The Next Trend: The Home Office Sharing Economy
Covid-19 launched one of the largest, unintended corporate pilot programs of the past century: the ‘Work-from-Home’ experiment. “Work-from-home” has long been synonymous with slacking off. Older, corporate insiders scoffed at the mention of it. Work-from-Home has been saddled with the belief that employees cannot be nearly as productive when out of the office, as compared to when they come to the office. But with the advancement of technology and telecommunications, remote working no longer bears the scarlet letter of perceived laxity. Even before the pandemic, a research study found that working remotely yielded greater productivity and lowered costs. Now, we are discovering that a large percentage of knowledge workers quickly adapted and working from home has had an overall positive effect. With the mounting support for the remote workplace, where does that leave the traditional corporate office?
The office will no longer be “The Office.” Sorry Michael Scott. If we are honest, the office environment was already undergoing a reformation. Albeit slow. Consulting firms were one of the earliest adopters, employing a ‘hoteling’ practice in which employees do not have a permanent office space and make hotel-like reservations to secure a spot for the day. This worked reasonably well for consultants who worked more transiently. But what about more traditional employees? Look no farther than pharmaceutical giant, Pfizer, which decided to massively downsize it’s corporate real estate footprint in New York City by moving across town to the burgeoning Hudson Yards. While the new headquarter is still large, (800,000 Sq. ft) it will accommodate significantly less employees. Which implies that many of its staff will find themselves working in a more flexible and remote arrangement.
Enter the work-from-home sharing economy. Uber did it with cars. AirBnb did it with houses and apartments. WeWork started the revolution in co-working spaces. And I am predicting that we will see a rise in the work-from-home sharing economy. The aforementioned players became Unicorns by monetizing underutilized resources. Our residences during the day, which remain largely unoccupied, represent a massive underutilized asset. Companies would effectively “rent” your home as an extension of their corporate office. This may sound extreme but in some respects we are half way there. According to one study, over 70% of employees are routinely checking email and doing work at home. With the “covid experiment”, loads of companies are already telling their employees to stay home for the foreseeable future (or forever in the case of Twitter). Many companies have predetermined which employees are critical to maintain onsite and which ones can more seamlessly work from home. And several companies are already leaning-in to this trend by offering incentives to employees to NOT return to the office. One workforce consultancy is advising corporate customers to offer an annual employee stipend to NOT work from the office and invest the stipend in home office upgrades.
But work-from-home is not without its frailties. Workers have not entirely adapted to working in a non-office setting. One research study suggested that nearly a quarter of employees were working from their bed and even more worked in ergonomically unsustainable locations, like their kitchen table or family sofa. And broadband and cellular networks remain inconsistent and unreliable as compared to the fiber-optic cabling found in a traditional office building. And perhaps most importantly, as human beings we are wired for socialization and human contact. Modern offices are designed with this notion in mind, our homes are not. There is no doubt that work-from-home has miles to go.
While the work-from-home trend is indeed in its infancy, rest assured it is here to stay. Employees will desire greater flexibility in how and where they work. Employers will be salivating at the possibility of greatly reducing fixed costs and expanding the reach of their employee radius. And with both parties interested in an innovative solution to reconcile their unmet needs, I predict that we will see the rise in the next great sharing economy, the home office sharing economy. Covid has shown us that the majority of knowledge workers can work from home. AirBnB and Uber has shown us that many people will readily share their most personal possessions with strangers. The next frontier is “renting” a share of our home to a corporation.
