2012 Allied Workforce Mobility Survey: Recruiting and Relocation

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1 04/2012 About the 2012 Research The 2012 Allied Workforce Mobility Survey, conducted in March 2012, captures the voice of HR professionals on critical topics relating to workforce mobility, which is defined as the willingness and ability of employees to relocate for a job with either a current or new employer. The survey approaches workforce mobility from two angles. One set of questions assesses the mobility environment, the context in which relocation occurs, including economic, cultural, demographic and organizational variables. The second set of questions examines HR topic areas related to or affected by workforce mobility: recruitment, relocation, onboarding and retention. These topics encompass a broad range of activities and responsibilities for HR professionals, not limited to moving or relocating. The survey was intended to identify tools and practices, as well as measures for success in these areas. Survey Methodology The 2012 Allied Workforce Mobility Survey was conducted online with 500* human resources professionals from 49 states and the District of Columbia. The vast majority of respondents are employed by companies (95 percent vs. 5 percent external contractors), across a broad spectrum of HR titles, companies and industries. Respondent Responsibilities Within HR: HR managers/supervisors...28% HR generalists...24% Recruiters...14% HR assistants...13% C-level/Directors/VPs...11% Study results are scheduled to be released in stages: Recruiting and Relocation: April 30 Retention and Onboarding: May 21 Further Survey Details and Analysis: June 11 Sponsored by Allied Van Lines, the survey is intended as a service to human resources professionals and is part of a larger ongoing initiative, Allied HR, which will conduct additional research projects, host events and facilitate discussions in the HR community via the Allied HR website. The topic areas and questions for the survey were determined through collaborative discussions involving Allied Van Lines, Allied s independent research partners, and distinguished HR professionals. *A sample of 500 yields a confidence interval of 95 percent ± 4 percent. 1

2 04/2012 2

3 04/2012 Results Recruiting and Relocation in Today s Challenging Environment According to the 2012 Allied Workforce Mobility Survey, human resources professionals face a challenging new recruitment environment. The economy is growing and businesses are hiring, with many planning extensive recruiting programs for the coming year. March 2012 marked the lowest unemployment rate in the United States since the beginning of the economic downturn in 2009.** Meanwhile, even though the housing market is slow, HR professionals are optimistic about the willingness of the workforce to relocate and do not foresee obstacles in the way of recruiting candidates from distant locations. Still, many survey respondents admit that their companies are not tuned up for a competitive period of recruiting: Many companies lack confidence in their recruitment and relocation programs. The overall rate of recruiting success for many companies is not as high as it could be. Recruiting incentives, including benefits packages, may not always meet candidate needs or expectations. Recruiters are not using all the recruiting tools they could, including social media. Company relocation packages do not address some key areas, like spousal support. economic context. They noted what they are doing well and not well. In addition, they reported on a wide range of strategies, approaches and practices, which varied not only by the size of their companies, but also by the success of their recruiting and relocation programs (see Segments for more). These differences may illuminate a path toward improved recruitment and relocation performances for all firms, even those that currently lag well behind industry leaders. The Race Is On, But Not Everyone Is Ready Corporate recruiting is moving into high gear in HR professionals may be tripping over each other as they chase candidates of choice. Two-thirds of all respondents characterize their company s 2012 recruitment plans as extensive or moderate, with larger companies being more bullish. Among larger companies (> 10,000 employees), 80 percent are planning for extensive or moderate activity (Figures 1 and 2). Yet many companies aren t ready for a competitive situation. Nearly one-third of all respondents describe their companies as having no recruitment plans or limited plans. Larger companies are more likely to have recruitment plans, according to the survey results. Further, 52 percent of all respondents say their recruitment programs are only somewhat successful, and even highly successful programs lose nearly one-quarter of their top candidates during the process (Figures 3 and 4). More than one-quarter of respondents secure only 50 percent of their top candidates (Figure 5). The 2012 Allied Workforce Mobility Survey, sponsored by Allied Van Lines, asked HR professionals about strategies, practices and performances relating to workforce mobility. The results address recruiting and relocation. Five hundred HR professionals in the U.S. took part in the survey, sharing their perspectives on how they manage recruitment and relocation in the current Given the investment recruitment requires, even a small improvement in this area would yield significant savings. Companies spend on average $10,731 per hire, taking on average 51 days to fill an open position (Figures 6 and 7). (For more insight on how companies with highly successful recruitment programs manage differently than other companies, see Segments.) **U.S. Dept. of Labor, April

