Flexible Workspaces to Contribute $13.7B to Local Canadian Economies in the Next Decade
- Flexible offices are increasingly located outside of metropolitan locations and this is transforming the make-up of local economies globally
- By creating jobs in secondary cities and suburban areas and boosting the local economy, an individual location in Canada can create $29.55M gross value added (GVA), $17.62M of which is retained locally
TORONTO, Nov. 19, 2019 /CNW/ - The increasing migration of flexible office space and coworking locations to areas outside of major metropolitan cities globally is creating a 'flex economy' that could contribute more than $13.7 billion annually to local Canadian economies in the next decade, according to the first comprehensive socio-economic study of second-city and suburban workspaces. It revealed that on average 144 new jobs are created in Canadian communities that contain a flexible workspace, with an extra $17.62 million per annum going directly into the local economy.
The analysis, commissioned by Regus and conducted by independent economists, studied 19 key countries to delve into the economic and social impact of flexible workspaces in secondary and tertiary cities and suburban areas both now and through to 2029.
This rise in local working is being largely driven by big companies adopting flexible working policies; moving away from relying on a single, central HQ and increasingly basing employees outside of the major metropolitan hubs in flex spaces. Most are doing so to improve employee wellbeing by allowing their people to work closer to home, and also to save money and boost productivity.
An individual flexible workspace or coworking centre in a suburban location can benefit the local economy in numerous ways, from creating jobs both inside and outside the centre, stimulating businesses and services in the nearby area, improving productivity and opening new working opportunities for those who live locally.
Jobs creation and the 'sandwich economy'
The average individual workspace in Canada sustains 238 jobs. This includes temporary jobs created during the fitting-out stage of the office space, permanent jobs to run the office, including reception, maintenance, cleaning etc., plus the jobs associated with the occupancy of the workspace.
In some countries, office spaces host more jobs due to a variance in their average size, as well as local regulations and cultural factor. For example, office workers in Germany are particularly resistant to higher office desk densities. Japan, on the other hand, sees the most jobs hosted from a single centre at 274.
The research also reveals that on average, 144 net additional jobs would be created in the Canadian local economy for each individual centre. This is because the presence of businesses and their employees provide stimulation to the nearby area. When businesses set up in suburban locations, they bring with them local goods and services, and employees who will spend in the local area, creating a 'sandwich economy.'
Economic impact
As well as direct job creation, flexible workspaces benefit the local area through an uplift in Gross Value Added (GVA), the measure of the value of goods and services produced in an area. The study found that an average flexible workspace in Canada will generate $29.55 million GVA each year, of which $17.62 million will go directly into the local economy. This is in part explained by the sandwich economy, but also created by improved career and earning prospects for residents and companies within the centre doing more business locally.
The USA was found to create the largest GVA of an individual centre, contributing $18.88 USD million into the local area. This is in part due to the different cost savings and productivity gains across countries.
For the greater good
Aside from the direct financial impact, local office space has been found to benefit workers and local regions in other, societal ways. This includes reducing the time spent commuting, with access to a local office space expected to save Canadian workers combined 9,348 hours (389 days) per year. This has wider benefits as a shorter commute has been shown to reduce stress levels, which can increase staff morale and resilience, as well as mental well-being.
Convenient office space has a further societal advantage, by providing working opportunities to people who might otherwise be unable to travel to an office. This could include disabled people, as well as those with caring responsibilities. As the labour markets tighten, local flexible workspaces could open new routes to top talent.
The next 10 years
As well as assessing the impact of individual centres, Regus also looked at the estimated potential of each market to host a larger, national portfolio of local flexible workspaces. It forecasts potential changes over the next decade, reflecting expected trends in workforce demography, technological change, and changes in business practices.
This additional analysis predicts that, if current trends towards regional flexible working continues, these communities could see more than three million jobs created by 2029. That's the equivalent to a city the size of Montreal. The forecast also predicts that $254 billion USD GVA will be added to local economies ($13.7 billion to local Canadian economies), enough to build 360 state-of-the-art hospitals1.
Steve Lucas of Development Economics, and report author, said, "This study reveals a shift in jobs and capital-growth moving outside of city centres, where it has been focused for the last few decades, into suburban locations. This can benefit businesses and people, from improving productivity and innovation, to reducing commuting time, which leads to improved health and wellbeing."
"This study shows that working closer to home not only has a significant impact on the environment, but also on the local economy. Access to flexible workspaces in smaller markets keeps spending power closer to home," says Wayne Berger, CEO, IWG Canada and Latin America (IWG owns Regus). "We're seeing an increase in demand from companies of all sizes for flexible space in smaller cities and towns. Larger businesses are opting for a 'hub and spoke' real estate model, while smaller enterprises want to cluster and collaborate — so many are choosing flexible workspaces close to home."
To download the full report visit https://www.regus.com/suburban-economic-survey
RELEASE NOTES
The Regus study analyzed the socio-economic impact of flexible working in 19 countries: Australia, Austria, Belgium, Brazil, Canada, China, France, Germany, India, Italy, Japan, Netherlands, New Zealand, the Philippines, South Africa, Spain, Switzerland, the United Kingdom and the United States.
ABOUT REGUS
First established in 1989, Regus is one of the original pioneers of flexible workspace, helping businesses choose a way of working that's best for their people.Now spanning the world with over 3,000 locations, Regus' global network of bright, inspiring workspaces allow modern businesses to work where, when and how they want, in a more agile way. Regus provides businesses with the flexibility to grow without risk or commitment, and attracts a diverse network of 2.5 million people, from entrepreneurs and SMEs to multi-national blue-chip companies.
Regus is an operating brand of IWG plc: the holding group for a number of leading workspace providers. Other brands in the IWG portfolio include Spaces, HQ, No18 and Signature by Regus.
For more information please visit:
www.regus.ca/
https://www.facebook.com/RegusGlobal/
www.linkedin.com/company/regus
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Based on the cost to build Queen Elizabeth Hospital Birmingham (QEHB) in the UK, which cost £545 million and opened in 2010 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/768712/University_Hospitals_Birmingham_NHS_Foundation_Trust_Annual_Report_and_Accounts_2017-18.PDF#page=9 |
SOURCE Regus
Media Contact: Linda North, NorthPR, [email protected], 416-708-8012
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