The changing face of corporate relocation - includes related article on outsourcing

HR Magazine, March, 1998 by H. Cris Collie

In response to competitive and demographic changes, more companies are outsourcing their relocation programs and are meeting a wider range of employee work-life needs.

Emily is 32 and single, and she's moving to England next month. Ben's due in Dallas in two weeks, where his wife, two children and elderly mother are already living. Charlie and his wife have decided to live apart for a few months until she graduates from college and can join him at his new high-tech job in California. Emily, Ben and Charlie represent a new breed of corporate transferee, and companies are diligently working to address their special needs.

Traditionally, the typical transferee is male, about 38 years old, married with dependent children and a salary just under $60,000. But while the profile of the "average" relocating employee differs little from the traditional one, the population of transferees is becoming much more diverse. Among the factors that affect relocation are changing demographics, which include more female transferees (17 percent of the transferring workforce), spouse and partner employment issues, child care concerns, the need to assist the transferee's aging parent, a demand for technology-savvy new hires, and a general trend toward quality-of-life issues having more influence on the employee's decision to relocate.

The United States has the most mobile society in the world. Each year nearly one-fifth of the population relocates, according to the Census Bureau. Since 1964, the Employee Relocation Council (ERC), a professional membership organization concerned with global mobility, has been studying issues and trends that affect corporate relocation. In a recent survey, ERC member corporations reported that they were transferring about 300,000 employees a year, and their short-term predictions indicated that they expected their transfer activity to continue at a steady pace or to increase.

For most companies, employee mobility is essential to an effective workforce. Relocations are less discretionary and far more strategic. Companies now report that only about 53 percent of their relocations are related to promotions, compared to 67 percent in 1988. In the past, employees were moved around to different office locations to give them varied experience and to groom them for management positions.

A SHIFT TO WORK-LIFE ASSISTANCE

Bare-bones policies have given way to those that solidly address the financial and logistical needs of transferees and their families, as well as some of the work-life issues associated with moving. The standard domestic relocation policy usually includes the following types of assistance: shipping of household goods (shipping, packing, unpacking and storage); funds for temporary living quarters, house hunting trips (often, two or more trips are offered and usually include the spouse and sometimes dependent children); closing costs for the purchase of the home at the destination location; a miscellaneous expense allowance (to cover incidental expenses related to the move, such as auto registration and appliance hookups); and some form of real estate sales assistance.

Recently, companies have been addressing the special needs of transferring employees in their formal policies, rather than providing assistance only on a case-by-case basis when requested. Companies also are providing assistance to ease the relocation of the single employee who may not have a partner to handle some of the personal tasks that accompany a move. The needs of spouses who are leaving their jobs are both recognized and addressed. About one-half of companies offer spouses employment assistance, either as part of a formal policy or on a case-by-case basis. Most often, the company picks up the tab for an outside job counseling or placement agency, but the assistance might include resume printing costs, job contacts at other corporations, reimbursement for state licenses and exams, or the cost of additional trips to the new location.

Companies also are responding to a larger number of cohabitating couples in the workplace. Some companies now extend relocation assistance to the partners of unmarried transferring employees. One reason is to ensure the equitable treatment of the employees they're transferring and to avoid disrupting the family lifestyle and potentially reducing the transferring employee's productivity at the new location. An important criterion for extending relocation assistance to partners seems to be whether the partner is a member of the transferee's household or is residing at the same location before the move. Nearly 15 percent of companies provide formal relocation assistance to partners - in 1988, only 5 percent of companies had formal policies. Another 16 percent usually will if requested, although no formal policy exists.

With the baby boom generation aging, more transferring employees now face the challenge of moving both dependent children and dependent parents. To ease one element of moving with children, some companies cover the cost of assistance in finding schools, either by outsourcing to a commercial service provider, providing a lump sum for school-finding assistance or linking employees to previously relocated families. Companies with elder-care policies most frequently will provide a list of elder-care facilities or move the elderly relative with the family, if the relative lived with the family at the old location.