Here’s what three global coworking experts have to say about the coronavirus pandemic.
We’re all navigating an unprecedented global event. In an effort to help the coworking community, Liz Elam of GCUC, has connected with Jean-Yves Huwart of Coworking Europe and Jamie Russo of GWA to discuss the implications and offer insight surrounding the coronavirus pandemic.
How do you think the coworking industry will be affected by the coronavirus short term? Long term?
Jamie Russo: We think that in areas that are hardest-hit by the virus, consumers will start to evaluate a new criteria for coworking spaces – cleanliness. Coworking spaces may be forced by consumer demand (especially at the enterprise level) to up-level their cleaning procedures and frequency. Operators will likely need to find ways to signal these procedures to potential members. These signals may need to be incorporated into the search process, tour process and on-boarding process. We don’t think that the long-term answer is encouraging people to spend more time isolated at home, but to find a way to mitigate the risks and get back to a more normal state of the world. In the short-term, the states in the U.S. that are hardest hit are reporting lower tour volume and lower daily attendance. However, some have reported increased meeting room rental as those with corporate offices that are off-limits are looking for alternative meeting places. Not everything can be done over Zoom.
Jean-Yves Huwart: The coworking industry is as severely impacted as any other. In Europe, we already are hearing stories about events and even meeting room booking cancellations. Employees of small or big organizations were the first to be recommended to home work as employers do not want to take risks. This is the same reason why corporate travel was the first to be canceled. The only coworking product not hit, it seems for now, is the virtual office, of course. Revenues will go down, no doubt about that, in the coming weeks. The key question now is: how long will the pandemic last and how hard is it going to hurt the economy? Some expect five weeks of confinement, then some months of slow recovery. Others bet on a ‘V’ shape kind of crisis, with a rapid economic reboot. The truth is that nobody knows. Everyone is looking at what is happening in Italy. On a longer term, the main reason for hope for coworking is that lots of companies will have ultimately been forced to apply home working on a big scale. They might learn from the experience that people have no need to commute long hours in order to sit all day long next to one another in an HQ to be productive; nor that there is a need to keep them under a permanent watch to make sure they don’t procrastinate. Home working is often a step preceding the adoption of coworking, the best model for today’s distributed workforce.
Liz Elam: Things are so uncertain at the moment and changing every day. I do think we’ll see more people being sent home to work or quarantined. Short term this will hurt coworking until we better understand how coronavirus is spread. Long term it might actually be good. Companies and individuals will learn they can work from home. The risk is that people will be sent home to work and the loneliness epidemic will become worse than it already is. People need options and access to a collaborative environment is needed for success in life and work. In addition, companies will have to rethink their distributed work models and I believe this will also increase coworking space usage.
How can we help make workers feel safe in a coworking environment?
Liz Elam: This is a great question and the answer is complicated. We are missing lots of information around the spread of the disease. In the short term, placing cleaning supplies and hand sanitizer all over the place are a great way to start. This empowers the individual to address their work area. I’ve heard that many operators are increasing the frequency of cleaning in their space. Encourage those that have traveled internationally or are showing any symptoms to stay home. Be sure to let the community know how you are addressing it. Choose your words carefully.
Jamie Russo: As I said above, I think that shared workspace operators will start to become much more focused on cleaning procedures and communicating/signaling to members their efforts to maintain a clean environment. These efforts may come at an extra personnel cost for larger spaces. The reports we hear from operators are that they are supplying tools to help members keep their work areas clean (sanitizer where available and disinfectant wipes), but that members are not necessarily playing along. Staff (generally the Community Manager) is having to pick up the extra cleaning burden. We may also see some reduction in the densification of workspaces. For the operator, revenue per square foot is often a metric considered in the
design phase because it drives the financial sustainability of the space. But there may be some consumer backlash about the dense layouts of open spaces and even team offices.
Jean-Yves Huwart: Indeed. In our space, we have disinfection products in every room, so members can sanitize the tables or the door handle. We tripled the stock of hand soaps. No more kisses, hugs or handshakes. It’s a shoe shake or Namaste, instead. It’s fun and not too dramatic. Those are the basic recommendations governments are promoting in the media. It does a lot, already, to prevent further contamination. Isolation is hard to go through, especially for the people who are not sick. So we could see people getting back in the coworking spaces next door after one or two weeks. China’s Starbucks are now re-opening, after all.
If coronavirus throws us into a recession how will that affect coworking?
Jamie Russo: The independent workers that are stretching to budget for a coworking membership may retreat to their kitchen counters, but the insights that we see from our members and our board members indicate that the flexible office movement for corporate occupiers is going strong and that a recession might catapult the momentum rather than slow it down.
Jean-Yves Huwart: Some say coworking was born from the 2008 crisis. I would rather believe that coworking is the child of the price drop of the laptop cost as well as of the rise of wireless connection. Anyway, as I said previously, it could fast-forward the remote work adoption process of many companies around the world. It’s hard to trust a model you are not aware of. Should a recession hit, cost reductions could come from embracing a distributed workplace model, where employees can work closer from their home, while not being isolated nor out of touch from colleagues living in the same area. It’s the opportunity to strengthen the message, especially through working on some PR actions that can spread the story in the mainstream media and that way change the mindsets.
Liz Elam: Coworking grew out of the great recession. Sending everyone home to work sounds like a great idea at first, but then people are isolated and alone. This is like adding lighter fuel to fire that is the loneliness epidemic. People want flexibility and choice in how and where and when they work. I believe that companies will figure out post coronavirus that they can in fact work from home and after the glow of something new wears off they will seek out communities and coworking. I also think people will stay home for a month, maybe two. Smart operators have multiple revenue streams and have savings to protect them in a downturn. I experienced unemployed folks joining my coworking space in a downturn for community, connections and to ward off depression.
How will the coronavirus affect your conferences?
Jean-Yves Huwart: We don’t know yet. Our German friends have their national coworking conference in six weeks and stress that strict hygiene and air ventilation measures have been taken. We are nine months away from the Coworking Europe conference in Vienna. It’s an opportunity to show how the coworking models can also offer new solutions and make our economy more resilient in such circumstances. So, we could end up having more people and more coworking operators who find new opportunities are arising.
Liz Elam: We had to reschedule GCUC USA to July 2020, it was previously planned for April 20th in Seattle. The decision was an effort to protect the health and wellness of our community and the world at large. Seattle’s King County had declared a state of emergency and our community did not want to travel to Seattle in particular. We spoke with our community and everyone agreed that this was the right decision. We are staying in Seattle at the same venue, just picking it up and dropping it in July. We are monitoring Manchester and as of yet don’t feel the need to pivot there. We have been amazed and humbled at how understanding and supportive our community has been during this tough time. Once again the unique, special movement that is coworking shines bright during this dark moment in history.
Jamie Russo: We are still six months away from the GWA conference. We are optimistic that we’ll be back into a more normal state of business at that point. We are developing a contingency plan that will support us through this event as well as future events. We will also likely integrate risk management as a topic into our conference agenda. Unpredicted downswings in demand can have a significant impact on small business owners including coworking space owners.
Thank you to Jean-Yves, Jamie and Liz for showing us how true leaders function. They band together to support their community and share their knowledge. Liz also wanted us to mention that both Jamie and Jean- Yves have offered support and advice knowing that the GCUC team had to make some hard decisions. After all in the end it’s about the people we meet along the way that lift us up… Coworking continues to evolve and choose to do business in a more kind, human and supportive way. No wonder it continues to defy the odds.