5 Employee Relocation Trends That Will Dominate 2018

January 30, 2018

Employee relocation trends reflect business, economic and, in 2018, political trends. So in this era of high employment and stagnating wages, businesses will need to be more creative than ever to attract talent. Providing employees with flexibility–in their careers, in their moves and in their work locations–appears to be the preferred approach moving into 2018. That’s not coming out of the blue, of course: All of these trends are continuations to those of the last couple of years, as the economy–except perhaps for wages–has recovered.

Likewise, as employers merely tweak the “how” of relocation, don’t expect the “what” to be all that different from 2017. Overall, employee relocation activity is expected to remain stable or increase, RISMedia reports, citing various surveys and reports.

This year, however, there’s a political wildcard that could throw for a loop anyone predicting relocation trends: the tax bill.

The tax bill changes everything

The recently passed tax bill (officially, the Tax Cuts and Jobs Act of 2017) includes big changes that relate to relocation, according to the law firm K&L Gates LLP, and it could leave employees with a greater tax liability.

In 2017, even employees who didn’t itemize could still deduct moving expenses. That ends with 2018: Under the new law, this deduction will no longer be available–at all. In addition, payment or reimbursement of an employee’s moving costs will be considered taxable compensation to the employee except, in some cases, for members of the military.

The implications of the legislation remain to be seen; companies will need to pivot quickly, but it’s too soon to say how or how much. For now, let’s focus on the theme of the rest of 2018’s trends: Flexibility.

Short-term moves on the rise

Sixty-two percent of respondents to the Cartus 2017 Domestic U.S. Relocation Policy and Practices Survey use short-term and temporary assignments. Expect this percentage to grow; 94% of survey respondents expect short-term relocations to increase or remain the same over the next two years.

“Their use now is a reflection of companies’ needs to build more flexibility into how they handle employee relocation, while balancing demands for cost control, talent development, and the employee experience,” says Mark Sonders, Cartus senior vice president. Another example of flexibility in practice relates to relocation packages themselves.

Destination services becoming standard

Just a few years ago, destination services were not offered as a standard benefit; when they were offered, they were limited, Relocate Magazine reports. That’s changing. They’ve become a standard benefit and are more expansive. This trend is expected to continue into 2018 and beyond.

Renewed focus on career mobility

Everything old is new again. Back in the mid-20th century, many employees stayed with the same firm for decades. We may never again see life-long careers at one company, but the pendulum is swinging back in that direction, and it has implications for relocation.

“One of the more powerful emerging employee engagement ideas is the development of career mobility programs for employees,” according to Yash Chitre, VP of hubEngage, an employee engagement platform.

This could have a significant effect on relocations, depending on where employees want to go–literally and figuratively–with their careers.

Actual location will matter more

Employers will be pushing more intensely for on-site workers, predicts Dan Schawbel, partner and research director at Future Workplace. “Companies will continue to promote their workspaces and design them to facilitate interpersonal relationships between employees.”

And it’s not just the employers who want people to connect, he says, citing research conducted with Randstad. That survey found–perhaps surprisingly–that Gen Zs and millennials prefer in-person conversations to using technology, and corporate offices to working remotely.

This could require relocating remote workers to cities with corporate offices–provided they are willing to move.

Other experts aren’t willing to join Schawbel in tolling the death knell for telecommuting. Josh Millet, CEO of Criteria Corp., a pre-employment testing company, puts a remote workforce on his list of employment trends to watch in 2018. Similarly, HR Playbook calls “working wherever and whenever” a trend to watch in 2018.

“Even when the offer is amazing, more candidates are opting out of moving for a job,” according to Korn Ferry’s 2018 predictions. Employers are responding by letting workers work remotely. Whether Schawbel is proven right or wrong may depend on–you guessed it–the tax bill.

Pulling it together

Leaving the tax bill out of the equation for the moment, there’s a general consensus that employee relocation will continue at the current pace–or perhaps expand. Expect employers to become more flexible, both in encouraging workers to move to positions they desire within the organization and in providing the support to make that happen.

But the tax bill calls relocation benefits into question. How will employers respond to the changes? The only prediction you can be sure of is this: 2018 will keep us on the edge of our seats.

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