By Daniel Hunter
With pockets of growth and signs of increased business confidence, the BCA reports on a changing business climate that could spell growth for the flexible workspace sector, and the wider UK economy.
Despite the threat of an impending triple-dip recession, the UK's economic mood appears to be lightening.
On a nation-wide scale, the country's services sector is helping to bolster economic growth which is in turn dampening fears of a return to recession. A key indicator of output, the Markit/CIPS survey shows that the services industry grew more quickly than expected in February, beating forecasts and recording the best results since September 2012.
The services sector is the biggest element of GDP, and due in part to its performance, many forecasters now believe that the economy is set to grow marginally over the first quarter of 2013, which would technically keep the UK out of recession.
According to various confidence surveys, these results appear to be generating a boost in business optimism. As part of its monthly Business Trends report, accountancy firm BDO recorded a slight uptick in optimism, while the FSB recorded an increase in confidence among SMEs from its 'Voice of Small Business' Index.
Such sentiments were also echoed by flexible workspace operators during the latest BCA Board meeting, held on Thursday 7th March. While it is apparent that there is still an overall feeling of caution, BCA Executive Director Jennifer Brooke noted signs of "increased confidence" among business centres and their clients, and a general wave of positivity rippling across the SME sector.
The flexible workspace industry, part of the services industry, is also showing signs of promise. Outside of London, there is a general sentiment that the UK's workspace industry is "rumbling along" with seeds of growth beginning to sprout in various parts of the UK.
As a case in point, global workspace supplier Regus recorded a 72% rise in full-year profit during 2012, and saw its share price rise as demand increased for its range of work environments. While some of its growth and future expansion plans are focused on the U.S. and Asia, the company has placed renewed interest in the UK - and is helping to highlight the value of flexible workspace given its planned takeover of MWB Business Exchange.
The acquisition process, during which Regus added an extra £25.6 million to its original £40m bid to thwart a counter-bid by Pyrrho Investments, has placed Regus close to securing MWB Business Exchange, its nearest UK rival. If successful, the company plans to add all 61 UK-based MWB business centres to its portfolio as part of a wider target to launch another 350 worldwide business centres in 2013.
By 2014, the company hopes to control 2,000 flexible workspace locations globally. Investec Securities analyst Andrew Gibb commented that the company is "on the front-foot for growth" and projecting a "sense of confidence". While Regus is a specialist case study given its global spread, its confidence is expected to create a ripple effect to other workspace operators and industry suppliers across the UK.
Regus is one of several flexible workspace providers that are investing heavily in changing workspace trends. Businesses of all sizes are adapting to a more mobile workplace, and are beginning to adopt alternative working methods such as drop-in business lounges, shared office space and coworking locations.
With this in mind, Microsoft expert Daniel Langton recently claimed that "anywhere working" methods could save the UK economy a phenomenal £45.3bn in lost productivity every year, and due to the positive effects on employee motivation and loyalty, said it could also reduce absenteeism by a further £3.2bn a year.
"Today, it's another tool in a company's armoury to be as flexible and cost effective as possible," he added.
The flexible workspace sector is perfectly placed to meet this demand for alternative workplaces, and with their potentially diverse blend of space - from touchdown and hot-desking space to part-time, serviced and managed offices - business centres have an arsenal of workplace possibilities to offer today's increasingly mobile workforce.
Tapping into this trend is NearDesk, which provides an innovative take on flexible working that not only meets business demand for a "third workplace", but also simultaneously equips business centres with the tools to take advantage of this sweeping trend.
The newly-launched NearDesk is described as the "Oyster Card for desks". It's a system that allows business users to swipe in and out of workplaces on a pay as-you-go basis and, as the portfolio grows, the company aims to create a network of workplaces that anyone can reach within minutes.
With over 2,000 business centres UK-wide, these locations are fundamental to this objective - and the business centre sector is now recognising the inevitability of the move towards greater flexibility and mobility in the workplace. This is encouraging innovators to address changes - NearDesk among them - and is driving widespread movement in the sector, with business centre and workspace operators announcing new flexible space modifications on an almost monthly basis.
The signs are positive. Improvement in services sector output, a rise in business confidence, growth in flexible working and a steadily expanding workspace industry might not be an instant cure for the UK economy, but it's a step in the right direction and a sign of greater investment potential for the UK's flexible workspace sector.
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