IWG: A Trends Forecast for 2023

International Workplace Group (IWG), the world's largest provider of flexible workspace solutions with more than 3,300 locations in 1,100 cities worldwide, is at the forefront of a seismic shift in how people want to work. Recently, IWG published a white paper titled, “The future of work: A trends forecast for 2023” to outline some of the most popular shifts that are impacting the global workforce. 

“During the pandemic, our ability to free people from the dreaded commute became more important than ever,” said Mark Dixon, Founder and CEO of IWG. “As a result, ‘hybrid-working’ is now the preferred solution for millions, as they divide their working hours between their company headquarters, a local flexible workspace and their home – boosting corporate productivity, while also creating a more sustainable way of working for both people and the planet. Looking at trends for 2023, it’s clear that yet more change is on the way, as our working lives are impacted by innovations and new thinking in areas such as sustainability, technology, recruitment and productivity.”

Outcomes Over Hours

According to Stanford economics professor Nicholas Bloom, a world-leading thinker on the future of work, hybrid work increases productivity by around 3% or 4% on average. An IWG survey shows that 31% of workers believe productivity is enhanced by the hybrid model. 

“Following the COVID-19 pandemic, there has been a fundamental corporate mindset shift, as companies focus on outcomes and employees meeting their KPIs, rather than simply on the hours they work,” the white paper states. “This has led to a willingness to experiment with new ideas around work in general, and one example of this is the four-day week, which in the past was much talked about but rarely implemented. But now, that’s changing.”

Metaverse Continues to Expand

Another emerging trend, the white paper states, is the metaverse. At the annual Meta Connect presentation in October, 2022, CEO Mark Zuckerberg announced that the company would be partnering with Microsoft to bring workplace tools to VR, and premiered a new VR headset designed with business in mind. 

This will likely impact the future of hybrid work moving forward as organizations look for ways to leverage technology to increase connectivity and productivity. Accenture’s ‘Nth Floor’, for example, is “a virtual space that mixes ultra-realism with wild fantasy, and is used for a mix of purposes, including onboarding, training, meetings, events and just hanging out. It can be accessed via either a laptop or a VR headset (the company deployed 60,000 Meta Quest 2 headsets to employees), and is proving particularly effective in maintaining a corporate culture in Accenture’s hybrid, distributed workforce.”

Small Towns Boom, CIties Rethink

A recent IWG poll of Gen Z workers (who are set to make up more than a quarter of the global workforce by 2025) found that “85% want to be able to use an office close to home. In a separate IWG survey, 77% of workers said a place to work closer to home was a must-have for their next job move.”

“Companies are increasingly responding to employee demand for local working and adopting a ‘hub and spoke’ model – downsizing their main office and utilizing satellite offices or flexible workspaces closer to workers’ homes,” the white paper states. “The trend is mirrored by the growing popularity of the 15-Minute City, a sustainable planning concept in which work, home, shops, entertainment, education and healthcare are all within 15 minutes on foot or by bicycle from where we live. The growth of the neighborhood office is in turn causing a tectonic shift in urban geography and demography.”

Have Laptop, Will Travel

For many remote workers, the concept of “Work From Home” has now shifted to a “Work From Anywhere” mentality. According to one estimate, there are currently around “35 million so-called ‘digital nomads’ scattered around the world, traveling from place to place and working remotely. Nearly two-thirds of them are aged under 40, so it’s a trend that’s set to grow even further.”

But these digital nomads still want a temporary office space to post up every once and a while. That is why access to high-quality professional workspaces, business centers and co-working desks are becoming more popular than ever. “These are the kinds of facilities offered by IWG in its 3,500 (and rapidly growing) locations in 120 countries around the world,” the white paper states. “And they’re easily accessible thanks to IWG’s popular on-demand membership program, which gives access to all of the group’s global locations. Demand for the scheme has risen by 93% in the last year.”

Rise of the Green Lease

As sustainability becomes a larger priority for companies worldwide, hybrid working models are helping them to mitigate their real estate emissions.

“It’s been shown that buildings account for 40% of societal energy use and 33% of emissions, so real estate is a prime target when it comes to ways to reduce a company’s carbon footprint,” the white paper states. “More and more property owners are upgrading their facilities to offer best-in-class sustainability features and more businesses are seeking to sign ‘green leases’, which allow owners and occupiers to work together to make buildings more sustainable and less environmentally harmful. Provisions in the lease typically cover issues such as carbon emissions, compliance with energy efficiency regulations, waste reduction strategies, and green transport measures.”

