The real reason your company switched to an open plan office

[Source Image: tarras79/iStock]

Open offices suck. Recent research shows that they can decrease face-to-face collaboration and increase email, diminish employees’ productivity, reduce focus, and even promote sexism. While there may be a time and place for open workspaces, workers themselves tend to hate them. So why do companies love them?

A new data analysis by Erik Rood offers one simple explanation: They save companies insane amounts of money.

Rood points out that the average amount of space per worker has been shrinking for years. According to some research, adopting open plan workspaces has helped drop the average square footage per worker by about 33% in just seven years. Using publicly available data from some of the largest S&P 500 companies, he offers a rough estimate of what the savings might look like–multiplying the square footage they’d expect to save by going open plan times the number of employees and a baseline cost per square foot for office space.

[Image: courtesy Erik Rood ]

While such an estimate is rough, and Rood assumed key details like the cost per square foot at $50–which may be high or low, depending on location–and a standard amount of space savings in general, the numbers are nothing short of amazing. In theory, corporations like JP Morgan may have avoided spending more than a billion dollars over seven years by adopting open plan offices, which may translate into more than a 3.5% of its profits.

Still, as Rood points out, this doesn’t account for the loss of productivity that open plan design seems to have on workers. You can read his full analysis here. JD