The pandemic has challenged many assumptions about where, how and when people can work.  As businesses respond by cutting office space, what role might coworking spaces play in this new future?

We are a group of researchers who came together pre-COVID-19 to study the rise of urban coworking spaces, and tracked the development of these spaces through the period of the pandemic.

While the popular story of coworking has tended to centre on hipsters, sofas, beer and ping pong, another side of the story concerns community-building and mutual support. As the UK moves to more flexible models of work, our research suggests that policymakers now need to give serious attention to the role that coworking spaces could play in revitalising urban economies and communities.

Video: covid and coworking spaces, produced by University of Bristol School of Management

What do coworking spaces involve?

Coworking spaces (CWS) are sites where people, who do not work in a centralised fixed office space or a fixed place of work, come together (in small teams or independently) to work and collaborate. This occurs in an ‘office-like’ environment, where desks of various levels of privacy are available on different bases – hired by the hour, week, month or long-term. At first glance, CWS resemble a place of work like any other, albeit sometimes occupying unusual or derelict building stock in parts of towns and cities undergoing urban renewal.

Many people already appreciate that these spaces are vital for independent workers or small teams to co-locate with one another, and benefit from networking and collaboration opportunities that arise from being in close working proximity to others. In line with this, there is a growing body of research examining what goes on day-to-day within CWS, with empirical studies mapping everyday interactions that make up working life in a coworking space.

However, there is a dearth of understanding about how CWS business models operate within the broader mechanics of local labour markets, urban geography and urban political economy. In particular, research into the dynamics around finance, rent and property development has been neglected, yet such dynamics have an important role in shaping both the establishment and organisation of spaces.

Coworking spaces and the Covid-19 pandemic: our research

COVID-19 gave us the impetus to investigate these dynamics during a particularly critical moment in the history of coworking spaces. Taking a multi-city approach, we examined CWS in Bristol, Brighton & Hove, and Greater Manchester. In each of the three cities, CWS had been growing in number prior to COVID, influenced by factors such as entrepreneurial ecosystems, predominance of the freelancer workforce, and relationship to London. We conducted over 40 interviews in these city CWS, with representatives from a range of types of CWS, and with local and regional government.

Our research generated multiple important findings about the nature and form of CWS.

A key finding was that the growth, pandemic reponse and future development of coworking spaces is shaped as much by financial and rent-driven dynamics in urban property as by their founding organisation or social purpose.

In this context, we found that CWS have grown and developed as a way for property owners to gain rents from urban property. However, such fortunes are by no means guaranteed, and the survival and growth of coworking spaces involve complex and continuous management around financial pressures and delivery of a rather eclectic range of services. This can involve hospitality alongside property management know-how. At the same time, coworking spaces have contributed – in some degree – to recovery from the pandemic, by providing places to work collaboratively or collectively in the context of a widespread growth in flexible and hybrid working practices.

The pandemic underscored the ambivalent position of CWS in hosting, but not employing, users. It revealed the variable positions of different CWS business models in the face of disrupted income streams. Our findings from the three cities highlighted the substantial range of CWS business models, including the variable combinations of revenue streams from ‘pure’ coworking vs. those offering hybrid forms of flexible office space management, innovation spaces, and partnerships (for example with universities or financial institutions). We found that some business models – such as those with a more social or community ethos – are more vulnerable than others and the future looks rather different for different types of CWS.

The future of coworking spaces

There is some expectation, in this context, that CWS are really going to come into their own as companies shake off  excess office capacity and certain segments of the workforce become less fixed in terms of work location.

While space operators are banking on their importance increasing, it remains to be seen whether the recovery from the pandemic will grant coworking spaces a new centrality in contemporary working life.

The demand for, and volume of, remote working precipitated by the pandemic has also prompted some strategic geographic recalibration, with attention shifting from the towering dominance of London, to smaller urban hubs and especially commuter towns. The proliferation of a wider range of CWS in an ever-increasing number of locations may also encourage inclusivity, with services offered at different price points and underpinned by collaboration with a range of actors, including local authorities, research institutions and community organisations. At the same time, the greater competition and marketisation of CWS risks compromising the original mission of coworking spaces – to provide community and mutual support to workers with non-standard working arrangements.

This can only be addressed by local and national policies that recognise and nurture the role wider social and economic benefits coworking spaces can provide.  Such policy and strategy should be aimed towards protecting the vital infrastructure it provides from the vagaries of the market. We detected only the earliest signs of a coordinated and specific approach to the coworking space sector among local and national government – although all recognised the potential importance of this.

The absence of a coherent strategy risks leaving coworking spaces and their users adrift in increasingly turbulent and competitive market conditions. This is especially important at a time where CWS stand to broaden and build their reach, potentiating a post-pandemic growth of significance.

We now urge policymakers to seize this moment to imagine how different models of coworking spaces could play a role in supporting new flexible and hybrid models of work in ways that enhance our urban centres and serve the communities that live and work there.

Co-working spaces and the urban ecosystem: the future of co-working post-Covid-19.  Read more.