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    Corporate Relocation Projections Optimistic as Firms Navigate Tax Reform Changes and Continue to Incentivize the Process

    EVANSVILLE, Ind. (April 24, 2018) —According to one of the nation’s leading movers, Atlas® Van Lines, 2017 was another positive year for the relocation industry, with roughly nine out of 10 organizations indicating both employee relocation volumes and budgets either held steady or increased. Atlas’ annual Corporate Relocation Survey captures comprehensive relocation policy data from respondents operating in North American companies and managing relocation as part of their job function.
     
    Relocation projections for 2018 are similarly optimistic for large (5,000+ salaried employees) and mid-size firms (500-4,999 salaried employees), but far fewer small firms (499 salaried employees or less) expect increased volumes or budgets for 2018. With the changes needed to adapt to tax reform and increasing costs across the industry, it appears the firms juggling greater numbers of relocations are projecting budgetary adjustments for the coming year. Additionally, the expectation for increased international relocation has dropped markedly compared to last year (38 percent vs. 49 percent), reflecting a bit of international instability.
     
    This year, 435 corporate relocation professionals completed Atlas Van Lines’ online survey. Nearly all respondents (93 percent) work in human resources/personnel or relocation/mobility service departments, and 47 percent work for international firms. Each respondent has responsibility for relocation and is employed by a company that has either relocated employees during the past two years or plans to relocate employees this year.
     
    Below are additional trends spotted in this year’s Corporate Relocation Survey.
     
    Tax Reform
    A key issue emerged in December 2017 with the passing of the U.S. Tax Cuts and Jobs Act, as the legislation eliminates the moving-expenses deduction for the next eight years. This year’s survey incorporated additional questions to assess the potential impact of this bill and found that half of organizations expect the legislation to increase relocation costs, both in 2018 and over the next eight years. Far more mid-size and large firms feel this way when looking to 2018 (53 percent and 68 percent) compared to small firms (31 percent), but half or more firms across company size expect increased costs between 2019-2025.
     
    The majority of organizations, regardless of size, have plans to implement policy changes in response to the tax law. Understandably, mid-size and large firms are more likely to have plans in place than are small firms (79 percent and 87 percent vs. 58 percent). Among organizations making policy changes in 2018 in response to U.S. tax reform, the survey found the following:

    • The most popular policy adjustment across organization size is to gross-up taxable relocation benefits, with large firms being the most likely make this policy change.
    • Around a third of firms across all sizes plan to expand the use of lump sums.
    • Roughly a third or more of mid-size and large firms plan to streamline relocation processes to reduce costs and/or to restructure relocation policy/policy tiers, compared to around a fourth of small firms.
    • Small firms are more likely than larger firms to plan to withhold on relocation benefits.
    Family Needs Impacting Relocation Declination
    For the past five years, family issues have ranked as the leading reason for employees to decline relocation, with spouse/partner employment steady as the second reason over the same time period. Combine this with the progressive decline of the impact of housing and mortgage concerns, and it definitely paints a picture of the dual-income household with family commitments as the key issues why employees decline to take a relocation offer in their careers.
     
    To further cement this as a key challenge for firms seeking to relocate employees, essentially six out of 10 firms continue to indicate spousal/partner employment frequently impacts employee relocations for the fourth year in a row. Firms continue to try and mitigate this issue, with the survey showing 59 percent of firms offering employment assistance to spouses/partners overall, and 76 percent offering the service when relocating an employee internationally.
     
    Incentivizing Relocation
    For the past four years, 86 percent of firms stated they offer non-standard incentives or exceptions to encourage employees to relocate. Extended temporary housing benefits, relocation bonuses, and cost-of-living adjustments (COLAs) in salary at the new location continue to be the most popular ones offered.  The vast majority of firms (82 percent), across company size, also indicated they are currently using fixed/flex benefits in their relocation programs. The most popular methods are considering certain relocation benefits as fixed costs covered for moves, while other firms are offering employees options for how they use their relocation amounts in order to tailor the assistance needed on a more individual level. 
     
    With all the bending and flexing to incentivize relocations and creativity in implementation of relocation form, cost containment efforts continue to be top of mind, as the vast majority of firms across company size over the past four years are making specific efforts to control costs. Using lump sums and capping relocation benefit amounts are the top two forms used over the past two years overall. However, there is immense variety in efforts, especially among large firms which utilize reviewing/renegotiating supplier contracts (30 percent), limiting miscellaneous expense allowances (28 percent), offering short-term/extended travel/commuter arrangements (27 percent), or restructuring policy tiers/eligibility for benefits (24 percent) nearly as often as the top two methods overall.
     
    For this year’s complete survey results, visit the Atlas Van Lines Corporate Relocation Survey results online at www.atlasvanlines.com/Corporate-Relocation/Survey. A PDF booklet of key findings, charts, and the complete survey is also available for download here.
     
    About Atlas® Van Lines
    Atlas® Van Lines, a national moving company, is the largest subsidiary of Atlas World Group, an Evansville, Indiana-based company. Atlas World Group companies employ approximately 700 people throughout North America. Nearly 500 Atlas interstate moving agents in the United States and Canada specialize in corporate relocation, household moving services and in the specialized transportation of high-value items such as electronics, fine art, store fixtures and furniture. For more information, visit http://www.atlasvanlines.com.

 

Media Contacts:
Lauren Crays,
Atlas Van Lines, Inc.
800.638.9797, ext. 2213
laucray@atlasworldgroup.com

 


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