4 04/2012 Survey respondents said their companies could do more to improve their recruiting prospects. Most HR professionals, in fact, do not view recruiting incentives at their companies as strengths. For example, only 27 percent rated their firm s healthcare benefits as a 5 (on a scale of 1-5, 5 being a strength and 1 being a weakness). And yet, healthcare benefits are rated the highest among all possible strengths or recruiting incentives. In addition, one-third of respondents rated their company s lifestyle benefits as a weakness, and 15 percent rated relocation packages a weakness (Figure 8). Social Media Not Taking Hold; Best Sources for Candidates Are Still Traditional HR professionals believe the best sources for candidates are usually right down the hall or across the parking lot. Respondents rated employee referrals and internal recruiter referrals as the best sources for candidates rated good or excellent by 74 percent and 66 percent of HR professionals, respectively (Figure 9). Despite all the hype, HR professionals aren t yet sold on social media as a recruiting tool. Only 38 percent rate social media as a good or excellent source. In fact, nearly two-thirds of HR professionals (62 percent) rate social media sites as poor or fair for recruiting, and many respondents said they do not use social media for recruitment at all. Others said they are studying social media sites and developing strategies so they can include them in their recruitment efforts. Candidates Are Willing to Relocate Many candidates are willing to relocate given the right incentives, according to the survey. Most HR professionals do not see significant obstacles to relocation in today s hiring environment. Only 6 percent of HR professionals believe that today s workforce is not willing to relocate (Figure 10). Fifty-nine percent of the respondents reported that the current economic context has had no impact on their ability to recruit and hire. Twenty-one percent reported that it s actually having a positive impact. Relocation packages play a critical role in closing the deal with candidates, according to HR professionals. Fifty-seven percent of HR professionals regard the quality of relocation packages as extremely important or important in determining if a candidate accepts an offer (Figure 11). In an improving economy and a lagging housing market relocation packages will become even more critical in securing candidates of choice. And yet, interestingly, more than one-third of the survey respondents reported that their companies did not have a formal relocation program and another 45 percent reported that their programs are only somewhat successful or unsuccessful (Figure 12). (For insight on how companies with highly successful relocation programs manage differently from other companies, see Segments.) Here are some representative comments from those who use social media: [We are] utilizing Facebook in our campus recruiting efforts for both branding and connecting fellow incoming new hires together. LinkedIn has provided a large forum for us to review hard-to-recruit specialty candidates with experience in [our specific] industry. Facebook posts focusing on hiring awareness have generated solid applicant flow, but not too many high potential candidates. 4

5 04/2012 Many Relocation Packages Fall Short Among companies with formal relocation packages, the most common benefits are moving expenses and temporary living costs, cited by 67 percent and 49 percent of HR professionals, respectively (Figure 13). But, financial components alone are not always enough. The top three variables that limit or restrict a candidate s willingness to relocate are a spousal employment situation, children s plans/schools and selling a home/mortgage (Figure 14). Unfortunately, not many companies address these issues (Figure 15), even among those rated highly successful in relocation and recruiting. For example: While 80 percent of respondents report that a spousal employment situation is a probable obstacle to a candidate s relocation, only 2 percent of companies cover spousal unemployment costs in any form. While 69 percent of respondents say that selling a home/mortgage restricts relocation, only 16 percent of companies offer reimbursement on old-home losses. While 72 percent of respondents say children s plans/schools restrict relocation, only 39 percent of companies offer information on the area and schools. Worse yet, 19 percent of companies in the survey sample do not offer any of the 10 relocation package components listed in the survey. Relocation Packages Vary by Company Size HR professionals at a wide range of organizations (by size, industry, etc.) participated in the 2012 Allied Workforce Mobility Survey, and these differences are reflected in significant variances in the cost of relocation packages. An average relocation package costs $21,033 (Figure 16). While smaller companies, in general, provide less valuable packages averaging $10,971 there are exceptions. Some small companies offer highly competitive packages. When a company big or small really wants a candidate, it can level the playing field by meeting the competition s offer, even if that requires a gold-plated relocation package, the survey suggests. Five percent of the survey respondents rated their relocation packages as excellent or gold-plated, and another 46 percent rate them as good. Even among smaller companies less than 100 employees 4 percent provide excellent or gold-plated packages. According to the survey, gold-plated packages average $65,333 in value. What Makes Candidates Willing or Unwilling to Relocate? The 2012 Allied Workforce Mobility Survey identified and measured the chief variables that influence a candidate s willingness or readiness to relocate: Economic What is the state of the economy? Does it encourage change and risk? Organizational Are companies hiring outside their local areas? Or, are they requiring relocation for existing employees? What incentives or assistance do they offer for relocation? Demographic What age and economic groups are willing or unwilling to relocate and why? Cultural What lifestyle issues encourage or restrict relocation? Findings suggest that the mobility environment is challenging and complex. While the lackluster economy discourages risk, companies that offer the right incentives (salary, career advancement and relocation assistance) can close the deal. The most challenging scenario for companies are employees over age 30 with concerns about selling an existing home, finding spousal employment, and moving children to new schools. When the economic environment is not favorable for relocation, the result is longer recruiting lead times (reported by 62 percent of HR professionals); hiring secondor third-choice candidates (58 percent); and more local hiring (54 percent). 5

