ICYMI: Global volatility and its impact on your mobility program

Since our last ICYMI post 2 weeks ago, there have been a number of things happening globally that are likely to affect global mobility programs. Let's take a look:

Movement of Household Goods:

• Ocean shipments: After 2 years of port congestion, container shortages, high prices and long waits, per CNBC, U.S. shippers are seeing a 20% drop in ocean freight orders. Ocean carriers are canceling as much as 50% of sailings to rebalance vessel capacity to demand. Freight prices on one key route from Asia to the West Coast are now down more than 80% from last year. While that may all be true, the ongoing threat of labor action among rail and port workers in some regions, port congestion in Europe, and weather-related schedule disruptions will likely lead to more canceled sailings and port omissions, partially offsetting some of the rate decreases out of Asia Pacific. Per our friends at Interconex, "we could start to see relief with international shipping prices as demand is starting to wane. Both air and sea cargo operators have low expectations for the holiday shipping season, which is already underway." Ultimately, demand for containers is falling and so are their rates.
• Rail strikes (again): We recently posted about the potential impacts of the possible rail strikes but a temporary agreement moved the crisis out to at least November 19th. Last week a major union of railroad workers rejected the temporary agreement, with the biggest reason being the lack of paid sick time. There are a total of 12 railroad unions that together represent about 115,000 employees. Four of the 12 unions have approved their agreements with the freight railroads. All 12 must ratify their contracts to avert a strike. A strike would likely shut down 30% of the country's freight according to this article in USA Today. Most agree that it would cause supply-chain disruption and a holiday season economic disaster. Time states that "a union strike could cost the U.S. economy up to $2 billion per day, according to an estimate from the Association of American Railroads. Roughly 40% of the nation’s long-distance trade is moved by rail—more than any form of transportation—and a union strike could stop more than 7,000 trains from operating."

Travel impacts:

• China: Lockdown worries are returning to Shanghai as COVID cases in China have climbed to their highest levels since August. New cases are spiking across mainland China, prompting many local authorities to restrict public movement. Cases tripled during a weeklong holiday (National Day "Golden Week"), ahead of a major Communist Party meeting in Beijing this week. Two Shanghai districts announced closures of cinemas and other entertainment venues last week.
• Taiwan: CIBT and Newland Chase note that "The government of Taiwan announced they are dropping their remaining COVID entry requirements. During September Taiwan has been reintroducing its visa waiver program, which allows visa-free entry for citizens of more than 60 countries, including the United States, United Kingdom, and Australia. As of September 29, citizens of the remaining countries which were part of the pre-COVID visa waiver program, including Japan, South Korea, and Singapore, will no longer need to apply for visas before traveling to Taiwan."
• Japan: From PBS.org, "A daily limit of 50,000 arrivals is gone. Airlines have added flights in response to the full re-opening of borders. Visa-free travel is back for short-term business visits and tourism from more than 60 countries." So travel into and within Japan is picking up dramatically.
• Russian "hacktivist" group: Last week, at least 13 U.S. air travel websites, including those for Hartsfield-Jackson Atlanta International Airport and Los Angeles International Airport — two of the busiest airports in the country — were inaccessible Monday morning after a Russian hacker group (Killnet) named them as targets for cyberattacks. 
• Belarus: Per Crisis24, the Polish Ministry of Foreign Affairs issued a travel advisory, as of Oct. 11, urging Polish citizens not to travel to Belarus, and those in that country to depart the country with available commercial or private means.
• UK: Covid-19 infection rates rose in Britain, Wales and Northern Ireland last week. In England that amounts to 1.74 million people and is a 31% increase from the previous week.
• Italy: Multiple unions, including those representing air traffic controllers, are set to strike nationwide in Italy on Oct. 21.
• Germany: The country has also seen a rise in Covid-19 cases and the German health minister is urging increased measures of prevention, like wearing masks indoors, on public transport and medical facilities. Like many locations these days, the actual number of cases could be three-to-four times higher, as many positive results with rapid tests are never reported to authorities. 
• Covid tipping point reached: The U.S. has extended COVID-19 public health emergency declaration for another 90 days. However, per the GBTA October Poll, domestic travel volume is back to 63% and international travel is back to 50% of 2019 pre-pandemic levels. 78% of travel managers expect the number of employee trips at their company will be higher in 2023. When asked what primary factors are more likely to limit business travel in 2023, 80% of travel suppliers cite economic concerns while only 4% cite COVID-19. There are now more countries and territories—118, according to Kayak.com data—that welcome any US traveler without restrictions. Of the 109 destinations that still require testing, quarantines, or both for unvaccinated travelers, 17 countries are closed and don’t allow US tourism anyway. Go here to find out where you can travel and COVID-19 policies.

Other big considerations:

• Global volatility increases: While we all are reading about deteriorating economies, inflation, recession, geo-political issues, and ongoing environmental concerns, this article from Harvard Business Review helps explain why volatility seems to be at such a high level and suggests an approach for dealing with it all. The fact that there are so many "change vectors" which interact with each other more (interconnections), makes predictions more challenging. This heightened unpredictability is pushing leaders to build in greater ranges of possibilities, create alternative strategies, and shift quickly. While some may see less volume in employee mobility, the importance and variety will be critical as these business strategies play out.
• BQ.1 and BQ.1.1: Time Magazine warns that there is concern around the possibility of a new COVID-19 surge looming ahead as 2 new variants, BQ.1 and BQ.1.1, steadily spread. A few weeks ago, these variants barely showed up on the CDC’s tracker, which suggests they’re able to spread fast. However, preliminary research suggests the new vaccines stoke an effective immune response but less than 10% of eligible Americans have gotten their booster shot so far. 
• Housing: Across the U.S. in October, expect to see: inventory increase modestly, mortgage rates continue to rise, and home prices to dip or at least not rise as fast. While some employees are being priced out of the market, ultimately if a relocating employee is financially ready to buy a home and they are tired of being a renter, then they shouldn't let higher borrowing rates stop them from moving forward. Rate increases are cooling the U.S. housing market, and reduced demand is preventing multiple bid and "no inspection" craziness. 
• Home purchase support: Many mobility programs are re-evaluating their home purchase assistance are looking and considering providing support along with possibly offering discount points, temporary buydown subsidies, and MIDA programs.
• Talent recruitment and interns: According to NACE, nearly a quarter of companies are changing their cadence and timing of recruiting interns, with 93% of those making a change bumping their recruiting up sooner. Additionally, 31% of companies are increasing in-house recruitment staff due to emphasis on acquiring new talent. At the same time, Meta is yanking coveted internship offers from candidates who were supposed to start in the coming months — the latest sign that CEO Mark Zuckerberg’s aggressive cost-cutting push won’t end anytime soon. These two responses reflect two ends of the spectrum, so you will need to know where your own company sits and expects for intern support in 2023.