Technology, Tight Labor Market Put Relocation in a Rut

Just over 10 percent of job seekers relocated for work in the first six months of 2018.
By: | September 4, 2018 • 2 min read
relocation

Given the tight labor market and advances in technology that now allow people to work from nearly anywhere, will the idea of relocating for work soon go the way of the rotary phone?

Just 11 percent of job seekers relocated for work over the last decade, compared to nearly 19 percent of workers who relocated for new positions in the previous decade, according to new data released by global outplacement consultancy Challenger, Gray & Christmas Inc.

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And that trend is only continuing: Just over 10 percent of job seekers relocated for work in the first six months of 2018, virtually unchanged from the relocation rate in the first two quarters of 2017. The relocation rate in the third quarter of 2017 was 16.5 percent, the highest quarterly relocation rate since the second quarter of 2009, when 18.2 percent of job seekers moved for new positions. However, by the fourth quarter of last year, just 7.5 percent of job seekers relocated, bringing the annual average to 11.2 percent, according to the firm. (The data is based on a survey of approximately 1,000 job seekers who successfully found employment each quarter.)

In 2000, the relocation rate was 22.9 percent, the last year the rate hit above 17 percent. Since then, the annual relocation rate for job seekers has averaged 12.7 percent.

“The one-fifth to one-quarter of workers who were moving to find positions in the late 1990s is nothing compared to what we saw in the mid-to-late 1980s, when nearly one-third of workers were moving for new positions,” said Andrew Challenger, vice president of Challenger, Gray & Christmas Inc. “Much of that movement could be attributed to economic recovery policies after the 1982 recession.”

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The current relocation rate of 10 percent is 72 percent lower than in the mid-to-late 1980s. The average annual relocation rate from 1986 (the first year of Challenger tracking) to 1990 was 35.2 percent.

As for the current falling relocation rate, Challenger said, a confluence of issues are contributing to the downward trend.

“There is a lot of risk involved in picking up your life and moving to another area. Especially now, in such a tight labor market where jobs are plentiful, job seekers don’t have to leave the security of their homes to find new employment,” said Challenger. “Meanwhile, technology has made it so that workers can work from virtually anywhere. Even workers who are offered relocation packages may forego the hassle if they and their employers agree their jobs can be done remotely.

“This expansion in technology has also allowed companies to grow exponentially, giving opportunities to workers across the country. Over the years, in many cases, companies have found it more beneficial to go to where the workers–and favorable business conditions–already exist rather than have talent come to them,” he added.

Web Editor Michael J. O’Brien has been with HRE for more than a decade and holds a degree in economics from Boston College. He can be reached at [email protected]

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