Does Workspace Density Still Matter?

Too often, corporate heads of real estate and brokers tend to lock themselves into a specific density number they use to make projections about workspace needs. But this “magic number” approach obscures a more fundamental truth: employee experience has to be viewed through a holistic lens. Considering the limitations of what can be learned through square-footage-per-employee projections, should density still be at the center of workspace decision-making?

Densification is on an upswing, with more companies today allocating less square footage per employee. Tighter densities aren’t surprising, given the current struggle to keep up with headcount in a job market that’s posting strong growth and dramatically low unemployment. Indeed, the average U.S. office square footage per employee has declined to 194 (an 8% drop since 2009), according to Cushman and Wakefield.

But while organizations strive for efficiency to save on office space costs, an overly crowded workspace can actually hurt employee productivity and happiness. This fact doesn’t bode well for turnover rates (especially in one of recent history’s tightest labor markets). Moreover, studies show that employees need a positive human experience in the workspace to reach peak performance. According to research from Deloitte and MIT, companies with the highest-rated employee experience achieve double the innovation and customer satisfaction levels than lower-rated competitors, while increasing profits by 25 percent.

When it comes to workspace density, businesses should never overlook the employee experience. The reality is that there’s no magic number representing the ideal employee-to-space ratio. When evaluating rentable square feet (RSF) per person, the focus should be on supporting how employees work best as individuals, and that means tailoring a space where they’re able to focus, grow, and perform.

Use It or Lose It

Workspace effectiveness is not about doing the most in the least amount of space, but optimizing how that space is being used. Companies need to understand who is using which spaces, why they’re using them, and how often they’re being accessed, so they can prioritize spacing needs for current and future business goals. This process of workspace utilization plays a key role in calculating office occupancy metrics.

There are also some striking misconceptions between the way spaces are designed and how they’re actually used on a real-world basis. A good example is wrong-sized meeting rooms. Most companies believe that meeting rooms should be designed to fit an average of six to eight people, but the vast majority of meetings are actually much smaller, making two- or three-person meeting areas the ideal target. Having more of these right-sized rooms reduces wasted space and enhances overall business efficiency.

A recent report from workspace data firm Density looked at more than 10,000 hours of data across 60 corporate meeting rooms. Meetings with four to six people accounted for 40 percent of all meetings, while 36 percent of the time meeting rooms were monopolized by a single person—mostly to compensate for a lack of private areas for focused work and calls.

Another common misconception is that each desk equals one employee. Depending on industry and function, not everyone needs a desk all the time. In fact, by using shared desking or unassigned seating, a business can actually have a tighter density per person without assuming everyone should be at a desk because half the time the desks are not occupied.

This method of determining actual density (instead of perceived density) also accounts for the rate at which employees show up, which gives workspace designers more square footage to use for the office pantry, bathrooms, meeting rooms, soft seating, and other shared areas.

Find the Right Balance

So, how should we be thinking about density if it’s not a cure-all for maximum productivity? By taking a more people-centric approach: businesses should view densification with a focus on the diverse ways that employees work in their day-to-day lives. Ultimately, this way of thinking can help drive down costs per person by optimizing the utilization of a wider variety of work settings.

The key here is determining whether a workspace has the flexibility to provide a balance between individual work, collaboration, and community. This includes a strategic mix of focus rooms and shared workspaces, conference rooms of diverse sizes and layouts, and communal spaces to socialize and take breaks.

CBRE’s research reinforces the importance of balance, showing that there should be a roughly equal breakdown between space dedicated to individual team members and space allocated to group and community activity—and that ratio doesn’t have to be static.

Change with the Times

A dynamic approach to density enables companies to flex and scale. As the demand on a workspace grows with rising headcount, companies need to consider their maximum utilization rate. Conversely, in leaner times, they have to think about a workspace’s minimum use rate and whether that justifies expenditure.

Fortunately, one-third of companies using flexible space report occupancy cost savings of more than 5 percent, and since people and real estate tend to be the highest costs for a business, those savings can be considerable.

Simply put, cramming in employees like sardines and thinking about space in a static way is shortsighted. As for density targets and planning for the future, the most essential thing to remember is your workplace’s primary purpose: providing an environment for employees to be productive and satisfied—a place they actually want to be.