Saturday, 15 March 2025
A new study by the International Workplace Group (IWG) has revealed that businesses operating with hybrid work models are significantly more optimistic about their prospects for 2025 compared to those requiring full-time office attendance. The research, which surveyed more than 1,000 CEOs and senior business leaders, found that 75% of companies offering flexible work arrangements have a positive outlook for the year ahead, compared to 58% of businesses that do not offer hybrid options.
The findings indicate that flexible work arrangements contribute to reduced overhead costs, improved employee productivity, and a stronger ability to attract talent. More than three-quarters (79%) of hybrid businesses reported cost savings by reducing office space and utilizing short-term workspace solutions. Additionally, 75% of these businesses see hybrid work as a way to manage economic pressures such as rising taxes and market fluctuations.
The study also highlights that businesses prioritizing workplace flexibility are more confident about broader economic conditions. While 63% of hybrid businesses reported feeling more positive about the economy than they did a year ago, only 44% of non-hybrid businesses shared the same sentiment.
Impact on Productivity and Workforce Growth
Workforce productivity and employee retention emerged as key drivers behind the optimism among hybrid businesses. According to the survey, 72% of flexible businesses reported increased productivity, and 71% said their policies have strengthened their ability to attract and retain top talent. These findings align with research by Stanford professor Nicholas Bloom, which showed that hybrid work improves job satisfaction and reduces employee turnover by 33%, without negatively impacting productivity.
The study also found that companies with hybrid work policies are more confident in their ability to expand. Among these businesses, 67% expect growth in 2025, compared to 51% of non-hybrid businesses. Similarly, 48% of hybrid businesses anticipate increasing their workforce, compared to 38% of those requiring full-time office attendance.
Industry Perspectives
Mark Dixon, CEO of IWG, noted that businesses embracing hybrid work models are positioning themselves for long-term success. “In these challenging times, business leaders are thinking about the best way forward. Companies that prioritize talent retention and operational efficiency are the ones showing the most confidence. By adopting hybrid working, businesses are not only reducing costs but also fostering a more productive and satisfied workforce,” Dixon said.
As economic uncertainty continues, the research suggests that businesses with flexible work arrangements may have an advantage in navigating future challenges while maintaining a competitive edge.
Photo: Mark Dixon Founder and CEO IWG Copyright Ian McIlgorm
