Flexible workspaces to contribute US$ 254 billion to local economies in the next decade: study

According to a comprehensive socio-economic study of second city and suburban workspaces, the flex economy created by an increase in migration of flexible office space and co-working locations to areas outside of major metropolitan cities globally could contribute more than US$ 254 billion to local economies in the next decade.

The socio-economic benefits were analysed by Regus study provided to the local economies by the growth of flexible workspaces in secondary towns and cities and suburban locations of major cities in 19 countries, including India.

The study revealed that on average, 121 new jobs are created in communities that have a flexible workspace, with an extra US$ 9.63 million directly going into the local economy.

In India, this flex economy is expected to contribute an annual value of around US$ 14,663 million per annum (in terms of 2019 prices), out of which around US$ 5,737 million p.a. would be maintained by local economies. The other outcome of the study includes that there could be a total of over 979,000 people working at local, flexible workspaces across India, providing net additional employment opportunities for residents amounting to nearly 403,000 jobs.

The study was commissioned by Regus and overseen by independent economists, studied 19 major countries to explore into the economic and social impact of flexible workspaces in secondary and tertiary cities and suburban areas both now and through to 2029.

The big companies have adopted flexible working policies where they don't rely on a single, central headquarter and have increased the employees outside of the major metropolitan hubs in flex spaces. These changes act as the driving force in rise of the local working. The companies are mostly doing so to enhance employee wellbeing by letting people to work closer to home, and to save money and boost productivity.

Throughout the 19 countries analysed, the average individual workspace maintains 218 jobs, and in India, the average individual workspace supports 235 jobs. This comprises of the 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.

Further analysis predicted that, if current trends towards flexible regional working continue, these communities could see more than three million jobs created by 2029.

Mr. Steve Lucas of Development Economics, and report author said, "This study reveals a shift in jobs and capital-growth is 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."

Mr. Mark Dixon, CEO for Regus' parent company IWG, said: "When people commute into major cities their wallets commute with them. Working locally keeps that spending power closer to home. What this study shows is that providing more opportunities for people to work closer to home can have a tremendous effect, not just on them, but on their local area too."

Mr. Harsh Lambah, Country Manager, India, IWG, said: "This is a great testimony to the emergence of India as one of the hottest markets for the flexible working industry. Not just metros, even tier 2 and suburban locations are also contributing to this growth which we expect will continue into the foreseeable future. The study shows the potential of flexible workspaces by highlighting economic as well as the social impact for businesses as well as people working out of such spaces."

He added, "IWG is the only international player in the country with the largest network of 120 workspaces in 16 cities. Our customers are start-ups, small and medium-sized enterprises, and large multinationals and with shared workspaces, we provide them tailor-made options and communities to match their needs."

Regus was established in 1989 and is one of the pioneers of flexible workspace, helping businesses choose a way of working that's best for their people.

Regus is an operating brand of IWG plc: the holding group for several leading workspace providers. Other brands in the IWG portfolio include Spaces, HQ, No18 and Signature by Regus.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.