WeWork (WE) recently rattled investors by declaring there is “substantial doubt” it will be able to continue operating as a business.
This warning has experts worried bankruptcy may be on the horizon for the coworking company that was once valued at $47 billion.
But WeWork is no longer representative of the co-working industry as a whole. The pandemic-triggered a surge in remote work that is still going strong, as more companies are looking to accommodate hybrid work environments.
The Remote Work Wave
As of 2023, nearly one-third of the US workforce has adopted a hybrid work schedule, while 12.7% of employees have gone fully remote. Freelancing platform Upwork (UPWK) estimates 32.6 million Americans will be working remotely by 2025.
Plenty of employers have pushed back on this trend, with major companies like Google (GOOGL), Amazon (AMZN), and JPMorgan Chase (JPM) asking workers to return to the office in recent months. But for many workers, these demands fall on deaf ears.
In response, many companies are looking to make changes to their work cultures instead, swapping long-term office leases for more flexible arrangements like coworking.
The Future of Work
The coworking industry was growing even before the pandemic. With the added momentum, Market Reports World now forecasts a compounded annual growth rate of over 17% between now and 2028 for the flexible work industry.
WeWork may be the exception, not the rule. Jersey-based workspace company IWG (IWGFF) recently posted a 48% surge in half-year profits. Meanwhile, Industrious CEO Jamie Hodari stated the flexible workspace provider just experienced “the strongest performance in the history of the company.”
So, even if WeWork’s worst case scenario pans out, the industry it popularized is alive and kicking.
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