Despite the current economic recession, businesses are optimistic about the volumes and budgets for future corporate relocations, according to Atlas Van Lines' 43rd annual Corporate Relocation Survey. More than one in five firms surveyed expect relocation volumes to increase in 2010, a great improvement over last year, when more than half of surveyed firms predicted a decrease in relocations.
Other positive signs include the majority of firms indicating they expect their overall financial performances to improve compared to 2009. With guarded optimism, most responding firms expect stability or even improvement in both the U.S. economy and real estate market.
The Atlas survey – the only survey of its kind – has for 43 years explored trends in how corporations move existing employees or newly hired staff. Most survey respondents work in human resources/personnel or relocation services departments for service, manufacturing, wholesale/retail, financial or government organizations, and more than half work for international companies. There is information in the survey on the number of people moved within Canada as well as between one country and Canada, plus the frequency of Canada as a destination for international transfers.
"These survey results are a possible early sign of a recovery for the relocation industry, and they indicate that companies are finding ways to contain costs while retaining employee incentives," says Jack Griffin, president and COO of Atlas Van Lines. "But the best news is that firms are predicting a brighter future both for themselves and the overall economy."
Here's a closer look at developing trends in corporate relocation:
Employees more willing to relocate
Employees appear to have been a little more willing to relocate in 2009 than they were the previous year. More than half (56 per cent) of responding firms saw employees decline relocations compared to 65 per cent in 2008. For the second year in a row, housing/mortgage concerns surpassed family issues/ties as the number one reason for refusing relocation. Seventy-seven per cent of respondents cited housing concerns, including worries about selling a home, as the reason for declining relocation.
However, 66 per cent of firms responding offered employees incentives to encourage relocations, with relocation bonuses, loss-on-sale protection, cost-of-living adjustments and extended duplicate/temporary housing benefits rounding out the top four methods used. In 2009, extending duplicate/temporary housing benefits jumped to the most popular perk, with 69 per cent of firms offering this incentive. So successful were these incentives that 90 per cent of companies said they "almost always" or "frequently" convinced an employee to relocate. Forty-five per cent of companies also help an employee's spouse find work in a new location.
Economy, not lack of local talent, impacting moves
For the first time since 2003, a lack of qualified people locally was not the biggest influence on relocation. Instead, more than half (53 per cent) of companies cited economic conditions as the biggest influence on relocations, with just 31 per cent citing a lack of qualified people locally. And 37 per cent say declining an opportunity that involves relocation can hinder an employee's career.
A more encouraging outlook for 2010
Responding firms indicated the number of employees relocated and relocating budgets significantly decreased compared to 2008. Forty-two per cent said they moved fewer employees last year, compared to just one-fourth experiencing declines in relocation volumes in 2008. Additionally, over a third saw decreases in relocation budgets last year (compared to 19 per cent in 2008); while only 18 per cent indicated budgets increased. The percentages of firms expecting increases in relocation volumes and budgets in 2010 are roughly twice that of last year.
Internationally, relocation volume expectations improved slightly overall compared to the previous year. Nearly two-thirds of firms expect international relocation volumes to remain stable.
Survey fast facts
- Eighty-two per cent of firms have a formal relocation policy.
- Relocations were almost equally split between transferees and new hires in 2009.
- Males age 36-40 were the most frequently relocated employee in 2009; only 17 per cent of relocations involved female employees.
- Forty-five per cent of relocations involved employees with children; 60 per cent of those relocated were homeowners.
- One-quarter of responding firms give employees one week or less to accept a relocation offer.
- More than three-fourths of companies reimburse moving companies to pack all items; 29 per cent will even reimburse the cost of moving pets.
- The Midwest was the top destination of transfers (36 per cent) followed by the South (28 per cent) and the Northeast (27 per cent).
- Among international relocations, the most frequent destinations were Europe (47 per cent) followed by Asia/Pacific Rim (36 per cent).
- Over the past two years the percentages of firms using full, lump sum (relocation allotment) or partial reimbursement for new hires have become nearly identical.
Nearly 300 corporate relocation professionals completed the online survey between January 11 and February 26. Respondents must have relocation responsibility and work for a company that has either relocated employees within the past two years or plans to relocate employees this year. Half of the companies surveyed this year relocate employees between countries.
For complete survey results, visit www.atlasworldgroup.com/survey.
Atlas Van Lines is the largest subsidiary of Atlas World Group, an Evansville, Ind.-based company. Visit www.atlasworldgroup.com for more information on the company and Atlas agents.