Co Working – Pivot of the New Economy – Stowe boyd

Stowe is one of the most thoughtful commentators on what is going on – here is his conclusion on a post about what will make the new network economy viable:

What’s Missing? The Second Place.

But there is a factor that is a potential hiccup. Many folks that adopt a telework or freelance work model and opt to work from home quickly come to miss the social aspect of their old work place.

In the US and Western countries, there has been a growing adoption of co working spaces, where freelancers, employees of small businesses, or teleworkers can get the best of both worlds: they can work from a work space close to their home — thereby avoiding a long distance commute — but at the same time they can have the support and stimulation that comes from social interaction with well-known people other than your family.

Ray Oldenburg, the urban sociologist, is best known for his notion of the Third Place, like the corner bar, the cafe, or the barber shop, where we can interact with people that we don’t know well, and perhaps with whom we have little in common. He argued that such places are critically import to the health of cities and out societies. He took almost as a given that people would continue their relationship with First and Second Places, the home and the workplace, respectively. But the trends of telework and freelancing means that an increasing means the more people are spending less time in official Second Places, and more at home and Starbucks. But as wonderful as working in a café is, there is definitely a great deal missing.

So it’s no real surprise that the co working movement is growing at a pace that seems closely linked to the number of people jumping into telework or out of the traditional workplace. Deskmag states there are now more than 1,100 co working spaces worldwide, more than double the number in 2006. Loosecubes, a service set up to help people find co working spaces, is tracking over 1,400 locations in over 500 cities, globally.

According to Carsten Foetrsch of deskmag, 72 percent of all co working spaces become profitable after 2 years of operation, and for privately-run spaces, the number is even higher: 87 percent . So the economics for those interested in setting up and running co working spaces is compelling.

A Virtuous Cycle?

Looking from a economics viewpoint, all the players have economic motivations to support co working:

  • The office worker saves significant expense and time by decreasing commute time, and those with the longest commutes should have the strongest motivation to shift to telework. Therefore, there is a steady migration to telework as businesses adopt policies to support it.
  • Businesses have a strong incentive to increase employee morale and productivity, and to decrease expenses related to the increasingly large percentage of their office space that is underutilized. Even if businesses have to subsidize co working space use by teleworkers, the net savings are significant.
  • As the number of freelancers and teleworkers increase, the demand for co working space grows, since people need the strong social connections historically offered in the workplace, not just the chance connections afforded by sharing a table in Starbucks.
  • Entrepreneurs have strong incentives to create co working spaces: partly to serve as their own base of operations, but also as a business proposition of its own. Note that the desire of businesses to shed unneeded office space in our down economy also provides lower cost space in which to set up shop.

When you look at it as a system, co working is a complex societal dance, where the various players are each seeking to  maximize their personal economic situation, and it leads to a new social reintegration. And the result of this migration of workers from the office to the co working space is a net benefit for the world, too: the decrease in energy use for the unused office space and the decrease in commuting translates into decreased carbon footprints for all involved.

Co working may turn out to be the pivot in today’s post-industrial transformation of work: a shining example, perhaps, of how large-scale positive change at the societal level can emerge peacefully from the independent pursuit of personal ends.

Stowe Boyd writes and speaks about social tools and their impact on media, business and society. A GigaOM Pro analystBoyd also writes at stoweboyd.com and is working on a new book about the rise of a socially augmented world, called Liquid City: A Liquid, Not A Solid; A City, Not A Machine. Stowe will be speaking about co-working at Net:Work. 

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