6 04/2012 More specific findings on the variables that affect a candidate s willingness to relocate: Economic 30 percent of HR professionals report excessive or high unemployment in their region of the U.S., confirming that the economy is still a long way from recovery (Figure 17). Potential recruits may still be less than confident about changing jobs and relocating in this environment. Organizational Most companies have at least some positions requiring executives to relocate throughout their career, and nearly half of the survey sample reported many roles in this category (Figure 18). Further, companies in the survey sample report that 14 percent of their new hires require a relocation, and more than three-quarters of the sample cast the net wide nationally or internationally when recruiting. However, only one in five respondents rate their company s relocation programs as highly successful, and one-third have no formal relocation program. Also, most relocation programs do not address a candidate s chief worries: spousal employment, children s plans/schools and selling the home. Question: How would you describe the extent of your company s recruitment efforts this year? Source: 2012 Workforce Mobility Survey Demographic Two-thirds of HR professionals (65 percent) believe that young workers age 30 or under are most willing to relocate, followed by workers 31 to 40 years old (cited by 26 percent of respondents). The top two variables that limit or restrict a candidate s willingness to relocate are family considerations related to one s spouse and children, situations that are more common in workers over age 30. Cultural Two factors are most likely to increase a candidate s willingness to relocate higher salary (reported by 82 percent of HR professionals) and career advancement (reported by 79 percent) (Figure 19). Figure 2 shows the percentage of HR professionals rating their recruiting plans as extensive. Results are segmented by the size of the respondent s company. 6

7 04/2012 Results are segmented based on how survey respondents rated the success of their own recruitment programs (e.g., highly successful ). Question: How successful is your recruitment program? Source: 2012 Workforce Mobility Survey Results are segmented based on the recruitment program s rate of success. 7

8 04/2012 Results are segmented based on how quickly companies fill their open positions. Results are segmented based on how much the company spends. 8

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10 04/2012 Figure 9 shows the percentage of recruitment resources rated good or excellent. Question: In your opinion, how mobile (willing to relocate) is today s U.S. workforce? Source: 2012 Workforce Mobility Survey 10

11 04/2012 Question: How important is the quality of the relocation package in determining if a candidate accepts an offer? Source: 2012 Workforce Mobility Survey Question: How successful is your relocation program? Source: 2012 Workforce Mobility Survey 11

12 04/2012 Figure 14 shows the percentage of HR professionals who say the items above are obstacles to relocation. Figure 13 shows the percentage of HR professionals who say the items above are typically contained in their company s relocation packages. 12

13 04/2012 Results are segmented based on the amount spent on relocation packages. Figure 15 shows the percentage of HR professionals who say the items above are typically included in their relocation packages. Question: Describe the unemployment in your region. Source: 2012 Workforce Mobility Survey 13

14 04/2012 Figure 19 shows the percentage of HR professionals rating the items above as reasons for new hires to relocate. Question: Does your company look for executives who are willing to relocate throughout their careers? Source: 2012 Workforce Mobility Survey 14