Purpose, Purpose, Purpose

In IWG’s survey of Gen Z, nearly a third said they would quit their job if their employer’s values didn’t align with their own. “Environmental and social responsibility are of particular importance to Gen Z, with almost half refusing to join a business that doesn’t have clear environmental and social goals,” the white paper states. “Half say they would leave their job if their employer backtracked on social or environmental targets.”

ESG assets under management have also seen 30% growth over the last five years and are forecast by Bloomberg to make up a third of total global assets under management by 2025.

Companies and Workers Reap the Hybrid Benefits

Hybrid work is not only a benefit for employees, but also for employers. There are several ways in which hybrid work can boost a company’s bottom line.

The first is by reducing facility spend. A recent survey by workplace software provider Robin found that nearly two-thirds of U.S. executives are planning to reduce office space by as much as a half or more next year. It’s what Dixon has termed the “Great Lease Resignation,” as long leases are increasingly shunned in favor of more flexible arrangements.

Hybrid working has also been shown to increase productivity, staff retention and recruitment. In addition, there’s a significant financial benefit for hybrid workers as they avoid the costs of commuting, ordering lunch, etc. 

A.I. Powers Hybrid

The metaverse isn’t the only innovative tech impacting the future of work. Data analysis and AI are increasingly playing a role in solving the challenges thrown up by the new world of hybrid working.

“Companies are gathering insights from multiple sources such as employee productivity and environmental data, which includes heat, noise, humidity and power usage to shape the office of the future, while minimizing environmental impact,” says Dixon.

San Francisco-based VergeSense, for example, has developed a “spatial intelligence platform” that uses AI and intelligent sensors to help companies optimize the use of their space. By understanding which areas are being used and which are lying empty, workspaces and policies can be adjusted accordingly.

Retaining Talent

As the workplace changes, so do the needs of workers. In a recent IWG survey, 70% of UK office workers said that a good workplace benefits package had become more important to them in the last two years. And an IWG survey of 1,000 HR executives in the U.S. found that 88% believed they could reduce staff turnover if they offered more appealing benefits.

“Traditionally, private health care and gym membership have been reserved as perks of the privileged few working for large companies,” says Dixon. “Now customers across all our brands including Regus and Spaces will not only have access to these benefits, but their existing ones too, including member events, networking opportunities and access to the world’s largest co-working network.”

Training is also a major concern for employees today. In a recent Microsoft survey, 76% of employees said they would stay longer at their company if they could benefit more from learning and development, and more than half felt the best way for them to develop their skills was to change companies.

Side Hustles and the Pixelated Workforce

Just as traveling to the same office day-to-day is becoming outdated, so too is the idea of having just one job. 42% of Gen Zers and 39% of Millennials have a side hustle. The trend was originally given a boost during the pandemic, when people had time on their hands, but now it’s becoming normalized. Popular ways to make extra cash include making handmade goods, cleaning services, tutoring and hospitality work.

Author and influencer Josh Bersin has coined the term “pixelated workforce” to describe this new way of working. “Every individual in every different type of work is a mini ‘workforce,’ each with its own way of doing business,” he says.

Making Collaborations Count

In-person meetings are still part of the hybrid equation, but they will need to be handled effectively and mindfully in order to be successful. Especially now that most meetings feature at least one remote participant, organizations need to adapt.

“The most successful companies are now very focused on how meetings work,” says

Dixon. “It’s not enough anymore just to schedule a meeting and then try to wing it. A meeting needs to be properly curated in advance. That means a clear agenda, and everyone attending should fully understand what their role is and what kind of outcome is required. If people are going to make the effort to come together in the office, it’s essential their time there is spent productively.”

Google, for example, has designed a circular hybrid meeting room made up of separate modules that can be used either as seats or to house screens showing life-size images of remote participants.

“All of the trends we have highlighted for 2023 will hasten the journey to this new normal,” the white paper states. “As we have seen, business leaders are increasingly focusing on how to enrich the experience of their employees, using new technology to increase efficiency, while also finding new ways to boost health and wellbeing. Thanks to hybrid, productivity and profits increase, while people and the planet also benefit.”

Read the full white paper, here.

Learn more at https://www.iwgplc.com/en-gb/develop-a-location.