The nation’s slow housing market has taken a toll on recruiting and relocating new hires and current employees. Employers are mostly avoiding relocations when they can, experts say.
“There isn’t a whole lot of hiring going on and not a lot of relocations,” says Eileen Levitt, president at the HR Team, which provides HR services to small and midsize businesses.
Sometimes the position level makes the difference. Lisa Chenofsky Singer, a career management coach and HR consultant at Chenofsky Singer & Associates, says most companies are only looking for talent on the local level for midlevel and below.
“At the higher levels, relocation is still being offered, but many executives are not always choosing to move their family, but rather telecommute by plane weekly with a stronger housing allowance and maintaining an alternative residence midweek for themselves,” Chenofsky Singer says. “Many believe to uproot their family, if this position only lasts one to three years, is not worth the transition on them.”
Younger workers without a mortgage and children may be more willing to move.
“Companies are currently relocating the younger, more mobile crowd that has little more than an apartment or condo lease to get out of. As for full-scale relocations, those have been much lessened by work-from-home [arrangements], especially in certain industries,” says Frank Risalvato, the founder and recruiting officer at the recruiting firm Interregional Executive Search.
Impact on recruiting
The sluggish housing market is leading recruiters to use different strategies and benefits geared toward today’s economy.
“The housing market of today is definitely impacting recruitment techniques,” says Dianne Durkin, president of Loyalty Factor, a consulting and training firm. “Individuals can be resistant to accepting new positions knowing that their homes may not sell easily. At the same time, in this economy, they are anxious to find work. In many cases, they are willing to make sacrifices.”
Al Clark, a managing partner with MGT Recruiters, has witnessed candidates who couldn’t afford to move. “Absolutely that’s going to be a challenge to overcome,” he says.
“It was hard for people to relocate before. We’re seeing people, quite frankly, telecommuting,” says HR Team’s Levitt. “If the person has a job already, they’re leery to leave that job, especially if that job involves relocating. If they don’t have a job, it’s a very difficult conversation [about relocating]. I’m not seeing a whole lot of relocations in general.”
Bigger changes are coming in recruiting, according to Paul Rasmussen, national director of recruiting for FAF Inc., a trucking company.
“We have spoken to potential candidates who have said unless we can provide buyout packages, they would not be able to move because they are upside-down in their homes. I believe the landscape of how we recruit and retain new employees will change this and next year. Our candidate pools are becoming more regionalized, and even with the unemployment rates continuing to stay high, it is slowly turning into an employee’s market for skilled talent,” Rasmussen says.
Despite these challenges, relocation benefits aren’t on the rise. Although it happened regularly in the past, it’s rare these days for a company to buy a relocated employee’s home if it doesn’t sell quickly, Clark notes.
A lump sum for relocation costs is probably the most common strategy now. Durkin says employers have not increased their relocation benefits to accommodate the employee.
“In fact, because of the economic situation, many companies have reduced their relocation benefits,” Durkin says. “The result is individuals are becoming much more creative and innovative around their housing options. For example, they may choose to rent their primary home location until the market turns around for sale. They are offering lease with options to buy to possible future owners. They are renting at the new location until their primary location sells.”
In one case, a client chose to move to the new job location without family for six months.
“If at the end of the six months the primary home location does not sell, they will rent that home, and everyone will relocate to the new job site,” Durkin says. “Another example we have encountered is a husband and wife who have chosen to live apart until the spouse is able to find comparable work in the new location.”
Relocation benefits generally depend on the company culture and the level of job within the corporate hierarchy, Levitt notes.
Tips for employers
To boost recruiting success, experts recommend being as flexible as possible in terms of the timeline for the move and the relocation benefits.
“Try to be flexible. Try to be creative in the way you compensate employees on the move,” Clark advises. “Recognize that sometimes families will be split until the home sells.”
Options include using telework to bridge the gap until the move is complete, paying for the spouse and children to visit the employee in the new location, assisting with temporary housing or paying for the employee to hire a rental company in order to rent out the old house until it can be sold.
Candidates are asking for a longer time period for relocations, according to Jennifer Kay, a managing partner at Stevenson Group. Instead of six to 12 months to relocate full time, they might need 12 to 18 months to complete the move, commuting by plane in the meantime. Candidates may ask for a hybrid, working at the new location for two weeks and teleworking for two weeks.
“The truth is, [employers] just need to be more flexible. That’s the bottom line,” Kay says.
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