26th March, 2021

Co-working spaces – a critical part of the new normal?

What will the workplace of tomorrow look like and how has the pandemic changed things? Co-working spaces may offer a clue.

What started as a novelty has become somewhat uninspiring. As parts of the world enter their thirteenth month of working from home, people are starting to crave human interaction.

Some people miss going to work.  And given how important the social aspects of work can be for some, it makes sense that some workers would be quite happy to get back to the office.

So as we enter the ‘new normal’, the question remains: what is the future for the office space?

With some businesses giving up leases or selling property during lockdowns, many are now turning to more flexible options for renting space for meetings and collaboration. As a result, there’s no denying that co-working spaces have become a feature of the modern workplace landscape.

We spoke to Jeremy Ellis, co-founder of LaunchPad, who shared his thoughts on the future of the co-working space and its role in this next new normal.

Spaces for innovation

A global lockdown inspired thousands of people to turn their side hustles into small businesses. But where are they to learn and grow if they’re stuck at home?

Corporations are using co-working spaces as centres of innovation too, moving smaller teams out of the bureaucracy of the large organisation.

Part of their magic is having a dozen industries under one roof where serendipitous moments can spark ideas and foster more innovation across the board.

“Innovation comes from those chance interactions,” said Ellis. “Victoria has a reputation of being the centre of innovation, but with everyone working from home we’ve seen a massive drop in innovation and creativity.”

Mixing the very new with the veterans

Co-working spaces have long been sought after by bigger businesses looking to tap into the fast pace and energy of a startup.

In a co-working space that focuses on community and culture, people feel more valued and part of a team – whether they work for the same company or not.

Similarly, with the right mix of businesses, startup and growth companies get to learn from more established organisations.

“It’s about bringing many cultures together into a community where they can leverage off each other and become more than the sum of their parts.”

Hybrid offices for remote flexibility

A recent study showed that 54 percent of US workers said they’d leave their current job for one they could do remotely. But that need for flexibility has to be balanced by the risk of losing the culture and collaboration you get with face-to-face working.

Ellis explained that around 90 percent of businesses coming to LaunchPad have about two-thirds of their team working remotely, but want time to work together in the week too. This so-called ‘hybrid office’ can only be facilitated by co-working spaces.

“This is essential to create culture, training, connection and provide effective leadership,” he said.

So long, CBD?

With smaller and more flexible offices come cheaper and less committed rents. Businesses are realising the setups they can get on the city fringes and are trading their expensive offices in high-rise buildings for smaller spaces in the suburbs. It raises the question: is the CBD as we know it a thing of the past?

As companies realise the benefits of hybrid offices, commercial leasing in city centres may continue to be disrupted.

“The majority of co-working spaces are city fringe and I anticipate they’ll do well.

“The CBD is going to be a real challenge,” Ellis predicted.

READ: Are management agreements the next big thing in co-working?

Flexibility, community, wellbeing

With the flexibility of the new working environment, we’ll find time to focus on things that matter more than commuting to the CBD.

Ellis believes we might expect to see communities thrive as a knock-on effect, rekindling the neighbourly relationships we haven’t seen for decades.

For Victorians, the timing is perfect, as the government is encouraging ‘20-minute neighbourhoods’. Under this model for urban planning, everything is within a 20-minute radius of someone’s home: shopping, school, recreation, cafés and work. Co-working spaces could have a huge part to play in this.

“Victoria has the largest percentage of co-working spaces in Australia – most people have a space not too far from their home, so it’s do-able,” Ellis agreed.

Tempering health and safety issues

As buildings were shut down during COVID, people were forced to work from home – whether that was the most effective solution or not. Ellis explains how this has opened up a whole host of issues – occupational therapists are seeing far more back problems caused by people working in the wrong environment.

“Some managers may like having everyone working from home – if they give a blanket go-ahead to work in co-working spaces, the costs go up again.”

But again, it’s the pendulum swing.

“Some people are predicting major workplace issues related to mental health, and back and neck issues that constitute major work-cover claims.

“That has some long-term implications.”

Once these longer-term costs begin to rear their heads, offering a co-working space may seem like the less expensive option than trying to deliver a decentralised occupational health and safety training course, tailored to each home office’s needs.

Stay in the know

Sign up for added insights and business-critical news from MYOB.

A valid email is required
Congratulations! You've successfully subscribed to our newsletter!
Something went wrong

Scaling up and down

There’s been a huge shift from permanent employees to freelancers since the pandemic, with 32 percent of organisations swapping full-timers for contractors.

It’s a sensible swap to make, with the future for business so uncertain – and this is true for office spaces, too. Many co-working spaces are adding more flexibility to their already elastic model – those hiring offices in shared space are put on a rolling, monthly contract.

Where to from here?

In a post-pandemic world, we might expect to see co-working spaces begin to boom as people look for an option that’s not working from their bedrooms or a return to a big-office grind.

As more businesses rub shoulders, could this be the beginning of ‘innovation flashpoints’ that drive developmental leaps in the startup community?

Co-working spaces maximise opportunities for companies to learn from each other, share experiences and knowledge, and create communities of people who might have otherwise remained strangers.