Over the last few years, as companies have developed and implemented a wider range of alternative policy approaches within their global mobility programs, long-term assignments (LTAs) have seen a decrease in their rate of growth.
It's been enough of a decrease to prompt some to ask the question, "Is this the end of the long-term assignment?" This ECA article from April 2018 points out that the use of short-term assignments, commuter assignments and permanent transfers were on the rise, leaving the author to ponder the fate of the LTA.
Then late in 2019, AIRINC published its 2019 Long-Term Assignment Benchmark and recently revisited it to present three surprising stats to consider in light of COVID-19. The reality is that cost, while always a big concern for companies, has reasserted itself as the top concern in the midst of an economy that has slowed down due to the pandemic. For many companies, long-term assignments are just too expensive right now.
As for expats on assignment, the pandemic has created various situations that have driven them to return home. According to this Forbes article, "Expat, Broke, And Remote: Why Foreign Workers Are Coming Home," Ireland has seen 29,000 citizens return home — the highest number in 13 years. Additionally, the article notes that "New Zealanders were the largest group returning home, which is hardly surprising given the country has been one of the most successful in fending off Covid-19. Others have come home to the U.K. and U.S. from postings in China, Singapore, Hong Kong and the UAE."
And more often then not, expats are being replaced with locals. Some of the reasons that companies are replacing expatriates with local workers are:
- they are often cheaper
- they speak the language
- they understand the culture
- and they stay in jobs longer
As we had already been seeing a reduction in the volume of long-term expatriate assignments, one has to wonder whether COVID-19 has "stuck a fork" in the long-term assignment.
That recruitment has slowed rapidly, she says: "Multinational firms at the moment have massive hiring freezes on. They have changed the packages for expats so what used to be the fabulous, 'We'll relocate you, we'll pay your housing, we'll give you a car allowance and we'll pay your schooling plus a salary on top of that.' Those days are long gone."