2009 Corporate Relocation Survey

 
Results 42: Corporate Relocation Survey - Year 2009 Results 42: Corporate Relocation Survey - Year 2009
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Responding Details

To qualify for survey participation, a respondent 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. Atlas sent invitations to participate via e-mail, and 320 respondents completed online questionnaires between January 12 and February 28.

  • Most respondents (65%) work in human resources or personnel departments for firms engaged in:
    • service (36%)
    • manufacturing/processing (33%)
    • wholesale/retail (13%)
    • financial (10%)
    • government/military (3%)
    • other (5%)
  • For analysis, responding firms are categorized by size as follows:
    • 39% have less than 500 salaried employees (small)
    • 35% have 500-4,999 salaried employees (mid-size)
    • 26% have 5,000+ salaried employees (large)
  • Over half (53%) of the companies surveyed this year are international firms.


Results Highlights

Relocation Volume and Budgets

Anticipated Volumes and Budgets Drop Sharply

Projections for 2009 are not optimistic. Nearly half of all firms expect 2009 relocation volumes and budgets to decrease from 2008 levels. They also indicate relocation volumes and budgets were already trending lower last year: one out of four state 2008 relocation volumes decreased from 2007 and nearly one-fifth indicate budgets decreased as well.

The percentages of firms expecting further cuts to relocation volumes and budgets are more than double those seen the past five years. Additionally, compared to survey results during the milder economic retraction in 2002, when 30% of companies reported decreases in volumes and 26% reported decreases in budgets, it is apparent that the deepening recession will bring further cuts in 2009.

The expectation for decreased volumes among 52% of firms surpasses the biggest percentage of firms ever to predict decreases (38% in 1975), indicating the severity of cutbacks could potentially reach levels not seen since this survey began in the late 1960's.

  • The median number of relocations by mid-size firms dropped from "20–49" to "10–19" and fell from "200–399" to "100–199" among large firms; this is the first time these figures have changed since initially tracked in 2003.
  • Roughly half of for-profit service firms expect volumes and budgets to remain the same in 2009, significantly more optimistic than under a third of manufacturing/processing firms. However, while only 36% of for-profit service firms expect budgets to decrease, roughly half of both for-profit service and manufacturing/processing firms expect relocation volumes to decline.
  • More than half of international firms expect decreases in relocation volumes and budgets in 2009. Although four out of ten regional firms expect decreases, more than half of these firms expect relocation to stabilize this year. National firms are the most optimistic; roughly one-fifth expects increases in volumes and budgets in 2009.
International Relocation Volume

Anticipated Volumes Drop; Less Severe Than Overall Expectations

Interestingly, the percentage of firms expecting decreases for international relocation in 2009 is slightly less severe, with just 39% predicting decreases. Still, this is more than double the percentages reported in 2005-2008 and indicates a softening of the international relocation market. But the expected retraction appears less severe than for the overall market, specifically among mid-size and large firms.

  • Over half (57%) of mid-size firms expect international relocation volumes to remain the same as 2008, compared to just 35% of mid-size firms predicting overall relocation volumes will remain stable.
  • About one-fifth (22%) of large firms expect increases in international relocation, which is more optimistic than just 10% of large firms expecting increases in overall relocation volumes in 2009.
  • Over half (53%) of for-profit service firms expect international volumes to remain stable in 2009 and about one-fourth (26%) project decreases. Manufacturing/processing firms are significantly more pessimistic: 47% expect international volumes to decline.
Question 4: Overall Relocation Volume
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Question 44b: International Relocation Volume
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Economic Outlook

Predictions Less Optimistic for Individual Firm Performances, Overall Economy

Over a third of firms saw their own performances worsen in 2008, more than double the amount reported in the previous three years. Expectations for further worsening in 2009 are held by 40% of firms overall. The percentage of firms indicating the U.S. economy worsened jumped from 46% in 2007 to 83% in 2008, with 65% of firms expecting the U.S. economy to worsen further in 2009. Similarly, 59% of firms expect continuing deterioration in the U.S. real estate market during 2009; however, this is down significantly from last year (78%). Roughly a fourth of firms expect the U.S. economy and real estate market to stabilize this year.

  • The percentage of firms indicating their financial performance was worse than the previous year more than doubled among small and mid-size firms (31% vs. 15% and 36% vs. 16%, respectively), and tripled among large firms from 2007 to 2008 (39% vs. 13%).
  • Manufacturing/processing firms are significantly more pessimistic than for-profit service firms about financial performance projections. For-profit service firms are nearly evenly split for 2009 (34% expect better and 34% expect worse performances), but over half (53%) of manufacturing/processing firms project further worsening, and only 20% expect improvement.
  • National firms are more optimistic about financial performance projections than regional or international firms. Nearly three-fourths of national firms expect their 2009 performances will be the same or better than 2008, while close to half of regional and international firms project their 2009 performances will be worse.
  • Nationally operating firms are more likely to be optimistic about the U.S. economy; nearly half expect it to remain stable or improve this year, compared to roughly a third of regional and international firms.

