Introduction
The global impact of the Covid-19 pandemic is still being felt despite the welcome return to normality over the last two years.
The protracted lockdowns hit countries across the world, with many businesses grounding to a halt and having to make the difficult decision to shed high volumes of people just to stay solvent. In the global mobility industry, there were several high-profile mergers and takeovers within the larger relocation management businesses. This was largely a result of the market’s contraction, when it was challenging to simply leave your local authority area, never mind moving country.
Similarly, the recruitment market was struck by high numbers of redundancies in both low-skilled and high-skilled roles. One client we contacted within the airline industry made over 10,000 employees redundant in a 12-month period.
To take a deeper dive into the impact of the pandemic on business attitudes to relocating their people, we sent out a pulse survey to our customers. Respondents came from a variety of industries, including technology, pharmaceutical, oil & gas, mining, logistics and the public sector. We wanted to understand the impact of Covid-19 on employee relocations and what the next 12-18 months hold for them.
Before diving into the findings, let’s first take a look at the current work and relocation landscape.
Work culture: Impact on relocation
According to a recent report from a leading global relocation management company, just over half of the respondents reported that the number of employee relocations increased in 2022 but dipped in 2023 due to the fragility of the economic climate.
Another recent report, from Absolute Reports, showed the mobility sector’s growth rate slowing from 5.57% in 2022 to 4.16% in 2023 despite the sector’s overall value increasing. The trends are positive over the next three years, with the forecast predicting the mobility market will continue to grow, albeit at a slower rate than in the past three years.
The changes in the way we work have impacted relocation trends. According to the Office for National Statistics, from September 2022 to January 2023, 16% of employees reported working solely from home, while 28% reported a combination of working from home and visiting their office.
While working from home and hybrid working remain fluid, the pandemic clearly altered how most of us work. In the UK, people increasingly seek greater flexibility in their jobs, and some have opened their eyes to the possibilities of working for the same business but in a different country.
The introduction of the Digital Nomad Visa in 49 regions worldwide encourages people working in the IT industry to relocate abroad if their personal circumstances allow it. According to a Statista report, in the US there were 17.3 million digital nomads in 2023, a staggering increase of 10 million over 2019 data.
Against this background, let’s explore the findings from BTR’s survey.
Relocation survey: Key findings
The purpose of our pulse survey was to get a clearer picture from our customers about the ongoing impact of the pandemic on their attitudes to relocations.
Falling relocation numbers
Significantly, 89% of respondents indicated that the number of employees relocating decreased due to the pandemic, while 11% indicated no change.
There were several reasons for this. Restrictions on movement, slower immigration processing speeds, and visa backlogs all contributed to the slowdown in relocations. Many organisations even implemented a travel ban for all but essential travel. The economic slowdown also created financial constraints for many businesses, which resulted in recruitment pauses. For some businesses, this had a knock-on effect on relocations because their talent search would often be global. Simply, less recruitment meant fewer relocations.
Post-pandemic
Respondents continued to see a decrease in the number of relocations post-pandemic, as many people were still wary of international travel because of health concerns and potential disruption to travel.
There were also concerns about supply chain disruption leading to delays in international shipments and issues with finding attractive housing. Some respondents reported a decrease in the number of household goods shipments but increased storage as individuals put more belongings in storage at their home location.
Oil and gas
Respondents in the oil and gas sector suggested there were fewer relocations due to many employees simply not being willing to relocate. This means that recruitment and relocating employees to hardship locations or the remoter parts of the world are proving much more challenging than pre-pandemic.
Several reasons were suggested for this. People have greater choices of where to work, demand increased flexibility on working from home, and the higher financial incentives may appear less appealing compared with a better quality of life.
On top of that, a move away from fossil fuels led to a general downsizing across the industry in many regions, which means fewer employees relocated to work in these locations.
Public sector
While most sectors reported a decrease in relocations, the public sector saw a slight increase. This can be put down to the urgent need to recruit internationally to fulfil the expanding medical workforce.
Post-Covid, when asked whether their company relocation policy has changed its relocation policy, 50% said they hadn’t. The other 50% said they had changed their policy because of external factors rather than due to the impacts of the pandemic. The most significant factor was wanting to improve the way they relocated people, with 10% of the companies saying they now provide a lump sum allowance, with people able to pick and choose the services they want from their relocation provider up to a set amount.
The future
Looking ahead to the next 12-18 months, we asked respondents how they see their employee relocations changing.
Only 10% of respondents anticipate relocating fewer employees, while 40% anticipate increasing relocations. The remaining 50% said it would depend on market conditions, recruitment needs, and the ability to source talent for hard-to-fill roles. Many companies said that they were focusing relocations on certain geographies where they could source talent using targeted relocation recruitment campaigns.
Final thoughts: Looking ahead
According to recent Randstad data, global economic growth will remain slow in 2024, with any uplift likely in the latter half of the year. While this is likely to be a challenge, higher employment levels are good news for employee relocations as businesses seek to develop and attract key talent.
Our fast-responding team of experts is on hand to answer any questions you might have about BTR International’s complete, start-to-finish, customisable range of relocation services.