The demand for on-site office work is shrinking–and the need for office space is going along with it. The quick takeover of the virtual workplace has become a defining business talking point. Having said that, what does this mean for the modern business world?
The answer is complicated.
The Current State of Office Space
The 2022 Office Space Report stated that 46% of businesses surveyed reported using less than half their office space, while only 11% said they utilize all available office space. This phenomenon is just the tip of the iceberg. Furthermore, of the businesses surveyed, 46% said they would be cutting down on their office space in 2023, and 60% of those reporting said they would be reducing their office space by more than half.
Downsizing Space due to Remote/Hybrid Work
Companies are downsizing their office spaces in response to the growing number of employees looking to work a hybrid schedule. For some business leaders, keeping remote employees engaged from any location is their biggest struggle. For others, it is scaling up their technology to provide hybrid opportunities that make them attractive to talent. Regardless of the industry, the new business world requires new ways of keeping the workplace connected virtually.
Part of this new thinking has led to businesses re-examining the costs associated with running their business. Mark Dixon, CEO of workspace company IWG, notes some companies could expect to save 50% on their real estate costs by switching to a hybrid workplace. Global Workplace Analytics, the research firm, reported that allowing employees to work from home for half of the week can yield savings of $11,000 per employee to the company. Most savings result from increased productivity, lower real estate costs, reduced absenteeism and turnover, and better disaster preparedness.
Businesses can only achieve savings by opening the door to a more hybrid work environment by embracing technology that makes communication as reliable and fluid as possible. This versatility of technology allows companies to remove the cost of unnecessary office space and better utilize the space they already have.
One thing is clear; having the technology to shift business to the cloud while keeping employees connected is more than just a logistical advantage. It’s also become a significant chance for cost-saving. Business leaders adapting to the changing world should view this as an opportunity to save money and resources usually spent on real estate and basic office costs.
Read about ways to help employees adjust to long-term remote work.