What’s Behind the Explosive Growth of Coworking in the U.S.?

Coworking is booming. If you’re not familiar with the concept, a coworking space is an office setting where individuals come to do work while taking advantage of shared facilities, services, and tools. In addition to a business infrastructure, these spaces offer workers the chance for social interaction, work collaboration and networking.

Coworking is becoming so popular that it’s creating a workplace revolution. In 2017, there were 542,000 people working in coworking spaces in the U.S. This is expected to double to about 1.08 million coworkers in 2022. The market size alone is forecast to grow from $8 billion in 2022 to $24 billion in 2030!

Why has coworking become so popular? Here are six main trends behind this explosive growth:

1. The pandemic accelerated what is now becoming permanent growth

The pandemic led to remote working among workers without the infrastructure to readily do their work. They entered coworking sites with masks and easily set up offices. Many of these workers found added benefits: coworking spaces allowed for social contact and work collaboration. Now, as the pandemic fades, work models are permanently shifting to continue to favor coworking. Not all workers will return to the office and not all who return to the office will do so full-time. These scenarios will continue and may even grow because workers prefer it, and companies find it cheaper. Demand for coworking spaces will continue to grow at an astonishing rate. Coworking space as a percent of total office space doubled to 2.1% from 2017 to 2020 and is expected to grow to 30% of commercial office space by 2030.

2. The appeal is broadening

Coworking space evolved in the 1990s from internet cafés and gaming rooms. Now, in the 2020s, coworking is a mainstream option for workers and businesses. While 65% of coworkers are age 40 and younger, the demographic is broadening as coworking becomes more common.

3. Solo workers like the social aspects of coworking

Especially during the pandemic, as remote workers grew tired of the social isolation of working from home, many workers spent parts of their week at coworking sites. According to Deskmag’s coworking survey, people continue to choose a coworking space based on it having an enjoyable atmosphere (59%), to interact with others (56%), and to build a sense of community around themselves (55%).

4. Coworkers are broadening beyond freelancers

Freelancers, who often don’t have access to a suite of office services in their home, use coworking space and represent 41% of co-workers. But the next largest segment of users (and a close second) are corporate workers, who represent 36% of coworkers. The draws for corporate workers are both the social setting and the conference rooms for in-person collaboration.

5. Corporations prefer coworking instead of satellite offices

A solid 86% of US companies have said their long-term real estate strategy includes flexible and coworking spaces. Coworking space is a cheaper alternative than setting up a small corporate office in a city. Enterprise companies, like Microsoft and Pinterest, find it more economical to set up remote offices in a coworking space than lease a permanent office.

6. Coworking is socially and economically profitable

Coworkers get many more benefits than a remote office space. Research shows that 79% of coworking users have expanded their social networks as a result of joining a flexible workspace. But the benefit is not just social. 51% of coworking space members feel that joining has helped them in finding new job opportunities. 

These growth drivers are not limited to the U.S. Global growth of coworking, a $16 billion market in 2022, is expected to increase at a compounded annual growth rate of 19%.