HR Bullish About Relocation

Plans for recruiting and relocation are rebounding, according to the results of a new survey. And most HR professionals do not see significant obstacles to relocation in today's economic environment, with only six percent of HR professionals saying they believe that today's workforce is not willing to relocate, and most believe it is "highly mobile" or "somewhat mobile."

Monday, July 2, 2012
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Corporate recruiting is moving into high gear, with two-thirds of HR professionals reporting that they have "extensive" or "moderate" plans for hiring in 2012, according to the 2012 Allied Workforce Mobility Survey.

Larger companies -- those with more than 10,000 employees -- are more bullish yet, with 80 percent planning for "extensive" or "moderate" recruiting. Approximately 500 HR professionals took part this spring in the survey, which is sponsored by Allied Van Lines.

Recruiting and relocation go hand in hand, especially for larger companies, which are inclined to cast the net more widely in their searches. We had expected to see some apprehension about relocation, given the soft housing market in the U.S. and troubled economies worldwide.

In fact, HR professionals expressed concern about the economy, but not in relation to relocation. About relocation, they were largely upbeat, confident of their ability to relocate the best talent, given the right incentives (salary, career advancement and relocation assistance).

The bottom line is that most HR professionals do not see significant obstacles to relocation in today's economic environment. Only six percent of HR professionals believe that today's workforce is not willing to relocate, and most believe it is "highly mobile" or "somewhat mobile." Fifty-nine percent reported that the current economic context has had "no impact" on their ability to recruit and hire.

Whether a candidate accepts an offer or not depends a lot on the relocation package, according to survey participants. Fifty-seven percent of HR professionals regard the quality of relocation packages as "extremely important" or "important." And, in an improving U.S. economy (with a lagging housing market), relocation packages will become even more critical.

And yet, interestingly, more than one-third of the survey respondents reported that their companies did not have a formal relocation program and another 45 percent reported that their programs are only "somewhat successful" or "unsuccessful."

Among companies with formal relocation packages, the most common benefits are moving expenses and temporary living costs, cited by 67 percent and 49 percent of HR professionals, respectively.

According to the survey, two factors are most likely to increase a candidate's willingness to relocate: higher salary (reported by 82 percent of HR professionals) and career advancement (reported by 79 percent).

But these benefits are not always enough. The top three variables that limit or restrict a candidate's willingness to relocate are a spousal employment situation, children's plans/schools and selling a home/mortgage. Unfortunately, not many companies address these issues, even among those rated "highly successful" in relocation and recruiting. For example:

* While 80 percent of respondents report that a spousal employment situation is a probable obstacle to a candidate's relocation, only 2 percent of companies cover spousal unemployment costs in any form.

* While 69 percent of respondents say that selling a home/mortgage restricts relocation, only 16 percent of companies offer reimbursement on old-home losses.

* While 72 percent of respondents say children's plans/schools restrict relocation, only 39 percent of companies offer information on the area and schools.

Taken as a whole, the survey suggests many opportunities for companies to become more competitive heading into a challenging recruiting period.

Many smaller companies may sell themselves short. Only 38 percent search nationally for candidates and 6 percent internationally. By comparison, 57 percent of mega-sized companies (more than 10,000 employees) recruit nationally and 25 percent internationally.

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In fact, smaller companies can compete effectively, both nationally and internationally, if they are willing to put the resources and structure behind the effort.

Larger companies are more likely to have "highly successful" relocation companies, but there are best-in-class relocation programs at smaller companies, too. About 20 percent of midsize and large companies (between 200 and 10,000 employees) and 10 percent of small companies (less than 200 employees) are best in class at relocation.

The average value of relocation packages at most companies are comparable, but at mega-sized firms, relocation packages are three times more valuable.

* Small companies: $12,073

* Midsize companies: $9,606

* Large companies: $14,007

* Mega companies: $41,052

If you're an HR professional at a smaller company and want a candidate to relocate, you may have to offer what the biggest companies will. The average value of a "gold-plated" relocation package is $65,333, according to the survey.

There are also plenty of low-cost ways to create differentiation. Since so few companies are doing anything to address spousal employment, old-home losses and issues related to schooling, even a modest effort can make a difference.

* Provide a report card on the local school system or summary of private school options in the area;

* Provide the spouse with a brief tour of the city or an informal overview of local companies in his or her field; and

* Provide some financial counseling on what to expect when selling an old home and discuss options.

In addition, consider making your relocation package more like a package. Recruits have diverse needs, yet most companies do not offer diverse options tailored to specific types of recruits (e.g., married with children versus single). Seventy-two percent of programs offer only four of 10 possible relocation benefits listed in the survey. By contrast, best-in-class companies draw on a broader array of incentives.

Jeff Knapton is a vice president at Allied Van Lines.

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