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Factors Impacting Relocation

Talent Needs Continue to Drive Relocation

For the past nine years, the key external factor affecting relocation volumes was the lack of qualified local talent. Recruiting the right people with the right skill sets is crucial for company growth and operations, so relocation continues to function as a pivotal talent engine. The impact of available talent remains markedly above the level reported in 2009 (31%) and far above much lower levels seen before 1996. Regardless of company size, talent shortfalls remain a key driver of relocation volumes overall.

  • The top factor affecting relocation last year was a lack of local talent.
  • As a relocation driver, company growth falls notably below the previous post-recession recovery levels and within the recessionary levels of 2008-2009 (24%-33%). However, more firms (39%) report volumes are affected by expansion (facility, new territories, or international), indicating efforts to expand the company footprint are a larger driver than overall growth.
  • Even before the COVID-19 pandemic, potential challenges were already emerging: 28% of firms reported economic conditions as a factor in relocation, similar to 2018 (28%) and up from 2017 (21%). The impact of budget constraints on volumes also increased for a second year (20% & 16% (2018) vs. 13%). Both factors remain within historic ranges for recovery, after falling to historic lows in 2017, but are elevated for a second straight year. If these were signs of economic headwinds beginning to affect relocation prior to the pandemic, the fallout from both is likely to be very challenging for the industry.

While the top factor impacting relocations continues to vary by company size, competition growth (international or domestic), expansion efforts, and lack of local talent notably affected firms of all sizes in 2019.

  • Large firms were most affected by organizational changes (acquisitions/mergers or corporate reorganization/restructuring, 45%), followed by expansion efforts (40%), competition growth (40%), and local talent shortages (39%).
  • For mid-size firms, the biggest impact on relocation resulted from competition growth (international or domestic, 46%), with expansion efforts (43%) and a lack of local talent (43%) in second place.
  • Small firms’ biggest issue was lack of local talent (42%), with expansion efforts (36%), competition growth (35%) and company growth (34%) closely following.

Political/regulatory environments (domestic or international) as a notable impact on relocation volumes continue its trend of rising over the last six years. For a second year, the highest percentage of firms are reporting political and regulatory issues as having a significant influence. Political and regulatory issues including visa/immigration restrictions, trade bloc treaty changes, Brexit concerns, and others appear to be increasingly affecting the numbers of relocations being performed by companies.

Question 11-1
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Question 11-2
External factors having the most significant impact on the number of employee relocations
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Question 12-1
Internal conditions having the most significant impact on the number of employee relocations
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Question 12-2
Internal conditions having the most significant impact on the number of employee relocations
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Looming Uncertainty: Brexit










The additional wildcard in the mix of relocation this year, aside from COVID-19, is the exit of Great Britain from the European Union. Political negotiations continue, and there is a sense of unknowability about the ultimate fallouts.

One-fourth of firms that relocate employees internationally are vastly uncertain of Brexit’s impact on relocation this year, both within the United Kingdom and the Europe/Middle East/Africa (EMEA) trade bloc. The consensus is that relocation volumes, administration complexity, and costs in the U.K. will either increase or be unchanged, rather than decrease, while recruiting difficulty and policy changes are likely to stay the same or see increases as well. The projections for the EMEA region are similar; roughly one-third of companies expect relocation volumes and costs to increase in response to Brexit, as well as administration complexity, policy changes and recruiting difficulty, while around one-third feel things will stay similar to current conditions for each aspect listed.


51% of mid-size firms believe Brexit will increase administration complexity in the U.K., compared to fewer small (42%) or large (37%) firms.


In the United Kingdom

  • Mid-size firms are the most likely to believe relocation volumes (47%), administration complexity (51%) and recruiting difficulty will increase (38%) compared to smaller and larger firms.
  • Large firms are less likely to anticipate cost increases (35%), more policy changes (22%), or increased recruiting difficulty (25%) compared to smaller firms.

In the EMEA trade bloc

  • Mid-size firms are the most likely to believe relocation volumes (42%), administration complexity (42%), costs (51%), and policy changes (41%) will increase compared to smaller and larger firms.
  • Large firms are least likely to anticipate cost increases (26%) or more difficulty in recruiting (28%) compared to smaller firms.

Comparing U.K./EMEA impact

  • Overall, small firms indicate they expect increases across each aspect of relocation listed in the United Kingdom more often than in the EMEA area, except for recruiting difficulty (42% vs. 33%).
  • Both large and mid-size firms have similar relocation impact expectations from Brexit across both regions; the exceptions are greater expectations among mid-size firms for increased administration complexity in the U.K. than EMEA (51% vs. 42%) and more large companies expecting increased costs in the U.K. than EMEA (35% vs. 26%).
 
Question 15-1
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Question 15-2
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Question 15-5
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Question 15-6
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Question 15-7
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Question 15-8
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Question 15-9
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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Question 15-10
Projected Impact of United Kingdom’s exit (Brexit) from the European Union
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