The New American Office: CoWorking Spaces

Women CoWorking

The New American Office: CoWorking Spaces

By Nicklous Salzman, Founder 143 CoWork, LLC

Copyright © 2019 Nicklous Salzman. All Rights Reserved.

            The traditional American office and working arrangement is dead.  There will no longer be water cooler talks, timecards, cakes in the conference room, or disappearing early on Friday afternoon to get a head start on the weekend.  As appealing as all of those clichés of office life were, they are becoming extinct in the US.  The new American office consisting of non-traditional workplace arrangements has exploded in growth thanks to technological advancements and shows no sign of slowing.  “In the US, for example the share of workers doing some or all of their work at home grew from 19.6 per cent in 2003 to 24.1 per cent in 2015…” (Felstead and Henseke 196).  At this rate, by 2030, there could be as many as one out of every three Americans working in this new American office.  To understand this major shift in the way Americans work, one must first explore the origins of this movement and predict what may be the office environment of the future.  If we don’t grasp the parameters of the future that we will be employed in, there is no possible way we will be properly prepared to thrive in that environment.

The History of the American Office

The traditional American office was conceived from the federal labor laws of the Fair Labor Standards Act of 1938.  Prior to these laws, there were no limits to the hours an employer could require, nor a minimum age of employment. These sweeping changes for workers to a standardized work week of 44 hours (later changed by congress to 40 hours), a minimum wage of $0.25/hour, and banning the hiring of children under the age of 16, set the stage for a manufacturing-based economy that was paid hourly, and expected to perform during the daylight hours of 9AM to 5PM.  The economy at this point was based in manufacturing and agriculture to a smaller degree.  Manufacturing for a goods-based economy was started during the Industrial Revolution of the 19th century and perfected by the necessity in two World Wars.  Following World War II, the US experienced a population deurbanization and the creation of suburban cities.  These workers commuted to their office jobs inside nearby cities thanks to reliable transportation and leveraged technologies such as telephones, creating access to the work like never before.  The workers participating in this economy were proficient in teamwork, collaboration, and manufacturing due to skills earned in World War II.  Thus, their work environment was no different.  Everyone converged at a common office (battlefield), with a handful of analytical minds managing (officers), while the masses produced the products that drove the economy under their direction (enlisted personnel).  In the decades following, the US economy transitioned from a manufacturing-based economy, one that produces goods to a service-based economy.  Technology-based productivity gains from innovations such as refrigeration, advances in agriculture, mass transportation and distribution networks, and automation made the manufacturing economy of the past more efficient, which in turn required less workers in that sector.  Job lost from technological productivity gains in agriculture, retail and manufacturing, has created demand for businesses and skilled labor in IT to support this growth.  With the new dominant product of the economy being based in thought, intellect, and analytics, the workforce shifted to meet the demand.  There was less of a need to have a traditional office to participate in this economy, and with new technologies, the workplace started to decentralize.

Origins of CoWorking

The shift to the non-traditional office began in the 1970’s when Jack Nilles created a communication system for NASA and the US Air Force.  This system was similar to the internet we use today in basic functionality, where he could securely access and submit work remotely, coining the term “teleworking”.  This began as a way to maximize productivity and leverage existing technologies to work efficiently.  Quickly, they found there were many benefits from this new type of work arrangement.  Working remotely minimizes traffic congestion, lessens pollution in the environment, gave workers flexibility, and better work-life balance.  Corporations started to realize the benefits created from this arrangement of corporate social responsibility, the optics of good corporate citizenship, and large savings in real estate, office space and rental costs.  Later, these corporations realized that workers would sacrifice pay in order to have a non-traditional working environment.  The allure of a better work-life balance was so great, that Mas and Pallais found “On average, job applicants are willing to take 8 percent lower wages for the option of working from home.” (3726).

Technology Leveraged for CoWorking

The greatest catalyst in growing this new American office has been technological advancements.  McKnight et al. wrote, “Technological innovations have been the dominant driver in industrial and cultural shifts throughout history.” (84).  Technological innovation has allowed these non-traditional arrangements to flourish.  Of these innovations, the rise of internet speeds and availability led to the 5 key business technologies that made teleworking efficient.  With the advent of Cloud Computing and Virtualization, Virtual Private Networks (VPN), electronic management of documents, modern phone systems, and web or video conferencing, everything that could be needed from a worker could be delivered remotely.  Just as with the delivery of electrical service in new suburban areas, followed by telephone service, the internet and accessibility to adequate bandwidth will be necessary technology to this workplace of the future.  McKnight et al. further stated that “With the rise of the internet and the increase of globalization, the geographic location of the consumer no longer plays as significant a role in the business as it did less than a century ago” (89).  Leveraging these key business technologies via reliable internet, a worker no longer needs to exist in the same area as the consumer to deliver their services.

