Perhaps the best way to gain a depth of insight into the relocation industry is to look at the pertinent statistics that move its gears. It all centers around spending, or perhaps more aptly put, proper utilization of spending.
Understanding the different expenses and the areas in which you can save money is paramount to your company's relocation policy.
The average annual expenditure on relocation is no small thing. If you're relocating employees, there are some statistics you cannot afford to ignore. Familiarizing yourself with these numbers and facts is a great step towards a relocation policy that works for both you and your employees.
Industry Wide Annual Expenditure Stats
The relocation industry is big—$25 billion a year big. An average $16,229,125 per company is spent on relocation every year. That's a pretty significant number for most companies, and though it's going to vary from business to business, properly utilizing that money is exceedingly important. With a little research, and a little help from outside sources, you can make absolutely certain that whatever your company's number is, it's handled with care and efficiency.
Average Cost of Moving Employees
It costs more to relocate homeowners and current employees than it does for renters and new hires, with the average relocation costs in 2017 fairly high. It costs an average of $97,166 to relocate current employees who are also homeowners, but just $72,627 for new hires that own homes.
Breaking Down Employee Relocation Costs
Both are big numbers when it comes to employee relocation costs, but current employees have earned their expense. As far as renting is concerned, it costs $24,216 to relocate current employees, and $19,309 for new hires. That's not exactly small potatoes, and if you don’t handle the process carefully enough, you could lose employees and have to go through the process all over again with somebody else.
That's one way that costs add up, but luckily, it's also an area where outsourcing mobility can be a big help in keeping those employee relocation costs worth every penny.
Once Accepted How Long Does the Process Take?
On average, companies give their employees 2 weeks to accept a formal transfer offer. This can seem like a long time to employers, but for the employee that's a small window in which to consider such a significant life change. You should be doing everything you can, providing them with every last bit of information, so that they can make a decision that is not only informed, but right for them.
Once they accept, companies offer their employees an average of 4 weeks to move and report to their new job. Once again, this time frame usually seems more generous from the employers perspective than that of the employee. This is basically crunch time. It's time to get everything in motion, and to focus on a smooth transition. It's time to start thinking about what you can do to help your employee through their move.
Lump Sum Information
Lump sum payments for employee relocation costs have been around since the 1980’s, but their popularity as a means to cover relocation reimbursement has never been as high as it is in today’s market. Lump sum payments are easier to administer. Instead of keeping meticulous records and receipts for reimbursement, your company just gives the mover a one-time payment.
The size of said payment is usually determined by previous relocation expenditure, and tailored to guidelines based on the employees lifestyle and relation to the company. This can be a tricky system to nail down if you don't know exactly what you're doing. That's why most businesses outsource the handling of such policies to companies that specialize in such things.
Outsourcing the Mobility Function
By now you should be well aware of the colossal size of the industry, and how tricky it can be to control the many aspects of the relocation process. Even the most hands on HR departments in the world can have too much on their plates to give relocation the attention it needs.
That's why roughly 60% of companies outsource their mobility function to relocation specialists. Relocation specialists know the industry inside and out. They can not only end up saving your company money on the process itself, but they know things like how to get tax breaks in certain areas, they often have access to preferred deals from vendors, and they can devote their attention to each relocating individual.
Outsourcing mobility will, in most cases, result in your employees feeling more comfortable about the entire process, and you should have no higher priority than their well being.
Hopefully, you've got a better understanding of the relocation industry, and how important statistics are in regards to it!