Will Coworking Spaces Be Affected by Service Labor Shortages?

• While the great resignation is affecting all industries, the retail and services industries are among the hardest hit. 
• Coworking space community managers are service workers. Will the great resignation impact the coworking industry?  
• To attract and retain service workers, companies need to offer attractive benefits, training opportunities, and more flexibility. 

The service and retail sectors took a massive toll during the peak of the pandemic. However, the negative ramifications of the pandemic have yet to cease harming these sectors.  

Throughout 2021, millions of workers have quit their jobs. The trend has become so widespread that it is not referred to as the “great resignation” or the “great reshuffle”. As a result, companies are now faced with a labor shortage, with many scrambling to find ways to attract and retain skilled talent.   

While the great resignation is affecting all industries, the retail and services industries are among the hardest hit. Some businesses have had to adjust their hours or close last-minute as they cannot find enough staff to cover the required shifts.   

But, what exactly is causing the labor shortage in the service and retail sectors? More importantly, will it affect the coworking industry, and if so, how?  

Service and retail labor shortages: the ‘why?’  

The labor shortage in the service and retail sectors is quite considerable. Over 900,000 retail jobs are currently open, with few interested in these positions. Instead, vast numbers of workers from the retail and service sectors have either already quit or are planning to quit their jobs.  

When considering the reasons behind The Great Resignation, pay and benefits are natural thoughts to bear in mind. Indeed, virtually all The Great Resignation consists of are people who are looking for something better. Part of that surely entails seeking better pay and benefits.  

However, something slightly different is happening in retail and service. Retail companies “are dangling perks such as triple-digit sign-on bonuses, free college tuition, and record-high wages… but it’s still not enough to move the needle.”  

Traditional benefits –like increased wages and health insurance– are now, for many workers, besides the point.  

Schedule flexibility is one significant driver of the current labor shortage. Not only that, but a general shift in priorities seems to be the leading cause behind this labor shortage.  

Having worked in retail/service and having known endless friends who’ve also worked in these sectors, there’s a consensus among workers in these fields that workers are disposable –at least that’s how they’re made to feel. These jobs are generally devoid of predictable scheduling, consistent wages, and any opportunity for career advancement.  

Indeed, it’s to the point where suicide rates are on the rise amongst retail and service workers.  

Experiencing this is greatly disillusioning. And with decreases in staffing because of these conditions, those left in the field are expecting all-time high rates of stress.  

The pandemic gave us all time to reflect on our priorities. One such focus is where we stand in our relationship to work.  

Before the pandemic, we were so caught up in the hustle and bustle of our workflows that many of us never had the opportunity to see anything wrong with it. Quarantining during the pandemic –which may service and retail workers were required to do, as they were not considered ‘essential workers’—may have illuminated this inability. 

Realizing that the reason you couldn’t move on from a job you disliked, because the very nature of the job made thinking about such things difficult, is undoubtedly not an easy piece of news to digest.  

Nonetheless, it’s clear that –having gotten time to think about it during quarantine– understanding this has led many to leave these jobs with no intentions of returning.  

The result is that now there’s an 8.4% unemployment rate in food service, along with a 6.4% unemployment rate in the retail industry. For comparison, the current total unemployment rate in the U.S. is 4.8%. 

What does the labor shortage mean for coworking spaces? 

Coworking spaces heavily rely on service workers to maintain their status as distinct and ‘better’ than ordinary offices. Specifically, community managers work to make coworking spaces a pleasant place to work for all, and that members are actively engaging with their services.  

But, in light of the labor shortage in the service sector, how will coworking and flexible workspaces cope?  

Being a community manager in a coworking space is demanding –they are the first point of reference for members on most matters of importance. Not only that, but the pay community managers receive isn’t what many would consider competitive.  

As it stands, there hasn’t been much in the way of research done studying whether or not there is a labor shortage among coworking community managers.  

Anecdotally, however, there are accounts of those who have left the service and retail industry to become community managers. And in these accounts, the message is fundamentally the same: workers want to feel like they belong to something that matters, and that the work they do has broader import outside of merely receiving a paycheck.  

Generally speaking, those who work in the coworking space see coworking as a movement that they’re a part of. Coworking spaces are intended to facilitate creativity and social bonding in ways otherwise not found in traditional work enjoyments –or even new ones, like working remotely. And there is an ample market for these spaces, as many remote workers are tired of working from home or from coffee shops.  

Given that the fundamental reason for the Great Resignation is the pursuit of meaningful work, coworking spaces should have little to worry about when it comes to labor shortages. On the one hand, the industry will inevitably grow over the next few years. And on the other, at least anecdotally, generally workers in coworking spaces see themselves as part of something important. 

Surveys suggest that most community managers are happy and passionate about their jobs. These surveys do suggest that they like their jobs slightly less than they did prior to the pandemic, but this surely applies across the board for us all. 

Data suggests that most  community managers have been in their positions for 5 years or longer, which is telling –if they didn’t see their work as worthwhile, we’d instead see ample data that they’ve joined the rest of the retail and service industry!  

People in the coworking industry find the work they do meaningful, and anecdotes present hope that those exiting the traditional retail and service industries may decide to join them. All-in-all, the coworking space will continue to flourish and grow as time goes on. Demand is high, supply is continuing to increase, and workers are generally happy. 

If anything, traditional retail and service jobs ought to work to resemble coworking spaces more if they’re to combat the deleterious effects on their industry from the Great Resignation. 

3 Tips for companies on combating the retail and service industries 

Don’t drop the improved wages and benefits. 

Improved wages and benefits are always a good incentive for people to work. Industries that require retail and service labor are now setting these enhanced perks as a precedent. And just because many workers do not feel that this is enough doesn’t mean you should throw your hands up in the air and do away with the effort entirely.  

All that will do is drive more people away.  

Provide on-the-job training 

Employers often say that those who apply for their open positions aren’t experienced enough to do the job. However, the reality we’re living in is that those who are experienced enough have had enough, and it’s not likely that they’ll be coming back.  

If they are trained, retail and service jobs are perfect options for young workers looking to get their first job. 

Imagine being a teenager or young adult looking for your first job. Getting a job that trains you to be a good worker, pays well, and provides benefits can be a great motivator for many.  

Job flexibility 

The main complaint of service and retail workers who’ve quit or plan to quit their jobs –along with those who are reluctant to enter these industries– is a lack of flexibility. Therefore, flexible schedules are a necessary compromise that companies need to make to truly brace for the holiday season.  

In short, given that millions of people are quitting their jobs, the high demand for service and retail should be taken seriously. But, unfortunately, with a projected 350,000 worker shortage for the upcoming holiday season, things aren’t looking too good.  

For these companies, this demand needs to be met. To do so, such companies must listen to the needs of retail and service workers. Make it, so people don’t have to feel like they have to live with the unpredictable –so they don’t have to feel stuck at the job they don’t like but wish they liked. Encourage engagement and open up honest dialogue. It won’t just be good for business, but for everyone involved.