow for the High Street.
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Rishi Sunak warns business that people may quit if forced to work from home
