by Greg Hoover
Atlas World Group Inc.
To get ahead in an increasingly competitive marketplace, smart companies know they have to attract and retain the best workers. But at the moment--with a waning housing market and increasing transportation costs--relocation packages are more important than ever.
After all, the first factor a prospective employee or transferee faces when considering a job change is how he or she will afford to move. This means that companies must examine and revamp their relocation policies as a way to help seal the deal.
According to Atlas World Group's annual Corporate Relocation Survey, that's exactly what many companies are doing. Instead of offering standard relocation packages, nearly one-third of companies surveyed are sweetening the pot with perks such as spousal employment assistance and lump-sum payments.
Improving the relocation benefit is a trend that has developed as the workforce seeks out more flexibility and as the demand for highly skilled employees grows. Companies are being forced to bring top talent to them because they can't find what they need locally. More than half of all companies surveyed in Atlas' 2007 Corporate Relocation Surveysaid that access to qualified workers was the driving force behind corporate relocations, compared with just 16 percent 20 years ago.
Gone are the days when one policy was used companywide. Today, more holistic approaches are custom designed to meet each candidate's needs. Companies are introducing tiered programs to meet the differing expectations of everyone from the entry-level employee to the executive.
One such company is W.W. Grainger, Inc., which has more than 600 branches across North America and China and 17,000 employees. In 2005 the company realized its benefit package wasn't aggressive enough to attract the employees it wanted. Its competitors offered superior packages and were reaping the rewards. Grainger realized that relocation packages played an important role in its recruitment efforts.
"It's a tight job market, and we're in the fight for talent," says Lauri James, the relocation program specialist at Grainger. "We're using relocation not only to attract external talent but to retain internal talent, as well."
Grainger adapted its policy to include six tiers--two for homeowners, two for renters, one for executives, and one for college-recruited employees. Executives can expect to receive nearly $200,000 in relocation benefits, while college-recruited employees and renters usually receive lump sums of between $3,000 and $13,000.
The challenges of a system like this include organizing last-minute moves, facing the declining real estate market, and keeping benefits equitable for similar tiered-positions. But the results have paid off, says James.
A Changing Workforce
In today's global environment, recruitment and retention of employees must be strategic. Workers are no longer clamoring to fill open jobs wherever they can find them. Instead, companies must give prospective employees and transferees a reason to uproot--and ways to convince their family that the move is good for everyone.
Atlas' survey data shows that entire families are more involved in relocation decisions now than ever before. Last year, eight out of 10 employees declined a transfer due to family issues and ties--compared to one out of 10 in 1982. As a result, companies are doing more to acquaint families with their new cities and help them get settled.
The changing demographics of the workforce are another factor influencing the nationwide shift toward more flexibility in relocation policies. The percentage of employees over 40 years old who are being relocated has risen dramatically in the past 40 years. Today, nearly a third of companies report that their most frequently transferred employees are 40 and older--up from 11 percent in 1977.
The same is true for women: 30 years ago, the majority of firms surveyed reported that women accounted for less than 1 percent of their relocations; now women make up nearly 20 percent of all corporate relocations.
The American business landscape has changed tremendously since Atlas launched its Corporate Relocation Survey in 1968. The rising cost of housing and transportation has directly affected the corporate benefits package, as has the dynamic workforce. Despite all these changes, one thing has remained constant: Companies must do whatever it takes to get the right people on board. Companies that follow that ideal and respond to the demands of the workforce will succeed in drawing the talent they desire.
Greg Hoover is senior vice president and chief marketing officer of Atlas World Group Inc., an Evansville, Indiana-based corporate relocation, transportation and global logistics firm that posted record revenues of $986 million in 2006.