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Recruitment & Retention

Published June 2009

Reluctant Relocation: Recruiting in a Soft Market

 

  Agatha Gilmore

Denton Yockey was the ideal candidate: He had model credentials, was a proven hard worker, and the timing was perfect. Sure, he was located in Forth Worth, Texas, and the job was in Kansas City, Miss., but he and his family were thrilled.

Yockey happily accepted the position of president and executive producer at Starlight Theatre Association, a performing arts organization, but a harrowing transition period ensued. His spouse and two children were forced to remain in Texas for months because the couple couldn't sell their home.

"In a good economy, we certainly would've sold our house by now," Yockey said. "I've been racking up a lot of frequent flyer miles. This has been a great opportunity; I haven't regretted anything. But it's been challenging."

As organizations grow leaner and budgets continue to shrink during the recession, having the right people in the right jobs is more critical than ever. But while quality talent might be more willing to relocate for work due to high unemployment rates, organizations face additional challenges when it comes to making that happen.

"The housing market has softened considerably, and as candidates are thinking about relocation, they're very nervous about being able to sell their houses," said Angie Salmon, senior vice president at executive search firm EFL Associates. "[It] has affected our ability to relocate candidates on behalf of our clients, and [it is] making candidates nervous about entering into an employment situation that would require relocation."

A survey of member companies in the Worldwide Employee Relocation Council (ERC), an association for those that manage employee transfers, found 96 percent believe the slow real estate market has impacted their ability to move both current employees and experienced new hires.

Companies must carefully consider the costs associated with relocation, which the ERC estimates are about $62,000 for a new hire who is a homeowner and roughly $18,000 for a renter. In the past, organizations might have just swallowed these initial investments, but today many have trouble justifying them to their executive boards and shareholders.

"For all the reasons we've cited, [the ideal] candidate oftentimes cannot make that move," explained David Barlow, senior vice president and service senior consultant for Sirva, a relocation services provider.

"[So companies have two choices]. One is: 'Is there some way we can make that move happen with Candidate A with modifying policies?' Or do we say, 'We can't have Candidate A, so we're going to live with Candidate B, who is a local and with whom we don't have to worry about relocation?'"

Why Relocate?
There are many reasons a company might want to bring a candidate in from another locale or transfer existing talent from one office to another.

"Depending on the function and the industry, how specific it is and the requirements of the client, it's very possible that there just aren't any candidates in the geography of the client," Salmon said. "A lot of the time, our clients expect they'll have to relocate someone to find the best candidate."