Research: How Coworking Spaces Impact Employee Well-Being

Research: How Coworking Spaces Impact Employee Well-Being

Debates over hybrid work policies continue to revolve around two primary work locations: the office or the home. The authors argue this is a limited viewpoint, especially when it comes to addressing the significant problem of employee loneliness. There is a third space to consider: coworking sites. In the authors’ research, knowledge workers rated such spaces as more interpersonally satisfying than working from the office or from home. One big reason is that coworking sites offer better opportunities for employees to relationally craft their jobs — that is, pick which other professionals they engage with during the workday, and how. Social autonomy is a basic need of employees, one that will continue to drive their employment decisions in the years to come. The authors offer five pieces of advice for how employers can leverage the unique assets of coworking sites in designing their hybrid work policies.

“I feel very lonely in my job. I feel fed up with working from my home and not having anyone to talk to but feel equally disconnected when I have to go to the office for in-person team meetings.” — Research interviewee, a project manager in the U.K.

Employees and employers face a challenge: how to optimize hybrid work policies to maximize benefits for both sides, including reducing the debilitating effects of employee loneliness. Lonely employees like the one above tend to suffer from poorer well-being and lower performance — both issues that impact a company’s bottom line.

Unfortunately, remote and hybrid work can exacerbate feelings of loneliness among employees. This does not, however, imply that employers should rush employees back to the office. Workplace loneliness was escalating pre-pandemic when most knowledge work was conducted in offices. In addition, a full return to the office would limit the flexibility and autonomy employees desire, including in how they fulfill their social needs during the workday.

A better option for employee social health is to think beyond just the office or home locations. There are “third spaces” from which employees can also work, including cafes, hotel lobbies, friends’ homes, and coworking sites. Our research indicates that, among these options, coworking sites show special promise for solving employee loneliness.

We surveyed 819 employees working in office roles across the geographic and industry spectrum. Results showed, to our surprise, that respondents experienced working from a third space like a coworking site as more socially fulfilling than working from the office (64%) or from home (67%). One major reason is that a coworking space offers not just the flexibility employees crave in terms of where they work, but also with whom.

The Value of Coworking Sites for Relational Job Crafting

Our survey and subsequent interviews illuminated the ways coworking sites enabled employees to relationally craft their jobs — that is, customize the people with whom they engaged during the workday. This and other forms of job crafting have been associated with positive outcomesincluding greater employee satisfaction, performance, and retention.

In our study, we extend the concept of relational job crafting to show how it can be done not just with office colleagues but with other professionals — from different companies — working in the same physical location. In fact, our research indicates that coworking may offer better opportunities for relational job crafting than the office or home environments. Specifically, well-designed coworking sites provide:

An escape from coworkers

“Avoiding unnecessary interactions with colleagues” was a benefit cited by 52% of survey participants. This may be especially helpful for members of underrepresented populations, who often experience microaggressions and subtle exclusion in the workplace.

A variety of available relationship partners

By nature, coworking sites gather professionals from a wide variety of occupations and companies. As a senior analyst in the U.S. noted, “There’s value in the diversity of experiences there. You meet people that you’d otherwise be unable to at a standard office.” This diversity coupled with independence allows for more choice in partners.

A respite from the competitive and evaluative pressures of the office

Since the “colleagues” of a coworking site have no direct impact on an employee’s performance reputation or rating, it can feel safer to interact with them. As a consultant in the Netherlands wryly commented, “I don’t have to be concerned with every conversation demonstrating my performance and professional growth.”

A set of communally derived norms and enforcement mechanisms

The coworking enthusiasts we spoke to described feeling part of almost a social movement, a communal determination of the culture in which they worked. Most sites establish a coworking code of conduct and hire a community manager to ensure adherence to those ideals.

Pro-relational activity options

Community managers also arrange both formal (e.g., workshops) and informal (e.g., impromptu lunches) activities to facilitate relationship building and professional development. Employees in our survey praised these chances to regularly learn and socialize.

