Research Reveals Canadian Business Owners are Prioritizing Cost-Cutting as Recession Fears Loom

• Nearly three-in-four (72%) Canadian business leaders (which includes owners, founders, and executives) are planning to cut costs amid rising inflation and recession concerns
• 80% of business owners and executives believe we’re either in a recession or one is on the horizon, with 31% looking to cut costs by 10% or more per annum as fears for the economy heighten 
• More than half (55%) of business owners and executives agree that a hybrid or remote workforce is more affordable to operate than a fully in-office workforce  

TORONTO (November 21, 2022): New data from IWG, the world’s largest flexible workspace operator, reveals that the majority (80%) of business leaders (which includes owners, founders, and executives) believe that Canada is either currently in a recession or is entering one. In preparation for this economic uncertainty, nearly three-in-four (72%) business leaders have started implementing, or are planning to implement, cost-cutting measures. 

The study found that 80 per cent of Canadian business leaders who plan to cut costs are targeting an annual cost reduction of 5 per cent or more, while 31 per cent are targeting a reduction of at least 10 per cent. 

While delaying (32%) or reducing (30%) new hires is one of the top ways business leaders are reducing costs, almost a quarter (23%) are currently or are planning to downsize or reduce office space/costs. Research shows that hybrid working can save organizations an average of $13,000 annually per employee (Source: Global Workplace Analytics), which explains why hybrid working is viewed as a critical way of achieving cost-cutting targets. Fifty-five per cent of business leaders agree that a hybrid workforce is more affordable to operate than a fully in-office workforce and 50 per cent said giving staff the option to work in a hybrid way would save their company money. 

“In economic uncertain times, companies should be assessing cost-cutting strategies – and hybrid working is one measure that can help businesses stay competitive and resilient,” said Wayne Berger, CEO, IWG Americas. “Adopting a hybrid work model achieves two powerful outcomes: meaningful cost savings for the company and a better work-life balance for employees. It’s rare to see a single strategy have such a positive impact across the board, but flexible workplace policies can improve the bottom line while simultaneously supporting the well-being of employees.”

With regard to the impact that hybrid work has on the finances and well-being of employees, Canadian business leaders expressed the following: 

• 70 per cent believe giving staff the option to work in a hybrid way will help them save money 
• 69 per cent believe giving staff the option to work in a hybrid way will help them work around personal commitments
• 62 per cent believe giving staff the option to work in a hybrid way will boost morale

IWG’s latest usage data shows that office usage across Canada rose by almost half (49%) since the start of the year, with firms such as Royal Bank of Canada and Apple asking employees to come back into the office for at least a couple of days a week. 

IWG has committed to doubling its Canadian network, with plans to open 250 new locations coast-to-coast in the next three years to cater to the increasing demand for hybrid working. The majority of the new locations are set to open in rural and suburban locations, reflecting the rise of interest for  flexible workspaces outside of city centres. 

About this Study

These are the findings of a study conducted by IWG from September 27-28, 2022 among n=210 Canadian executives and business owners/founders who are members of the online Angus Reid Forum. For comparison purposes only, a sample of this size would yield a margin of error of +/- 6.8 percentage points at a 95% confidence level. The survey was offered in both English and French.

About IWG PLC 

IWG is leading the workspace revolution. Our companies help millions of people and their businesses to work more productively. We do so by providing a choice of professional, inspiring and collaborative workspaces, communities and services.

Digitalization and new technologies are transforming the world of work. People want the personal productivity benefits of living and working how and where they want. Businesses want the financial and strategic benefits. Our customers are start-ups, small and medium-sized enterprises, and large multinationals. With unique business goals, people and aspirations. They want workspaces and communities to match their needs. They want choice.

Through our companies we provide that choice, and serve the whole world of work: Regus, Spaces, No18, Basepoint, Open Office and Signature. We create personal, financial, and strategic value for businesses of every size. From some of the most exciting companies and well-known organizations on the planet, to individuals and the next generation of industry leaders. All of them harness the power of flexible working to increase their productivity, efficiency, agility, and market proximity.

Join us at www.iwgplc.com