By Peter Chittenden, Managing Director | Residential, Colliers International.
Where and how people work is a key part of the impact of human capital in the local economy, and it is also another area where technology is having a major impact.
Shifting Work Patterns
Shifting work patterns are one part of our social demographics impacting the shape of the housing market. It is a change in our economy that is worth thinking about, and is very relevant given our highly urban concentrated workforce.
In the USA, some of the trends are more pronounced than what we see locally, however still aligned. According to published figures there are 53 million freelancers in America today. It’s been estimated that by 2020, 50% of the US workforce will be freelancers (this does not mean they are all full-time freelancers, but one of every two workers will be freelancers in some capacity). It is obvious that freelancers need somewhere to work from, and that’s a change that is already impacting the shape of the office market and also how people work from home.
This trend has been labeled ‘the on-demand workforce’ and is a highly flexible part of the US (and local) economy that is seeing more people, including independent professionals becoming freelancers working from home as well as dedicated shared work places, like We Work.
In the past you might pick one job, work hard for the next 40 years at that company, and then retire. This is not the way of the new economy which is now more diverse and opportunistic with a raft of job sharing sites making it very easy to find work.
Change is Happening Closer to Home
Locally, the ABS last estimated in 2014 that 1 in 3 people in work were engaged in some sort of freelance capacity worth $51 billion to the economy. People working in a freelance capacity did not do so exclusively, but did so for some time and as a part of their employment and income.
Aligned to this trend there has also been a constant change towards more part-time work and the move towards working from home has also continued to grow and that’s where I see an impact on the apartment market and building design trends responding.
Estimates of just how many people work from home are difficult to isolate but figures of around 1 in 12 are indicative of the trend, and by 2020 the Federal Government has a target of 12% of its employees doing so. The ABS has also published figures that show some 24% of the workforce do some hours at home, and that’s a big number. The trend has been on the rise going from 11/12% in the mid 1990’s and increasing since 2000. While those working from home tend to be older, and with more women who may be looking after children, the trend has been constant.
Technology has enabled the trend and this has made access to high-speed internet a must-have alongside reliable public transport; agility is clearly part of the mix when it comes to freelance work and working from home.
More of this type of work has also seen the provision of a work space, even in small apartments becoming an important item on the wish list for many buyers, even extending to a spare bedroom to be used as a home office. However, I also see room for another trend, and that’s the provision of shared work spaces as part of a development. In the same way as we have seen the spread of shared libraries, cinema rooms and lounge-rooms, shared work spaces make great sense.
We already have high-end serviced office space in CBD buildings, so decentralised space, closer to home is appealing. Our Millennials according to several surveys, may help accelerate this drift to freelance work, as many as 70% of this group already have or are interested in having their own business and they (35%) also value the possibility of working at home.
If you take a close look at most larger residential and mixed-use projects, I am sure there are pockets of space that could be used very productively and I think it’s a trend we will see soon, as the movement towards freelance work and working from home will drive this demand.