 

Market Impact on Relocations

Employee Category Determines Impact

When asked how market pressures impact relocation volumes among employee categories, firms overall indicate relocations for entry level/new hire and middle management employees were more likely to see decreases than relocations for senior managers and executives. Roughly half of mid-size and large firms report decreasing relocations for the first two categories, while only a third decreased relocations for senior managers/executives. Nearly one-fifth of firms overall report relocation volumes among senior level employees actually increased in response to market pressures.

  • About half of manufacturing/processing firms decreased the number of employee relocations for entry level/new hire and middle management employees, while only 4 out of 10 for-profit service firms did so.
  • About half of international firms decreased the number of employee relocations for entry level/new hire and middle management employees, and over a third of national firms did so as well.
Question 6: Market Pressures Impact on Relocation Volumes
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Employees Declining Relocation

Significant Increases; Housing/Mortgage Issues Play Major Role

Market pressures aren't alone in pressing relocation volumes downward; employee reluctance to relocate appears on the rise as well. Roughly two-thirds (65%) of firms indicate employees declined the opportunity to relocate in 2008, and 28% report the number of declinations increased last year compared to 2007. Mid-size and large firms experienced the largest increases in declined relocations (28% vs. 11% in 2007 and 40% vs. 25% in 2007, respectively).

  • Seven out of ten national and international firms report declined relocations in 2008, compared to only 46% of regional firms. Additionally, over a third of national firms and over a fourth of international firms experienced increased declinations.

Not surprisingly, the main reason firms cite for declined relocations in 2008 is housing/mortgage concerns (70%); this is an increase of 20 percentage points over 2007 (70% vs. 50%) and roughly two to three times the percentages cited from 2002-2006, surpassing family issues/ties (60%) for the first time. Family issues/ties was the reason cited 8 out of 10 times from 2002-2006, and dropped in 2007 as the U.S. real estate crisis began to deepen.

  • For large firms, housing/mortgage concerns is by far the biggest factor, as 84% indicate employees declined relocation for this reason.
  • Housing/mortgage concerns ranks just above family issues/ties for mid-size firms (67% vs. 61%), the top two reasons employees declined relocations.
  • Small firms reflect nearly equal impacts of three issues: family issues/ties (59%), housing/mortgage concerns (54%), and spouse/partner employment (54%).
  • At for-profit service firms, housing/mortgage concerns surpasses family issues/ties by a slim margin (77% vs. 71%), while at manufacturing/processing firms these two issues tie (64%).
Question 10a: Select Reasons Relocations Declined: 2002-2008
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Relocation Incentives

Majority of Firms Offered Incentives in 2008; COLAs & Relocation Bonuses Most Popular; Highly Successful

Most firms, regardless of size, offered additional incentives to encourage employee relocations last year. Among firms offering incentives, roughly two-thirds (regardless of size) offered cost-of-living-adjustments (COLAs) in salary at the new location, and more than half offered relocation bonuses. For the vast majority of firms (8 out of 10 or more), regardless of size, additional incentives proved "almost always" or "frequently" successful in convincing an employee to relocate.

  • Regional firms are less likely than national and international firms to have offered additional incentives (48% vs. 67% and 61%).
  • National firms offered COLAs and relocation bonuses with similar frequency (64% and 63%), but regional and international firms report they are more likely to have offered COLAs than relocation bonuses (58% vs. 48% and 69% vs. 55%, respectively).
  • Manufacturing/processing firms offered COLAs and relocation bonuses with similar frequency (63% and 65%), while for-profit service firms are more likely to have offered COLAs than relocation bonuses (67% vs. 51%).

 

External Factors

Lack of Qualified People, Economic Conditions, and Real Estate Market Impact Hinge on Company Size

Overall, the impact of lack of qualified people locally, economic conditions and the real estate market are nearly equally weighted, revealing firms felt a triple-threat of external pressures on relocation. The percentage citing economic conditions is similar to 2002-2004, up significantly from 2005-2007. The lack of qualified people locally remains mostly similar over the past seven years, except for 2003 and 2005. Even with the rise of economic concerns and the real estate market as key external issues, the lack of qualified local talent remains a major issue for many firms, nearly equal or greater in impact to financial pressures. While the impact of economic conditions has been rising and falling over the past 25 years, the lack of qualified local talent has been trending upward. However, the impact of these factors last year varies greatly by company size.

