The pandemic, the war in Ukraine, supply chain disruption and labor shortages have helped inflation surge to a 40-year high. Even simple commodities like eggs have become a source of budgetary angst. Many components of talent mobility, including HHG shipping, airfare, and hotel rooms and meals, have seen particularly sharp price increases. With the threat of a potential global recession looming, all eyes are on fiscal responsibility, yet for those in service industries, the customer experience is still as crucial as ever while managing employee relocation costs.
What does this mean for the mobility industry?
Offering competitive relocation benefit is necessary from a talent acquisition and retention perspective, but program managers struggle to balance benefits and escalating employee relocation costs. From now on, the mobility industry will likely continue to see a shift from traditional, full coverage policies to policies that allow more flexibility for the employee and cost control for the employer.
Additionally, companies are moving away from standard lump sum policies that do not offer relocation support outside of the financial to managed lump sum programs (also known as managed cap or managed allowance programs). These managed programs help the employee to spend more effectively. The employee relocation counselor coordinates the benefits and provides ongoing support, resulting in a well-planned, personalized move and a more positive employee experience.
Core/Flex policies are also on the rise. They also feature a managed budget with the flexibility to choose benefits per the employee’s needs; however, they also typically include several core benefits provided to all employees in each policy tier regardless of cost. Often, the core benefits are the household goods move and the sale of the home; however, any benefit can be a core or a flex benefit depending on the company’s culture and historical practice.
The expectation of high-quality delivery of any of these services is a given. Allowing employees to participate in relocation benefits decisions establishes accountability on all sides, discourages exceptions, and supports cost constraints—a win-win for the employer and the relocating employee.