The Lone Star State and its capital city of Austin score highest in combined workplace flexibility AND economic development performance. But when it comes to where company employees work, even relatively less accommodating territories still have plenty to flex about.
Last spring we checked in with reports and leaders in workplace metrics to see how remote work was affecting office attendance and team cohesion. There were two camps then, and there continue to be two camps now, according to San Francisco–based workspace planning and coordination firm Scoop, which just published its latest findings in “The Flex Report Q4 2023.” Among them:
- One-third of U.S. companies offer “Full Flexibility,” meaning corporate employees do not have to come into the office and have a choice. “That’s consistent from Q3 2023 and up two percentage points from the beginning of 2023,” Scoop reports. Only 7% of companies are fully remote with no office space.
- Most companies fall under the “Structured Hybrid” model, which includes a range of specific expectations defined by number of days per week in the office, specific days in the office or a minimum percentage of time in the office. A total of 87% of Structured Hybrid companies require two to three days per week in the office.
- The percentage of companies requiring Full Time In Office has dropped from 49% at the start of 2023 to 38% today. Based on data as younger companies’ practices take root, Scoop expects Full Time In Office “to decrease to 15% or less of U.S. companies over the coming years.”
- Technology (97%) and Media & Entertainment (92%) are the most flexible industries in terms of work location, followed by Insurance, Professional Services and Financial Services.
What About Location?
With 89% of companies offering some work location flexibility, Massachusetts is No. 1 in The Flex Index’s ranking of states by flexibility, followed by Washington, Oregon, Colorado and California. The least flexible (among the 41 states from which Scoop received input) are Mississippi, Kansas and Alabama, though it’s relative: More than 50% of companies in Mississippi offer some flexibility.
Among 109 metro areas analyzed in the report, San Jose, California (93%); San Francisco, California (91%); and Austin, Texas (91%), are home to the most employer flexibility, followed by Seattle, Washington, and Boston, Massachusetts. Chattanooga, Tennessee; Knoxville, Tennessee; and Wichita, Kansas, are the least flexible, though, again, each of these metros boasts flexibility from more than 50% of companies.
From 2020-2022, the average Fully Flexible public company outperformed peers by 16 percentage points in revenue growth on an industry-adjusted basis (21% growth vs. 5% growth). “Even excluding Tech, Fully Flexible public companies outperformed their peers by 13 percentage points,” says Scoop. Structured Hybrid outperformed “Some Office Time Required” by just one percentage point (6% vs. 5%) but doubled the Full Time in Office crowd’s growth, which was the lowest at 3%.
But how do those companies’ host states and metros perform when it comes to economic development? For that I turned to the most recent editions of Site Selection’s various rankings. For the states, that means Governor’s Cup (cumulative corporate facility projects in 2022); Governor’s Cup Per Capita; Prosperity Cup (an index of 10 criteria including project data); and Business Climate rankings (a separate set of nine criteria).
Among the top 20 states in company work location flexibility, only one ranked in the upper echelon across all Site Selection rankings: Texas, which ranks No. 11 in flexibility, took the top spot in our Governor’s Cup and Business Climate rankings and even ranked No. 7 in corporate facility projects per capita last year. Two other top states in flexibility make the charts in three of our four rankings: North Carolina (No. 15 in flexibility) and Georgia (No. 16).
Meanwhile, three states in the lower ranks of workplace flexibility still rank highly across all four of our rankings: Indiana (No. 27 in flexibility), Ohio (No. 29 in flexibility but with the highest average performance across our rankings) and Kentucky (No. 35 in flexibility).
For metros, I looked at our annual Top Metros and Top Metros Per Capita rankings, based solely on project data in Site Selection’s Conway Projects Database.
At the metro level, across our separate top 10 rankings of regions in two population categories (200,000 to 1 million and 1 million and above), only one metro area scores in the top 20 in employer flexibility while making both our cumulative and per-capita top 10s: Austin, Texas, is third in flexibility, while scoring a No. 7 finish in corporate facilities overall in 2022 and a No. 1 finish in corporate facilities per capita.
Among top flexibility metros who scored top 10s in one of our two metro-area rankings were No. 8 Top Metro Boston (No. 5 in flex), No. 4 Top Metro New York (No. 12 in flex) and No. 5 Top Metro Los Angeles (No. 15 in flex).
Those with flexibility outside the top 20 but high economic development performance include the following, listed by order of their total Site Selection rankings performance across cumulative and per-capita categories, with their flexibility ranking in parentheses:
- Dallas, Texas (38)
- Chicago (24)
- Allentown, Pennsylvania (74)
- Greenville, South Carolina (69)
- Cincinnati, Ohio (68)
- Savannah, Georgia (96)
Such communities might just offer the right mix of employee flexibility and economic productivity. Scour the linked sets of rankings to draw up your own conclusions.— Adam Bruns
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