For small firms, a lack of qualified local talent (51%) was the top issue in 2008 as it has been for the past seven years, still outweighing economic concerns. For large firms, economic conditions (55%) and the real estate market (52%) were the top external factors. The percentage citing economic conditions is similar to 2002-2004 (60%, 70% and 57%) and jumped significantly from 2006-2007 (35% & 32%); the percentage citing real estate increased 15 percentage points from 2007.

For large firms, the lack of qualified local talent (37%) remains at similar levels to 2007 (39%) but falls from the highs seen in 2005-2006 (50%+). Mid-size firms felt the impact in 2008 of all three factors nearly equally (real estate market 50%, lack of qualified people locally 46%, and economic conditions 44%). However, the percentages indicating the real estate market and economic conditions as major factors more than doubled from 2007 (50% vs. 18% and 44% vs. 18%), while the lack of qualified people locally returned to levels similar to 2002-2004 (45%, 36% and 49%). Compared to the past three years, this reflects a dramatic increase in the impact of economic concerns and a moderate decrease in the impact of a lack of qualified local talent.

Additional Insights:

  • Lack of qualified people locally and economic conditions top the list for manufacturing/processing firms (45% and 44%, respectively) with the real estate market a close second (36%). These three factors are practically equal in impact among for-profit firms (45%, 45% and 44%, respectively). One key difference: manufacturing/processing firms are nearly five times more likely to report the increase of competition, whether domestic or international, as playing a major role in their relocation volumes (29% vs. 6%) in 2008.
  • Over half (55%) of regional firms cite the lack of qualified people locally, significantly more than any other issue. National firms, however, cite the lack of qualified people locally and economic conditions nearly equally (45% and 44%, respectively) with the real estate market a close second (35%). Among international firms, the top issues are economic conditions and the real estate market (47% and 46%, respectively) followed closely by the lack of qualified people locally (42%).
  • International firms cite the real estate market much more frequently than regional or national firms as playing a major role in relocation volume last year (46% vs. 29% and 35%, respectively). Additionally, nearly one-fifth of international firms cite the growth of international competition, while virtually no regional or national firms do so.
Question 12: Select External Factors Impacting Relocation: 1988-2008
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Internal Factors

Company Growth Retracts Further and Surpasses 16-Year Low; Budget Constraints Growing

Overall, the impact of company growth on relocation volumes in 2008 falls to 33%, past the lowest percentages cited in 1991-1992 (38% and 39%) and significantly below 2003-2007, indicating significant retraction compared to the past five years. Additionally, the impact of budget constraints increases significantly compared to the past three years, although still lower than 2002-2003. Regardless of size, the percentages of firms citing company growth as a major factor impacting relocation volumes are the lowest in seven years, and the percentages of firms citing budget constraints are roughly double compared to 2005-2007, lower than 2002-2003 but near 2004.

While the top internal factor varies by company size, the dramatic decrease in company growth and increase in budget constraints is the key trend across all size firms. Nearly half of large firms (45%) indicate corporate reorganization as the biggest internal factor, with knowledge/skills transfers (37%) in second place followed by company growth (34%) and budget constraints (33%). The impact of corporate reorganization has been steadily increasing the past two years and is at similar levels to 2002-2005, while the impact of knowledge/skills transfers remains steady for large firms. Mid-size firms indicate promotions/resignations as the largest internal factor (42%) affecting relocations in 2008. Typically second to company growth, this factor last showed primacy in 2002 (47%). Three internal factors impacted small firms nearly equally: company growth (34%), knowledge/skills transfers (33%), and promotions/resignations (32%). The percentage indicating promotions/resignations is similar to the past six years, but the percentage indicating knowledge/skills transfers has significantly increased from 2005-2006 (19% and 18%, respectively).

  • Manufacturing/processing firms are more likely to report decreased production and facility closings as having an impact on relocation in 2008 (14% vs. 6% and 18% vs. 10%), and for-profit service firms are more likely to report expansion into new territories (25% vs. 15%).
  • International firms report the impact of company growth, corporate reorganization, and knowledge/skills transfers at nearly equal levels in 2008 (36%, 36%, and 35%). Regional firms cite promotions/resignations (41%) as their top internal issue, and national firms report promotions/resignations and company growth nearly equally (43% and 41%).
  • Overall, promotions/resignations had a significantly greater impact on regional and national firms in 2008 (41% and 43% vs. 29%), while company growth and the expansion into new territories were more impactful at national and international firms (41% and 36% vs. 19% and 23% and 19% vs. 9%). International firms also felt the closing of facilities (17% vs. 6%) and budget constraints (26% vs. 13%) more keenly than did regional firms and they are more likely to report acquisitions/mergers (27% vs. 3% and 10%), corporate reorganization (36% vs. 19% and 22%), and international expansion (21% vs. 1% and 2%) impacted relocation volumes in 2008 than regional and national firms.
Question 13: Select Internal Factors Impacting Relocation: 1988-2008
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Outsourcing