15 04/2012 Segments Why Some Recruiting and Relocation Programs Succeed While Others Don t The 2012 Allied Workforce Mobility Survey asked HR professionals to evaluate the performance of their own companies in several areas, rating them as highly successful, somewhat successful or not successful. These are self-appraisals and refer to specific areas, like recruiting, not to a company s overall performance, profits or financial standing. Still, they are useful in identifying why some companies do better than others. (For shorthand, highly successful companies are sometimes referred to as best in class. ) Segments Recruiting Most companies are only somewhat successful at relocation, according to HR professionals taking part in the survey. However, a large portion 36 percent are highly successful (Figure 3). Best in Class Spend More, Recruit Internationally Companies best in class at recruiting spend more than twice as much per hire ($12,737), as compared to unsuccessful companies (Figure 20). In addition, 73 percent of the best-in-class companies search for candidates internationally and across the United States, as opposed to 35 percent among companies unsuccessful at recruiting. Best-in-class companies Spend more, recruit and relocate more Recruit and relocate internationally Are usually larger in size Have more resources and leverage more incentives Best-in-class companies cast the net wider, in part, because they are more confident about securing candidates in distant locations. They view the workforce as more mobile than other companies. Fifty-eight percent of HR professionals with best-in-class recruiting programs believe the current U.S. workforce is highly mobile or moderately mobile, versus 48 percent and 39 percent of HR professionals with somewhat successful or unsuccessful recruiting programs. But, at the same time, some smaller companies compete effectively with larger companies. The survey uncovers several areas where companies could differentiate themselves: By addressing personal areas of concern in relocation, e.g., spousal employment and children- and school-related issues; By providing flexible relocation packages suited to the individual candidate; By addressing economic issues related to relocation, e.g., reimbursement for selling the old home or help selling it. Best in Class Are Larger Companies (But Small Companies Can Be Best in Class, Too) Typically, companies best in class at recruiting are larger than less successful companies. Forty-two percent of best-in-class companies have annual revenues of more than $1 billion. Yet, best-in-class companies are also found among companies with revenues under $1 billion or even under $100 million. About a third of companies in these categories are best in class in recruiting. The analysis below concerns the first set of research findings, which focus on recruiting and relocation. Other research findings will follow on May 21 and June 11, with additional implications. 15

16 04/2012 Best in Class Use More Sources, Have Better Incentives Companies best in class at recruiting are more likely to rate all sources for finding candidates as excellent, indicating their ability to leverage a range of tools to identify potential hires (Table 1). They re also more likely to rate their own recruiting incentives as strengths (Table 2). Best-in-Class Recruiting Programs Spend More Per Hire Best-in-class recruitment programs spend more per hire, on average $12,737 (not including relocation costs), as compared to $10,504 and $4,750 by somewhat successful and unsuccessful programs, respectively. As a result, they secure their candidates of choice 77 percent of the time, as compared to 66 percent and 59 percent for somewhat successful and unsuccessful programs. Segments Relocation Most companies are only somewhat successful at relocation. Only one in five HR professionals rate their relocation program as highly successful (Figure 12). In the context of the survey, a successful relocation program is one that enables the HR professional to close the deal. Best-in-Class Companies Recruit and Relocate More Companies best in class at relocation recruit more often, cast the net wider when recruiting, and relocate employees more often than other companies. Eightyfive percent of best-in-class companies search for candidates internationally, as compared to 76 percent and 39 percent of somewhat successful and unsuccessful programs, respectively. Far more talent is available to companies with successful relocation programs because of the scope of their search. Thirty-seven percent of best-in-class companies are planning extensive recruitment efforts in 2012, as compared to 26 percent and 12 percent somewhat successful and unsuccessful programs, respectively. Companies Best in Class at Relocation Are Larger Companies best in class at relocation are larger, averaging 60,207 full-time employees, as compared to 33,170 and 9,349 employees at somewhat successful and unsuccessful companies, respectively. Yet there are small firms that succeed at relocation, too. For example, 9 percent of companies with 100 employees or fewer are best in class. Companies Best in Class at Relocation Provide More Incentives Best-in-class relocation programs are more likely to include all of the relocationpackage components listed on the 2012 Allied Workforce Mobility Survey (Table 3). For example, 74 percent of best-in-class relocation programs provide temporary living costs, as compared to 60 percent and 22 percent of somewhat successful and unsuccessful programs. Approximately 17 percent of best-in-class relocation programs offer an excellent or gold-plated relocation package, as compared to 1 percent of somewhat successful programs. Best-in-class relocation programs cost considerably more, on average, $33,193 per package, as compared to $18,730 and $13,167 for somewhat successful and unsuccessful programs, respectively. Better Relocation Results in Better Recruiting A good relocation program is critical to success in recruiting: Highly successful relocation programs go hand in hand with highly successful recruitment programs (Figure 21). 16