Data in Support of CoWorking

Non-traditional office environments are already prevalent and growing.  “Of American businesses employing 50 or more people, 79% offer flexible schedules, 50% have telecommuting options, 38% allow compressed workweeks, 29% allow job sharing, and 27% hold part-time work policies.” (McKnight, et al. 92).  Chiru found, “45% of the US workforce holds a job that is compatible with teleworking (partial or total)” (225).  So nearly one in every two workers has a job that can work wholly or partially, without ever going into a traditional office.  Environmentally, participating in this new American office could yield substantial results.  “If all who have jobs compatible with teleworking system would work at home 2.4 days per week, then you could save 900 billion dollars annually and would reduce oil imports from the Persian Gulf by 45%” (Chiru 225).  As businesses use technology to compete globally, they are discovering a need for a human capital presence in all time zones.  Coupled with the numerous other benefits, it is not only an interesting proposition, but a necessary one for them to compete in the global economy.

The Future of CoWorking

The future of the new American office may be defined in part by the non-traditional workplace arrangement the individual worker participates in.  As many workers have shifted to non-traditional workplace arrangements, there has been a rise of shared workplaces to give these individuals a place to work other than their homes.  Coworking spaces originated in San Francisco around 2005, due to exorbitant real estate costs, it was uncommon to have idle space in a home for an office, and unaffordable to rent an office space individually.  Gandini defined coworking spaces as “…shared workplaces utilised by different sorts of knowledge professionals, mostly freelancers, working in various degrees of specialisation in the vast domain of the knowledge industry.  Practically conceived as office-renting facilities…” (Gandini 194).  In the aftermath of the financial and economic crisis of 2007 and 2008, these collaboratively oriented workplaces thrived.  As technology and infrastructure expands to more remote and rural areas, these non-traditional offices and workers could exist anywhere.  Perhaps even creating new centralized hubs of workers, in cities that never experienced the mass urbanization that some of the largest US cities saw in the late 19th and early 20th centuries.

Conclusion

The data shows clearly that a traditional office environment and work arrangements are not applicable to many US workers.  Roughly one in every four workers now may be working from their kitchen table, home office, coworking space, or truly anywhere that there is access to the technological capital.  The remote networking establishment was born out of social responsibility and access to new technologies.  The non-traditional workplace arrangements of the new American office are here presently and growing tremendously.  The new American office of the future is not a cubicle, it is anywhere that there is adequate access to the technologies needed to work.  

Works Cited

Gandini, Alessandro. “The Rise of Coworking Spaces: A Literature Review.” Ephemera: Theory & Politics in Organization, vol. 15, no. 1, Feb. 2015, pp. 193–205. EBSCOhost, search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=101544741&site=ehost-live&scope=site.Katz, Lawrence F., and Alan B. Krueger. “The Rise and Nature of Alternative Work Arrangements in the United States, 1995–2015.” ILR Review, vol. 72, no. 2, Mar. 2019, pp. 382–416. EBSCOhost, doi:10.1177/0019793918820008.McKnight, Samuel Tanner, et al. “Effects of Technology Innovations on Business.” Journal of Business & Behavioral Sciences, vol. 31, no. 1, Spring 2019, pp. 84–101. EBSCOhost, search.ebscohost.com/login.aspx?direct=true&db=bth&AN=137227633&site=ehost-live&scope=site.Mas, Alexandre, and Amanda Pallais. “Valuing Alternative Work Arrangements.” American Economic Review, vol. 107, no. 12, Dec. 2017, pp. 3722–3759. EBSCOhost, doi:10.1257/aer.20161500.Felstead, Alan, and Golo Henseke. “Assessing the Growth of Remote Working and Its Consequences for Effort, Well-Being and Work-Life Balance.” New Technology, Work & Employment, vol. 32, no. 3, Nov. 2017, pp. 195–212. EBSCOhost, doi:10.1111/ntwe.12097.CHIRU, CLAUDIU. “Teleworking: Evolution and Trends in USA, EU and Romania.” Economics, Management & Financial Markets, vol. 12, no. 2, June 2017, pp. 222–229. EBSCOhost, search.ebscohost.com/login.aspx?direct=true&db=bth&AN=124031542&site=ehost-live&scope=site.