Slight Uptick, Overall Similar to 2002-2007; Varies by Company Size

Sixty-one percent of companies outsourced relocation services during 2008, up slightly from 2005-2007. This is identical to 2002 and down slightly from 2003-2004, but similar overall to the past six years. Generally, mid-size and large companies continue to outsource a significantly greater variety of relocation services than small companies do, and small firms are still much less likely to outsource relocation services than are mid-size and large firms. A fourth or more of both mid-size and large companies outsource the relocation-related services listed in the survey.

Overall Shifts

  • Close to half (45%) of firms outsourced real estate sales/marketing last year, significantly more than in 2005 and 2007 (36% and 38%).
  • The outsourcing of monitoring household goods shipments is up slightly from 2007 (34% vs. 28%) and significantly higher than in 2002 and 2004-2006 (when roughly a fourth or less of firms did so).
  • Significantly more companies outsourced counseling about company policy than in 2005-2007 (28% vs. one-fifth or less), similar to 2002-2004 (23%, 27% and 24%).
  • Nearly a third (30%) of firms outsourced expense tracking/reimbursement, a significant jump from roughly one-fifth or less in 2005 and 2007.
  • The percentage of firms outsourcing the audit/payment of invoices returns to 2002-2004 levels (25% vs. 24% and 27%) after dropping significantly in 2005 and 2007 (8% and 18%).
  • The only significant differences between large and mid-size firms among individual outsourcing categories are in counseling about company policy, real estate sales/marketing, and real estate purchase (large firms are more likely to outsource these services). For all other outsourced items, mid-size and large firm outsourcing levels appear similar in 2008.

Outsourcing Changes by Company Size

Slightly more mid-size firms outsourced in 2008 than in 2007 (69% vs. 62%) with increases occurring across individual categories. Compared to 2005-2007, these firms increased outsourcing the counseling about company policy, orientation tours, family transportation/accommodation arrangements, household goods carrier contracts, audit/payment of invoices, claims assistance and supplementary services, returning to 2002-2004 levels. Expense tracking/reimbursement and shipment monitoring outsourcing see significant increases over 2005-2006 and moderate gains over 2007.

Similar to the past six years, the majority (84%) of large firms outsourced. Percentages are similar to last year across categories, but some changes of note occurred. The outsourcing of counseling about company policy had dropped in 2005-2007 (38% and 40%) but now returns to 2002-2004 levels (49%). The percentage of firms outsourcing family transportation/accommodation arrangements falls from roughly half in 2006-2007 to 37% in 2008. The outsourcing of the household goods carrier contract remains similar to the past six years (42%) but trends lower than in 2002-2003 (52% and 55%).

Small companies that outsource were just as likely to outsource the contract of a household goods carrier as they were to outsource real estate sales/marketing services (22% vs. 23%), similar to 2007. Overall, outsourcing across categories is similar to the past two years, maintaining increases gained over 2005 or growing slightly (orientation tours is the exception – 8% vs. 9% in 2005).

Additional Insights:

  • International firms are more likely than national or regional firms to outsource relocation services (76% vs. 52% and 36%).
  • The majority of both manufacturing/processing and for-profit service firms outsourced relocation services in 2008 (64% and 61%, respectively). However, manufacturing/processing firms are more likely to have outsourced the arrangement of family transportation and accommodations (40% vs. 27%), tax gross-up assistance (38% vs. 20%) counseling about company policy (36% vs. 20%), the audit and/or payment of invoices (36% vs. 23%), and supplementary services (24% vs. 14%).
  • Across regions of the U.S., outsourcing was similar except for the Northeast, where the percentage was the highest (79% vs. roughly half to two-thirds of firms in other regions). Regionally, Northeastern and Midwestern firms outsource real estate sales/marketing, real estate purchases, household goods carrier contracts, shipment monitoring, expense tracking/reimbursement, tax gross-up assistance and supplementary services more often than firms in most other regions.
Question 24: Outsourcing
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Relocation Reimbursement/Payment

Full Reimbursement and Lump Sum Payments Remain Stable; Partial Reimbursement for New Hires Increases Significantly

After dropping significantly in 2006 and 2007, full reimbursement for transferees or new hires maintains last year's rebound to near 2003-2005 levels (although still trending lower than these historical highs). Additionally, close to half of companies continue to utilize lump sum payments in 2009 for either employee group, similar to 2008 and significantly above 2003-2007. The percentages of firms offering partial reimbursement to transferees and new hires are the highest in seven years.