17 04/2012 Results are segmented based on how the respondents rated the success of their recruitment programs. Table 2 shows the percentage of HR professionals rating their recruiting incentives as strengths. Results are segmented based on how survey respondents rated the success of their own recruiting programs. Table 1 shows the percentage of HR professionals rating resources for finding candidates as excellent. Results are segmented based on how survey respondents rated the success of their own recruiting programs. 17

18 04/2012 Table 3 shows the percentage of programs incorporating various relocation package components. Results are segmented based on how survey respondents rated the success of their own relocation programs. Results are segmented based on how the survey respondents rated the success of their relocation programs. 18

19 04/2012 Implications Five Lessons for Recruitment and Relocation Success Based on the 2012 Allied Workforce Mobility Survey, here are a few lessons toward a faster, more effective talent pipeline. These lessons concern the first set of research findings, which focus on recruiting and relocation. Other research findings will follow on May 21 and June 11, with additional implications. Lesson 1: If the Best in Class Can Do It, So Can You It s a challenging environment for recruiting. Among the specific concerns raised by HR professionals: High unemployment, which discourages risk Soft real estate market, which makes it hard for candidates to sell their current homes Limited mobility among older (experienced) executives Increased competition for talent Still, only 20 percent of HR professionals report that this environment has had a negative impact on their company s recruiting performance. In fact, companies highly successful at recruiting report that the environment has made no impact or even a positive impact. So, Lesson 1 is If the best in class can do it, so can you. What are the best in class doing that works? Investing (attention, time and money) in talent acquisition, as though it were actually as important as everybody says it is. Developing career paths and cultures at your company that are as attractive as the salaries and benefits you offer. Adopting relocation practices that differentiate you from the competition (see Lesson 2 below). Lesson 2: Give Recruits What They Really Want It s no secret that higher salaries and career advancement are two of the most important incentives you can offer a candidate for relocation, and most companies prepare offers with these considerations in mind. But there are also well-known deterrents, and these are not usually addressed: The spouse s employment situation Children s plans/schools Selling the current home and managing the mortgage Therefore, the opportunity to differentiate your firm is enormous: Only 2 percent of companies help with spousal employment Only 16 percent will assume a loss for a recruit s underwater mortgage Only 39 percent offer information about the local community and schools Lesson 3: Make Your Relocation Package More Like a Package Recruits have diverse needs, especially those who must relocate. A married candidate with children probably won t want the same things as a young single looking for career advancement and an exciting nightlife. Yet most companies do not offer a range of benefits tailored to particular types of recruits. Further, most packages are limited in the types of benefits they incorporate. The 2012 Allied Workforce Mobility Survey asked HR professionals which of 10 components their companies include in relocation packages (Figure 13). Surprisingly, 19 percent don t offer any of the components not even relocation consultation. Also significant: 72 percent offer only four of the 10 components or fewer. 19

20 04/2012 Do you need to offer all 10 in your relocation package? Probably not, but evaluating your relocation package against the competitive landscape and the range of possible components would be a useful exercise. It may enable you to get the edge on your competition. Lesson 4: There s Room for Improvement HR professionals are not shy about calling out weaknesses in their recruiting incentives. The most common weaknesses were: Lifestyle benefits (31 percent) Relocation packages (15 percent) Retirement benefits (11 percent) Lesson 5: David Can Beat Goliath True, larger companies are more successful at recruiting and relocation than smaller companies, according to survey results. Larger companies have deeper pockets, more experience, better systems, etc. Yet lots of small companies are successful, too. These companies are making large investments, enabling them to level the playing field. Size doesn t need to be an impediment. With attractive salaries, career paths and relocation packages, your company may compete with the best and win. For more details about what the best in class in recruitment professionals are doing, consult Segments. Further, most HR professionals do not view their own recruiting incentives as strengths (Figure 8). The incentives that rank at the top still receive low marks. HR professionals can make a difference by focusing on what they can improve: Only 21 percent rate company culture/atmosphere as a strength. This is an important area where human resources professionals have the training and skills to make a major contribution. Only 4-5 percent of HR professionals rate their negotiating and closing skills as a strength. Given their strong interpersonal skills, human resources professionals could make quick strides forward in these learned skills. 20

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