Are coworking spaces the key to transforming Gateway Cities?
This article is the second in a three-part series discussing pandemic recovery strategies with the potential to support inclusive, long-term economic development in Gateway Cities. Read the first part here.
The coronavirus pandemic has impacted every aspect of daily life, and the economy is no exception. Entire workplaces have gone virtual while others have shuttered. Thus far, many Gateway City residents have struggled to telework due to many factors, including digital inequities and spatial constraints. Although these challenges are clear, they are not insurmountable. Gateway City coworking facilities can provide space and resources for residents to join the digital workforce while also positioning downtowns as bustling hubs for the entire region.
Current Reality: Fewer Gateway City Residents Work Remotely than One Might Think
Reports of record job losses and furloughs have dominated COVID-era headlines. But some sectors have experienced a higher level of job security and stability because of possibilities for remote work. Before the pandemic, telework had been more common among higher wage earners in professional services, finance, information, and similar industries with limited in-person interactions, as well as among women and those with bachelor’s or advanced degrees. According to a Pew Research Center study released in March, of the highest 10 percent of private sector wage earners, 25% had access to telework, whereas only one percent of the lowest quartile of private sector wage-earners could work remotely. Since only 15% of Gateway City workers were employed in high-wage professional jobs, most had slim chances of teleworking (see Fig. 1).
FIGURE 1 – Employment by Industry in the Gateway Cities
U.S. Census Bureau. (2018). American Community Survey 5-year Estimates.
FIGURE 2 – Average Unemployment Rate by Geography, January to August of 2020
The Commonwealth of Massachusetts. (2020). Labor force and unemployment data. Mass.gov. Retrieved from https://lmi.dua.eol.mass.gov/LMI/LaborForceAndUnemployment. Accessed on October 28, 2020; U.S. Bureau of Labor Statistics. (2020). Unemployment Statistics. United States Department of Labor. Retrieved from https://www.bls.gov/bls/unemployment.htm. Accessed on October 28, 2020. Credit to Will MacArthur his contributions in the creation of this map.
Many Gateway City residents were working in industries dependent on in-person interactions, like restaurants, retail, and personal care services. The dominance of high-contact sectors drives Gateway Cities outpacing the Commonwealth in unemployment claims, as seen in Figure 2. Outsized COVID-19 impacts and below-average wages have magnified socioeconomic divides within Gateway Cities and between them and neighboring municipalities. Figure 3 shows pre-pandemic earnings, and Gateway Cities stand out in most regions. For example, households in Lawrence earned a median of $41,600 — just 28% of what households amassed in neighboring Andover ($148,000). Worcester households brought home roughly 59% of its lowest-income neighbor, West Boylston. Across the map, similar inequities persist.
FIGURE 3 – Median Earnings of Private-sector Workers in Gateway Cities and Surrounding Communities, 2018
Source: U.S. Census Bureau. (2018). American Community Survey 5-year Estimates.
These wealth inequalities have undoubtedly contributed to why many Gateway City residents have been, so far, unable to access remote work opportunities and options. Up to 40% of households in some Gateway Cities lack internet and computer access, creating an irrefutable digital divide. Remote learning has added to this gap by increasing the load on existing digital infrastructure. Also, not every resident has sufficient space or privacy to work remotely and without the distractions of multigenerational care and homeschooling responsibilities. If suburban teleworkers lack space and access to basic amenities, the situation could be even more dire for workers in Gateway Cities, where crowding has also exacerbated the spread of the coronavirus for those burdened by high rents and low wages.
Coworking Spaces for Regional Development
Pandemic recovery efforts can, and should, include developing a telework-ready economy. Coworking spaces deliver near- and long-term solutions for economic development, helping both local and regional residents. People who cannot work safely or effectively from home need alternatives: coworking infrastructure provides flexible space for remote workers and allows flexible growth and connectivity options for small businesses.
Recent research shows that residential rents are holding steady or rising as much as 9% in Gateway City markets far from Boston’s core, where rents have been dropping as much as 7%. This trend indicates that demand for lower costs and more space could be attracting teleworkers to regional hubs. Unlike some wealthier neighbors, Gateway Cities have the density, vacant buildings, and urban framework to support coworking spaces. Flexible coworking spaces for telework and entrepreneurs bring and keep workers into downtowns, which in turn activates vacant spaces and boosts foot traffic for local businesses. Telework-ready districts can also produce new municipal revenues to invest in technology, infrastructure, and other resources that benefit all Gateway City residents. Best of all, coworking locations complement satellite offices (Part 1 of this series), establishing a mix of workplaces and sectors as part of a broader plan for inclusive economic development.
Innovative coworking spaces have already been helping position Gateway City transit-oriented districts and downtowns as centers for telework and development. The UMass Lowell Innovation Hub supports tech-based early-stage companies and startups in Lowell and Haverhill with desk space, shared technology, small-site manufacturing, and related services, like funding and professional network building. State incentive programs like Collaborative Workspace grants have helped finance coworking spaces like Make-It Springfield, a community-run maker’s space where Pioneer Valley residents can refine their skills as they build their businesses. More support will be needed to expand these opportunities and upgrade existing ones for pandemic recovery.
RecommendationsThe state should consider additional policies for creating and sustaining coworking spaces in Gateway Cities. First, increase base funding for operations and safety for Regional Transit Authorities (RTAs). Better-supported RTAs can boost service, reliability, and frequency and safely connect teleworkers to coworking centers without adding congestion to increasingly busy local roads. Second, broadband infrastructure and access must improve if we want to bridge the digital divide. Coworking spaces can address disparities in access to broadband and digital equipment, however more resources will still be needed to help all Gateway City residents connect online and take advantage of teleworking jobs and remote learning opportunities.
Third, the state can provide incentives to align programs for supporting caregivers who also telework. The pandemic has widened the gender wage gap as many women have scaled back or quit their jobs to take on care additional responsibilities. State agencies can prioritize projects that co-locate child and adult daycare with coworking facilities. Alternatively, the state can establish an in-home care program where qualifying families could use stipends or credits to ease caretaker responsibilities while working from home. As we combat a third wave of COVID-19 infections, the state would do well to keep people closer to home and develop a telework-ready economy by activating Gateway Cities with coworking space.