The majority of firms still offer full reimbursement of moving expenses as an option for transferees, although the percentages of firms offering either lump sum or partial reimbursement continue to trend upwards. Interestingly, the percentage of firms offering partial reimbursement to new hires this year jumps significantly from 2008, surpassing lump sum payments. For new hires, reimbursement methods appear greatly interchangeable. About half of firms offer full, lump sum, or partial reimbursement, revealing a nearly equal probability for any of the three methods to be used. For transferees, full reimbursement is still the most common, but lump sum payments and partial reimbursement continue to gain ground.

  • While the majority (59%) of large firms offer full reimbursement to new hires, roughly half offer lump sum payments and/or partial reimbursement as well.
  • Small firms are the least likely this year to offer lump sum payments to new hires (38% vs. 51% and 47%) or transferees (38% vs. 49%).
  • About half of all size firms offer partial reimbursement to new hires.

Additional Insights:

  • Regional firms are much less likely than national firms to offer lump sum payments to transferees or new hires (33% vs. 54% and 37% vs. 52%). International and national firms show a similar likelihood (45% vs. 54% and 44% vs. 52%, respectively).
  • Most manufacturing/processing firms and for-profit service firms (66% and 61%) offer full reimbursement to transferees. Manufacturing/processing firms are more likely to offer lump sum payments (52%) than partial reimbursement (37%), while for-profit service firms are almost equally likely to offer either (40% and 41%).
  • Manufacturing/processing firms show the least discrimination in reimbursement methods for new hires; close to half or more offer each type (full, lump sum, or partial). Roughly half or more of for-profit service firms offer full or partial reimbursement, while fewer (39%) offer lump sum payments.
  • A majority of firms in every region of the U.S. offers full reimbursement to transferees. For new hires, over half of firms in the Northeast, South, and West/Central regions offer full reimbursement; Midwestern and Southwestern firms are least likely (44% and 35%). Close to half of firms in all regions offer partial reimbursements to new hires.
  • Roughly half of Northeastern and Midwestern firms (48% and 53%) offer lump sum payments to transferees; more than a third of firms in other regions do so. While close to half or more of firms in most regions offer lump sum payments to new hires as well, significantly fewer firms in the South do so (28%).

As in the past six years, the majority of firms, regardless of size, reports that carrier transportation expenses are "paid directly by the company" for either transferees or new hires. However, small firms continue to be more likely than large or mid-size firms to have moving expenses paid by the employee and reimbursed.

  • The majority of both manufacturing/processing and for-profit service firms pay transportation expenses directly for transferees (90% and 87%) and new hires (89% and 77%); however, manufacturing/processing firms are more likely than for-profit service firms to do this for new hires.
  • Regional and national firms are more likely than international firms to require transferees to pay transportation expenses and then reimburse them (28% and 25% vs. 14%). For new hires, regional firms are by far more likely than national or international firms to follow this policy (41% vs. 22% and 17%).
Question 28: Relocation Reimbursement Methods
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Cost Coverage

The majority (90%) of companies reimburses or pays for some relocation costs for transferees or new hires, similar to the past six years. Overall, coverages of most core relocation expenses (i.e., pack all items, move an automobile, unpack all items, etc.) remain similar to last year and some increase slightly. However, the percentage of firms offering to move unlimited weight drops significantly from 2008 (38% vs. 46%); although this remains similar to 2003 – 2007 fewer companies of all sizes cover this item. Also, while slightly greater percentages of mid-size and small firms cover moving an automobile, significantly fewer large firms do so (84% vs. 94%).

Half or more of companies indicate they reimburse/pay to:

  • Pack all items (79%, similar to the past six years except 2006 (71%))
  • Move an automobile (72%, similar to the past six years)
  • Move exercise equipment (56%, similar to the past six years)
  • Unpack all items (51%, similar to the past two years)

Overall, percentages of companies offering "non-core" relocation benefits to transferees or new hires decrease slightly compared to last year, although most remain similar to 2008. The exception is firms that pay to move collections of highly valuable objects, which drops significantly from last year (36% vs. 43%) but remains above 2006-2007 (27%) and close to 2003-2005 levels (30%+). This change is driven primarily by a significant decrease in large firms (37% vs. 61%) offering this coverage.

