Stuck in Their Homes, Workers Shun Relocations
Employee relocation numbers hit a record low in the last quarter of 2009, according to the Challenger Job Market Index, a national survey of 3,000 job seekers. This finding is one of three job relocation trends that emerged in the last 18 months as both employees and employers coped with recession.
Challenger, Gray & Christmas, the global outplacement consultancy that conducts the quarterly survey, says the 7.3 percent of the respondents who relocated late in 2009 was the lowest since the survey began in 1986. Yet 2008 was the worst year overall, with an annual average of 11.6 percent of job seekers moving for new positions; 2009’s annual average was 13.3 percent, the second-worst year since 1986.
“People are stuck in their homes, unable to sell them,” explains John Challenger, CEO of the consultancy. “It’s more noticeable among boomers.”
Another factor contributing to the low relocation stats are the cases of two-career couples in which the husband lost a job, particularly if he worked in the hard-hit construction or manufacturing sectors. Where these men’s spouses were employed, the couples “decided to stay put instead of looking for that kind of work and let the wife’s job be the anchor,” Challenger says.
Job creation was also low in 2009, and unemployment and underemployment were, and still are, at record levels. “Employers just decided that with their large local potential employee pool, they wouldn’t risk bringing outsiders in,” Challenger says.
Although that strategy may save money, Challenger says it’s a risk too. “It means less cross-pollination and less ability to attract top talent.”
Brookfield Global Relocation Services, an international relocation company, has seen the same downward trend in relocations. “We usually move about 25,000 people per year in the United States,” says company vice president Scott Sullivan. “We’ve seen a reduction of 10 to 15 percent over the last 18 months.”
Brookfield identified a second trend supporting the Challenger survey findings that boomers have been especially reluctant to relocate. “We have seen a lot more relocation for renters than for homeowners,” Sullivan says. “In the last 18 months, we’ve moved 10 percent to 15 percent fewer homeowners than usual versus an increase in renter relocation of 20 percent. Generally, renters tend to be a younger demographic.”
International moving company SIRVA has noted a third trend. “Companies are reducing the number of people they’re moving and increasing benefits for those they are,” says Wendy Komac, SIRVA’s senior vice president of global sales.
Companies are especially covering the loss on sale of homes, a very expensive corporate benefit, says Komac. “Most organizations are offering this loss-on-sale benefit to their executive-level tiers,” she says. But companies will also offer the benefit to key people, even if they aren’t executives.
Challenger says relocations usually increase in a recession because people look elsewhere when they can’t find jobs locally.
“The reduction in relocations says that in this recession, companies haven’t had money for anything,” he says. “As the economy turns around, employers may create more incentives to induce people to move, but they’ll tilt toward the most talented and higher-level employees.”
Workforce Management, March 2010, p. 10 -- Subscribe Now!