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The global employee relocation management market — valued at $29 billion in 2017 — was set to grow at 3 to 4 percent through 2021 and hit the $32B mark. As with the majority of industries, however, Covid is having an impact on the frequency of movers. And yet, at Perchpeek, we are currently busier than ever and we believe that the benefits of supporting employee relocation are becoming clearer than ever before in the wake of the virus.
Now, relocations aren't always cheap (although they can be)... so why are they becoming such a mainstream trend?
Well, it's becoming so because: Relocations work for both employees and employers.
At PerchPeek, where we help move 1000s of employees and their families a year, we routinely see the same factors driving them. So let's see what these are, and how you, as an employer, can make the most of them.
A Disney Story - International Learnings and Sharing
Disney Land Paris, Image from Sortir a Paris
Back in 1993, Disney posted one of its Vice Presidents. Stephen Burke. to France. During his time in France, Burke realized that Disney's global no-alcohol policy was killing business.
He realized that a "glass of wine with lunch was as French as a cheeseburger was American."
When he got back to HQ, he pushed Disney's top management to make wine available at their French park. He also worked on strengthening the company's tour operators' channel to include complete vacation packages, another key issue he had identified while in France.
And the results? Profits the French park had never seen the likes of!
This is a great example of how the movement of staff internationally can allow them to take very new perspectives of how a company can be run, and expand the mindset of both the mover and the company. Not only did the French business benefit from an authoritative review of their operation, but the American side of the business learnt a great deal about operating through alternative methods.
Reflecting on his stay in France, Stephen Burke said: "The assignment to EuroDisney caused me to challenge long-held assumptions that were based on my experiences and career at Disney. After living in France, I came to look at the world quite differently."
For companies, this is one of the top reasons for sending employees overseas (especially those in strategic roles): to develop their leadership skills.
A key role abroad doesn't just help employees develop a global perspective and crucial problem-solving skills but also helps them build a wide professional network (one they can tap into when they are senior management).
Candidates also find relocation to be "an effective way to move up the corporate ladder," a recent study found with 82% of the millennial respondents saying so.
Actively assessing relocation options for your employees who you see playing key roles in meeting your growth goals can be an effective means of keeping your staff energised and growing as leaders, while also making them feel appreciated and invested in.
Redistributing your staff is not only about developing the best of the best for leadership roles; relocations can sometimes help you retain your top performers too. After all, how many thousands of employees have asked to live and work remotely with offices being closed due to Coronavirus?
The drive for something new, something different, is very strong in a world where social media makes people envisage international travel as a key allure to making lifestyle adjustments. In addition, in a hierarchical structure, there is often a lack of opportunities for your talent to be promoted. This can lead to friction and disillusion where there is no headroom for a person’s career growth. As soon as they see this being the case - their eyes will wander.
At any point, about 26% of your employees might be actively looking for a new job. And about 39% might be open to offers (though not actively searching).
The greatest reason for people moving roles is a lack of opportunities. If you take this into account, there is a very strong case to develop your international mobility strategy. Moving your more skilled and experienced employees (the ones that are in need of a new challenge or promotion) overseas in new roles, can kill two birds with one stone - a vacancy and an unsettled employee.
By conducting regular employee experience interviews and surveys, you can understand how your employees are feeling in their current roles. If you discover someone who is ready for a "manager role" — a vacancy that's available in an overseas office — see if you can make the offer.
If a company were to relocate a well-suited Indian colleague to its US office for a project, it would ensure that its US office benefited from the expertise of a talented employee without having to pay as much as it would need to hire native help.
But for the employee, this would still translate to a higher package.
This is another reason why both employees and employers can benefit from relocations. As the cost of relocating people diminishes, such international moves as the above become a more economical way of doing business.
International arbitrage can be applied to human resources as costs to relocate diminish. Image from: Business Line
To make sure you open up this route to reducing employee-hiring costs, explore modern relocation solutions, such as those offered online instead of returning to the old-school relocation agencies. Look at how you can replace "legacy" ways of relocating with the latest solutions. Where large package deals sold by agencies are often chosen for their “personal” feel, in reality they are often excessively expensive and anything but “personal”. Review your options online to secure more cost-effective insurance, cheaper housing and everything in between.
Lower barriers to expansion
From launching sales in a new market, to regulatory compliance to accessing budget-friendly office spaces, setting up offices in foreign countries isn't as challenging today as it used to be.
The opportunity companies and employees see in relocations coupled with the following things make relocations even more mainstream:
The availability of cheaper and more employee-friendly housing. One of the biggest challenges in relocations — housing — is a lot easier and cheaper than it used to be. Previously, large temporary housing contracts and heavy relocation agency fees added to the financial challenge of moving talent to foreign markets. However, on average Perchpeek are saving employers over $10k per 6 month assignment making the housing element of the relocation process much shorter, sweeter and a lot cheaper than ever before. We're the specialists in this part - check out Perchpeek.com for more info.
International work permits and visas are getting easier to secure (minus a few well known exceptions!). Many countries like New Zealand, Australia, Canada, Singapore, Ireland, The Netherlands, Germany among others offer progressively easier visa programs. If you happen to have offices here, securing work visas for your employees should be somewhat easier for you. The application process, in general, too, is now simpler than before.
International work visas are becoming more easily accessed in developed countries. Image from Unsplash.com
Cultural assimilation, too, is easier than it was 20 years ago. From the acceptance of English as the global business tongue, to language learning apps that give access to tutors (live) to solutions that make the world (at least, seem like) a smaller place, many factors help employees feel at home in their newer places quickly.
Leveraging these factors needs you to take the plunge with the latest tech. So explore how tech can help you here.
Openness of employees to travel.
One final reason driving the employee relocation market is the employees' openness to relocating.
From advancing to leadership roles to simply wanting higher packages and building a better future for their families, in 2020 there are many reasons that motivate employees to relocate.
In a survey by Mercer, career development topped the reasons for relocating for millennials with the desire to experience new countries and cultures ranking second:
The openness for relocating to new countries also comes from the benefits employees envisage for themselves or their family in the newer place. In a survey of American millennials, a whopping 38 percent of the respondents said they would relocate to another country if it came with better parental leave benefits.
Sometimes, it can also just be the thrill of starting life at a new place. Like it was for Alycia Byrne, who got a relocation proposal for Florida and set out on her 1,300+-mile career journey. "Sunny beaches and adventure flashed before my eyes. I could almost feel the sunshine on my face and my toes in the sand."
Clearly, there is a drive to relocate — from short-term assignments through to permanent moves..
To make the most of this, make sure that you ask the candidates you interview — especially for positions you could relocate at some point — about their thoughts on relocation. This is important because the attitude of an employee plays a key role in ensuring relocation success.
Wrapping it up…
To use relocations as a tool to help your company grow and lead, you need to use it strategically. Right from identifying the talent to relocate to making the relocation one where they strike a happy work-life balance (so the relocations are actually successful), there are many aspects to consider. All this definitely takes effort but promises major rewards down the line.
A good starting point could be to simply review how you're doing on the five factors from above — and going from there.
Your evaluation might reveal that you need to access relocation options more often for your employees or modernize your relocation process by replacing traditional options with the more disruptive operators. Either way, we hope the above shows how international growth, interaction and assimilation are rapidly becoming easier, and it could play an essential part in your human resources strategy...
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