  • Internationally operating firms are more likely than national or regional firms to offer the following to transferees or new hires:
    - Pack all items (86% vs. 75% and 68%)
    - Move an automobile (83% vs. 65% and 55%)
    - Move a second automobile (56% vs. 39% and 30%)
    - Move pets (43% vs. 25% and 14%)
  • Internationally operating firms are more likely than regional firms to:
    - Move unlimited weight (42% vs. 29%)
    - Offer permanent/extended storage of some possessions (41% vs. 29%)
  • Companies in the Midwest and Northeast are the most likely to reimburse/pay for the packing of all items (88% and 86%), while companies in the South are least likely (70%). Over three-fourths of firms in other regions do so for transferees or new hires.
  • Midwestern and Northeastern firms are more likely to pay for permanent/extended storage than are firms in the Southwest (44% and 40% vs. 21%); just over a third of firms in other regions indicate they do so for transferees or new hires.
  • West/Central firms are the most likely to reimburse/pay for moving a second automobile (57%), while companies in the South are least likely (41%); roughly half of firms in other regions do so for transferees or new hires.
  • Midwestern and Southern firms are the most likely to reimburse/pay for moving recreation and lawn equipment (55% and 51%), while companies in the Northeast are least likely (33%); over 40% of firms in other regions of the country do so for transferees or new hires.

Specialized Assistance for Homeowners/Renters

The majority of firms offers specialized relocation assistance for employees who are homeowners, although small firms remain less likely than mid-size or large firms to offer most types of assistance. Over the past three years, the percentages of firms offering the different types of homeowner-specific assistance have remained mostly similar, and those offering storage and covering loss-on-sale have increased steadily and are significantly greater than in 2007 (59% vs. 50% and 27% vs. 20%, respectively). Compared to last year, the percentages of firms offering each type of homeowner assistance increase slightly overall, except for slight decreases in those offering home-finding trips and duplicate housing assistance. The largest decreases occur for these items at small firms: significantly fewer firms offer duplicate housing assistance compared to 2008 (10% vs. 23%) and the percentage offering home-finding trips falls ten percent from last year (49% vs. 59%).

For homeowners, more than half of firms offer the following to transferees or new hires:

  • Temporary housing allowance (74%)
  • Home-finding trips (68%)
  • Storage (59%)
  • Reimburse/pay for home sale costs (55%)
  • Reimburse/pay for home purchase costs (54%)

The majority of firms offer specialized relocation assistance for employees who are renters, although small firms remain less likely than mid-size or large firms to offer most of the types of assistance listed. Overall, the percentages of firms offering each type of renter-specific assistance stay the same or decrease slightly from last year with two exceptions: more firms offer to reimburse/pay for lease cancellation (60% vs. 55%) and significantly more firms offer to reimburse/pay for apartment search/finder's fees (36% vs. 27%). Historically, renter-specific coverage is similar across categories over the past seven years with two exceptions: significantly more firms offer storage than in 2003, 2005-2006 (51% vs. 41%) and significantly fewer reimburse/pay for hook-up fees than in 2003-2007 (20% vs. 27%, 30% and 31%).

For renters, more than half of firms offer the following to transferees or new hires:

  • Temporary housing allowance (67%)
  • Home-finding trips (61%)
  • Reimburse/pay for lease cancellation (60%)
  • Storage (51%)

Manufacturing/processing firms are more likely than for-profit service firms to offer specialized assistance to homeowners (93% vs. 80%) and to renters (94% vs. 80%). International firms are more likely than regional or national firms to offer homeowner (96% vs. 77%) and renter-specific assistance (96% vs. 77% and 84%).

Question 28: Transferee Reimbursement 2003-2009
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Question 28: New Hire Reimbursement 2003-2009
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Trailing Spouse/Partner Assistance

Employment Assistance Increases, Potential Relationship Between Trailing Spouse Gender Emerges

Half of all firms offer employment assistance to the spouse or partner, more than at anytime in the past six years. While the percentages of mid-size and large firms increase, the largest jump is at small firms (48% versus roughly one-third 2003-2008). Interestingly, the upward trend over the past two years coincides with increasing percentages of male trailing spouses. This potential correlation is especially pronounced at small firms where the percentage of male trailing spouses more than doubled since the 2007 survey (21% vs. 8%) and one out of every three relocations have typically utilized spousal employment assistance since 2005.

  • Large firms are more likely than mid-size or small firms to offer employment assistance to a relocating employee's spouse/partner (61% vs. 44% and 48%).
  • Most small firms that offer employment assistance provide networking assistance (83%); they provide this more often than mid-size or large firms (57% and 39%). Small firms are also more likely than mid-size or large firms to find employment within the company for an employee's spouse/partner (31% vs. 16%).
  • Mid-size and large firms are more likely than small firms to offer resumé preparation assistance (49% and 45% vs. 29%) and outplacement/career services from an outside firm (37% and 49% vs. 14%), while large firms are more likely than small or mid-size firms to offer interviewing skills training (37% vs. 14% and 20%).
  • Employment assistance is utilized in nearly one out of every four relocations overall; however, relocating employees utilize these services nearly twice as often at small firms than large firms on average (31% vs. 16%).