Due to these unique features, coworking spaces offer the opportunity for employees to make the kinds of rich personal connections that can be difficult to achieve in office or home environments. Relational job crafting helps explain why previous research found high levels of thriving among coworking site users.

What Employers Can Do to Optimize Coworking Site Use

We’re not advocating for employers to abandon their efforts to create a sense of welcome and belonging, whether virtually or in the office. Employers need to look beyond the home/office dichotomy, however, when it comes to enhancing work life for employees.

Here are five steps organizations can take to encourage and support their workforce in the use of coworking sites:

Educate employees about the potential benefits.

Although more than 3 million people worked from a coworking site in 2022, there are still many who have never tried it. Employees might have little understanding of why and how coworking could be good for them. In addition to communicating the relational job crafting opportunities described here, employers can encourage coworking by sharing information about potential gains in terms of productivity and work-life separation. There are other advantages as well, including greater data security (e.g., most coworking sites have private, password-protected WiFi) and more ergonomic work setups.

Provide stipends to cover usage costs.

According to 46% of our survey respondents, a company stipend to cover coworking fees would be a high-value incentive to use the spaces more. Companies may face increased pressure to contribute funding to remote worker benefits in the future. In the meantime, some employers, like Spotifyare already offering coworking stipends and seeing a strong uptake in usage as a result. Others, like Remote, are going one step further and promoting “group coworking days” to encourage four or more employees to gather at a site for concentrated collaboration time. Employees receive up to $30 per day to take advantage of such opportunities.

Mitigate the convenience trap of working from home.

Companies can help employees overcome the convenience trap of working from home by making switching to coworking sites easier. In our interviews, we heard that simple fixes like providing extra power cords and noise-canceling headsets to store at the site can go a long way toward reducing the hassle factor. Parking and commuting discounts can also help get people out of their apartments and houses more regularly.

Support participation in relational programming.

We heard from some community managers that the programming at coworking sites was underutilized. Employers can encourage employees to take advantage of these offerings by providing incentives, such as per diems and continuing education credits. Moreover, employers can glean useful insights about what types of relational programming work for their employees by collecting feedback on their experiences there. Coworking sites may even be willing to partner with companies to test new community-building ideas.

Provide training and guidance.

Many employees, especially junior career professionals, are struggling with how to build strong relationships in professional settings. Employers can provide training and tutorials to raise employees’ interpersonal skills, such as how to break the ice and turn an initial contact into a meaningful connection. Coworking sites can provide a safe playground in which they can practice these essential skills and expand their networks.

. . .

As employers explore the possibilities of coworking sites for their employees, they don’t have to go it alone. Our investigation unearthed enterprise platforms that automate the process of purchasing memberships as well as booking desk and meeting spaces. Coworking consultants are also emerging to facilitate the quest.

One key to a successful coworking plan, however, is to preserve employee flexibility. Just signing up for a contract with one major coworking provider, for example, will limit the sense of autonomy that is so crucial to relational job crafting. Furthermore, by funneling employees to the same narrow set of sites, employers may inadvertently recreate the same office dynamics that employees are seeking to avoid. For example, employees at a financial service firm in Australia became frustrated when their local coworking site became a satellite office with the same patterns of interaction.

Another pitfall is force-fitting a certain style of coworking site. For example, when a quirky local coworking site in Spain was bought by a real estate investment company, members felt it became devoid of the distinctive culture that had made it so appealing in the first place. To avoid these issues, we encourage managers to partner with employees in determining how to incorporate coworking into their hybrid work policies effectively.

Feeling connected to other people is essential for employee mental health and well-being. For a vibrant workforce, it’s in employers’ best interest to help employees overcome any feelings of loneliness. Coworking spaces offer the possibility of relational job crafting to meet the social needs of employees while operating in a professional, work-friendly environment. A coworking site is not your organization’s office, but it just might be a viable alternative.

Authors’ note: The authors gratefully acknowledge the contributions of Elliot James Perry, formerly of the #WorkAnywhere Campaign, who was instrumental in the design and execution of this research.

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