Is there greater pushback on relocation?

Are people less interested in moving? Emphatically, YES! Reluctance to relocate has officially hit an all-time high per Challenger, Gray & Christmas. Their data comes from a quarterly survey of over 3,000 job seekers across the country. In Q1, just 1.6% of US job seekers relocated for new jobs, the lowest level on record. For comparison, The Hustle notes that "between 1986 and 1997, almost one in three job seekers (~29%) relocated for roles. As recently as Q4 of last year, 3.7% made a move. Throughout 2020, 5% did. Prior to the pandemic: 6.8%." Even the Q2 of 2020, during the pandemic, the percentage of people relocating for work was 7.5%, the highest since Q4 2018. 

The Hustle's article goes on to explain that housing and WiFi are the two big reasons. Without a doubt housing costs, increased mortgage rates, higher cost-of-living/inflation, and remote work acceptance are core impactors to the situation. But this trend of increasing reluctance to relocate has been happening for over the last twenty years. Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc. explains that “In the 1980’s and 90’s, nearly a third of job seekers would move for new positions. That has fallen steadily since, as housing costs have risen and companies have moved to where talent pools are located. Now, remote and hybrid positions are keeping workers at home.”

While many companies seek to bring people back to the office, there are still more fully remote work options and greater flexibility for where the work gets done than pre-pandemic and it appeals to a significant number of prospective and existing employees. Per additional survey data from the firm, 32% of companies report most of their workers are in the office, though they’re allowing remote work on a case-by-case basis. Of those companies with hybrid options, most workers are in the office two days a week with 29%, while 26% are in 3 days a week. Another 13% are in the office 4 days a week. It is expected that we will continue to see shifting back to the office continue but that a return to the old days is out of the question and hybrid work structures are here to stay. Tech analyst Gartner forecasts that 51% of US knowledge workers will work under hybrid arrangements by the end of 2023 and 20% will be fully remote. 

But housing costs and the cost of living are likely not to adjust quickly. The cost of living in the destination city is a vital consideration for people. Employees assess whether their salary or income potential in the new location will adequately cover housing, transportation, healthcare, taxes, and other essential expenses. 

And for the moment, we continue to look at a buyer-seller stalemate that is keeping home prices high. Forbes reports that in May, "thanks to an uptick in mortgage rates and elevated home prices that together continued to perpetuate the housing affordability crisis, as fears of ongoing inflation, bank sector volatility, debt ceiling drama and an impending recession hang in the air." Most experts are not predicting the housing inventory issue to resolve itself in 2023, and most do not expect mortgage rates to drop dramatically for quite some time.

Ultimately, employees are evaluating whether the ROI is high enough to warrant a relocation. Higher costs are definitely deterring individuals from relocating, while lower costs can make the move more appealing. Even if the finances are manageable, that still leaves people to consider and address personal circumstances, family issues and social support networks, dual career disruptions, commuting issues, cultural fit and diversity of the new location, the overall quality of their life, and of course, their potential future career growth. 

Many of these things that have prompted employee relocation reluctance extend outside the realm of global mobility teams to fix. However, now may be the best time to review and reconsider what is currently being provided and done to support employees with their relocation experience. The reality is that while a company may be moving an employee to improve their business, mobility is not just a work event for the employee and family. Moving is a major life event. In many ways, work is the easy part of the adjustment for employees. Considering how to reduce the level of effort needed by both the employee and the company, providing relevant resources for handling the wide-variety of needs across those moving within your program, and providing a platform or system that make it as simple and efficient as possible is where you have the greatest opportunity for improving satisfaction, cost-control and success.