Even with an increase in spouse/partner employment assistance offered over last year, the percentage of firms indicating a spouse's/partner's employment almost always or frequently affects an employee's relocation remains similar to last year (42% vs. 39%). This is significantly lower than the high in 2007 (52%) and comparable to what was reported in 2003-2006 (42% to 44%).

  • Small and mid-size firms (48% and 44%) are more likely than large firms (31%) to indicate the employment status of a spouse or partner often impacts relocations.
Question 34 and 38a: Employment Assistance: Trailing Spouse/Partner
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International Relocation Shifts

Lower Expectations for Short-Term Assignments

Last year, short-term international relocations (less than 12 months in length) increased across companies of all sizes. This year, firms appear to be shifting back to lengths that are more traditional. Among small firms, 21% report short-term assignments are the standard practice, but fewer mid-size or large firms (12% and 9%) do so, similar to 2006-2007.

Overall, while most firms expect short-term international relocations to remain similar to last year, significantly more expect decreases than in the past four years (24% vs. 6%, 11% and 8%), and the percentage expecting increases is about half of what it was in 2005 - 2007 (13% vs. 23%, 22% and 24%).

  • Mid-size and small firms express the greatest expectation for a decline in the use of temporary relocations internationally compared to the past four years (31% vs. 3%-19%).
  • Regarding increases in short-term international assignments, expectations among large firms have been progressively declining since 2005 and are about half of what they were four years ago (19% vs. 40%). Expectations among mid-size firms peaked in 2007 (26%) and drop significantly for 2009 (12%).
  • One of the biggest shifts for small firms is typical assignment duration; while a similar percentage of small firms indicate short-term international relocations are the norm, almost half now say the typical duration is three years or more. This is a shift from 2006-2008, when less than a third reported assignments of this length were standard. The typical international assignment is now longer for small firms than for mid-size or large firms.
  • For-profit service firms are more likely than manufacturing/processing firms to have typical international assignment durations of less than 12 months (21% vs. 5%).

 

International Outsourcing

Overall Level Increases Significantly; More Firms of All Sizes Outsourcing

Significantly more firms outsourced internationally in 2008 than in 2007 (74% vs. 63%) and in 2004 (58%). While similar to 2003 and 2005 – 2006 (70%, 62% and 66%), overall this is the highest percentage in six years. Additionally, increases occur in every outsourcing category compared to 2007, significantly in international shipment monitoring (46% vs. 32%), destination services/orientation tours (43% vs. 31%), counseling about company policy (36% vs. 26%), counseling about the planning/details of international relocation (35% vs. 22%), arrangement of family's transportation (35% vs. 23%), and international real estate services (25% vs. 16%). Overall, the percentages for each service nearly meet or exceed highs over the past five years.

The majority of both mid-size and large firms outsource international relocation services, as in the past five years, but this is the first year a majority (52%) of small firms indicate doing so. This is similar to 2007 (49%), greater than 2006 (38%) and nearly double 2004 and 2005 (28% and 23%). The percentage of mid-size firms outsourcing internationally declined progressively in 2006 and 2007 (64% and 59%), but increased significantly in 2008 (76% vs. 59%), yielding levels similar to 2003 and 2005 (73% and 75%). The percentage of large firms outsourcing internationally is nearly identical to 2003 and 2005-2006 (84% vs. 85%, 83% and 82%) after trending slightly lower in 2004 and 2007 (76% and 77%); more than half of these firms outsourced destination services/orientation tours, securing rental property, international shipment monitoring, household goods carrier contracts, and intercultural and language training.

  • More small firms outsourced international services in 2007-2008 than in the past four years. The percentages outsourcing international shipment monitoring, the management of international relocation programs, intercultural and language training, and counseling about company policy are the highest in six years; percentages for visa and immigration services, arrangement of temporary accommodations for families, and repatriation services also increase. However, compared to 2006, moderate decreases in outsourcing international relocation planning/details counseling (10% vs. 18%), international real estate services (7% vs. 13%), and securing rental property (14% vs. 21%), occur overall.
  • While the percentage of small firms outsourcing international real estate services falls in 2008, mid-size and large firms are more likely to have outsourced these services than in 2007 (29% vs. 17% and 32% vs. 17%, respectively). Among all firms, the percentage outsourcing real estate services increases significantly (25% vs. 16%), similar to 2003-2006 (26%, 25%, and 24%).
  • Outsourcing of international relocation services among mid-size firms increases over 2007, nearly meeting or exceeding highs over the past five years in each category, except for securing rental property and international relocation program management. Outsourcing for these two services increases over 2007, but falls short of the past five-year highs (40% vs. 47% and 31% vs. 40%, respectively).
  • Overall, outsourcing of international relocation services among large firms increases over 2007, nearly meeting or exceeding highs over the past five years in each category, except for visa and immigration services and temporary family accommodation arrangements (two new additions to the survey last year). The percentages of large firms outsourcing these services remain similar to 2007 but decrease slightly from last year (47% vs. 54% and 41% vs. 52%, respectively).
  • While manufacturing/processing and for-profit service firms share similar likelihoods of outsourcing most international relocation services, for-profit service firms are more likely to outsource international shipment monitoring (58% vs. 42%) and relocation planning/details counseling (51% vs. 33%).
  • This year, a fourth or more of companies who relocate employees internationally outsource the international relocation services listed in this survey.

