Recent research by The Instant Group about the state of the UK flex market shows that demand for flexible working is growing at an astounding rate. As businesses leave pandemic-era policies behind, market data shows that demand for flexible workspaces has grown by 22% in 2022.
Growth across the country shows that coworking has staying power in the UK. Hiring managers are using coworking to promote themselves as a “flexible” employer to attract top talent and gain an edge against less agile competitors. This helps companies navigate the continued uncertainty of the last few years with higher employee retention and stronger work culture.
The Instant Group’s research shows that demand for flexible working spaces has increased in most UK cities in 2022. In Liverpool, Manchester, and Leeds, demand has grown by 15-25%. There are a few outliers, as Bristol and Birmingham have seen a drop in demand this year, but wide-scale demand will “inevitably result in significant supply expansion and diversification.”
Increased demand for flex working spaces is likely being driven, in part, by progressive employers who want to keep their overheads low while promoting employee wellbeing. Tech firms are particularly keen to utilize flex spaces, as coworking offers employees a creative, productive atmosphere that promotes critical thinking and greater mental well-being.
Demand has also been driven by greater access to collaborative software programs that make it easier for employees to work outside of the office. More companies can approach remote collaboration intentionally and work to replicate the office environment in digital spaces.
By utilizing collaborative tools, managers can create digital teams, work synchronously on files, and engage with employees from other departments. This makes coworking the most agile approach to business operations in 2022 and beyond.
A focus on agility
Corporate agility has always been an important aspect of business success. However, the past few years have shaken up most markets and increased the need for even more agile business operations.
Recent research about organizational agility from McKinsey shows that firms who successfully adopt agile business models benefit from a 30% gain in customer satisfaction, employee engagement, and operational performance. These same firms also benefited from improved efficiency in the workplace, which sparked greater opportunities for innovation.
Flexible workspaces can facilitate greater agility for UK-based businesses. In 2022, companies are showing a preference for centrally located, high-quality coworking spaces as these offer the facilities that businesses need to remain competitive. In response, flexible working spaces are being updated to accommodate the increased demand for amenity-rich coworking spaces that fulfill business needs.
The rise in demand for flexible office spaces is a good sign for the long-term strength of the coworking industry. However, not all coworking spaces are seeing the same level of growth. Businesses across the UK are showing a preference for amenity-rich spaces that are aesthetically pleasing, desirably located, and provide a service that goes beyond the traditional offering.
According to The Instant Group’s UK Flex Market report, amenity-rich spaces hold an average occupancy rate of 82% — a significantly higher rate than “traditional” spaces which hold a 74% occupancy rate. In response, 55% of industry activity has played out in Grade A listed buildings.
The amenities that business occupants require from coworking spaces differ from company to company. Coworking providers looking to add amenities to their space should consider meeting rooms and conference rooms that support virtual webinars and networking events. These rooms should provide secure network infrastructure to avoid cybercrime and corporate espionage.
Companies can offer five-star, concierge-like service to demanding customers by building on the basics like coffee and snacks — even a well-designed coworking kitchen can help elevate these tried and true amenities. Complimentary access to a nearby gym, wellness events, and high fresh-air standards support productivity and can be a real boon for businesses looking to maximize the potential of flexible working,
Growth in the UK flex market has been promising across most of the nation’s cities. London is starting to reawaken as a flexible working hotspot, as employees are returning to the city for full-time or hybrid work. Areas like Southwark and the financial district have seen 12-23% growth in demand, which makes up for dips in demand in areas like Barnet.
However, most of the growth in collaborative workspaces is happening outside of the nation’s capital. Many businesses now work with virtual teams to improve productivity and increase employee motivation. Virtual teams have other benefits including keeping costs low and expanding the market potential. Simply put, they allow businesses to save on overheads while offering greater flexibility around how employees complete their work day.
Regional growth is particularly strong in northern cities like Leeds and Manchester where businesses will find an average desk price between 116 and 184 pounds per month ($139.23-$220.86 per month).
Low costs and the allure of living in Yorkshire Dales mean that employees and businesses can get the best of both worlds, as rural life and access to high-tech coworking spaces give hubs in the north a competitive advantage over urban competitors.
Market research into flexible markets paints a rosy picture for coworking in the UK. Even as pandemic-era regulations recede, the demand for amenity-rich coworking spaces continues to grow. This is great news for businesses and employees alike, as coworking reduces costs, minimizes commuting, and gives employees access to all the support and technology they need.