Among companies that outsourced relocation services domestically in 2008, the percentage that did so internationally is the highest in six years (85%) similar to 2003, 2005-2007 (82%, 79% and 80%) and significantly greater than in 2004 (70%). This year, large and mid-size firms share similar likelihoods to outsource internationally and to outsource each service with three exceptions: large firms remain more likely to outsource securing rental property, destination services/orientation tours, and intercultural and language training. Both mid-size and large firms this year are more likely to outsource international relocation services than small firms, as well as a greater number and variety of these services. However, firms of all sizes share a similar likelihood to outsource visa and immigration services.

 

International vs. Domestic Policy

Additional Considerations Increase; International Employment Assistance Stable

Most firms (83%) report differences between domestic and international relocation policies, similar to the past six years. Overall, the amount of considerations recovers after declining last year, as nearly every policy consideration category experiences an increase in the number of firms offering it to internationally relocating employees. Additionally, the percentages of firms offering higher relocation and rental housing allowances are at the highest levels in seven years. However, less than a third (31%) of firms offer additional leave time, similar to last year (30%) and significantly less than about half of firms offering this consideration from 2003-2007.

  • While percentages for most policy considerations among large firms are nearly the same or increase slightly, those offering additional leave time continues to decline (25% vs. 40% last year) and significantly below 2003 – 2007 (60%+).
  • After dropping considerably last year, additional considerations at mid-size firms for internationally relocating employees bounce back close to historical highs from the past six years. The largest increases are in: additional tax considerations (63% vs. 42%), higher relocation allowances (54% vs. 36%), increased allowances for permanent storage (51% vs. 34%), allowances for children to attend certain schools (51% vs. 36%), higher rental housing allowances (49% vs. 32%), intercultural and language training (49% vs. 32%), and additional leave time (37% vs. 14%). Overall, the percentages of mid-size firms offering higher relocation allowances, extended per diem charges, and higher rental housing allowances are the highest in seven years.
  • While mid-size and large firms see policy considerations increase or stay nearly the same compared to last year, small firms see slight decreases across categories, except for allowances for children to attend certain schools (21% vs. 13%), intercultural and language training (36% vs. 28%), and extended per diem charges (24% vs. 15%). However, the percentages of small firms offering individual considerations remain similar to the past six years, except for allowances for children to attend certain schools and increased permanent storage allowances, which are significantly lower than historical highs (21% vs. 44% and 19% vs. 40%).
  • Large firms remain more likely than small firms to offer additional considerations overall, and mid-size and large firms share similar likelihoods for offering most international policy considerations. However, large firms are more likely than mid-size firms to offer intercultural and language training (69% vs. 49%). Overall, both mid-size and large firms offer a larger number and variety of policy considerations to internationally relocating employees than small firms.
  • The majorities of manufacturing/processing and for-profit service firms offer additional policy considerations for internationally relocating employees (85% and 84%, respectively); however, manufacturing/processing firms are more likely to offer higher relocation allowances (52% vs. 33%), while for-profit service firms are more likely to offer extended per diem charges (37% vs. 23%).

Forty-four percent of companies offer employment assistance to spouses or partners relocating internationally, similar to the past two years (42% and 46%) and maintaining increases established over 2003 - 2006 (27%, 22%, 24% and 33%, respectively). More small firms offer this assistance than did last year (45% vs. 26%), the highest percentage in the past seven years. While the percentage of mid-size firms is similar to last year (38% vs. 41%), it is down slightly from the high in 2007 (46%), but remains substantially above 2003-2006 when roughly one-fourth or fewer offered this assistance. Half of large firms offer this assistance, similar to 2006-2008 (45%, 47%, and 55%) and significantly more than in 2003-2005 (roughly a third or less). Small firms are more likely than mid-size or large firms to offer networking assistance (38% vs. 22% and 13%), while about one-fifth of all size firms pay for outplacement/career services or a work visa.

Question 44c:  International Duration
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