The ROI of Relocation: Why investing in a strong relocation package pays off for employers
With 65% of UK workers open to relocating, employers can expand their talent pool by providing support with relocation costs.
Skills shortages and a record number of vacancies have both contributed to a fiercely competitive recruitment landscape. As a result, employers are seeking new and innovative ways to fill gaps and attract the candidates they need, including relocation packages.
In this article, we take close look at relocation packages, the benefits they provide, and how you can create an offering that attracts the candidates you need for long-term success.
What is a relocation package?
A relocation package forms part of an employer’s benefits package, designed to support new and existing employees with the costs of moving for work.
The specific benefits included can vary based on the company, role, and location, but they often cover:
- Moving expenses
- Assistance in finding accommodation
- Temporary housing
By offering relocation packages, companies make a strategic investment in attracting and retaining top talent, ensuring a smooth transition to a new location.
What ROI can a relocation package provide?
While they incur upfront costs for employers, relocation packages can provide an excellent return on investment (ROI) if effectively deployed. This includes several key benefits:
- Reaching and attracting new talent pools: Offering a strong relocation package means you no longer have to rely on the talent available in the immediate area. Instead, you can land the best person for the role by enticing workers from anywhere in the country, or even overseas talent through international relocation. This expanded talent pool can lead to higher quality hires and improved overall workforce capabilities.
- Building employer brand and reputation: Employers who are known to offer great benefits often attract the best workers – and that goes for job relocation benefits too. Tech giants like Google and Amazon top the list of prospective employers for many talented workers who know that if they need to relocate for their dream job, they will be well supported by their employer. This positive reputation can lead to a stronger pipeline of qualified candidates and increased interest in your company.
- Standing out in a competitive market: In a competitive recruitment landscape, offering, enticing benefits are one way for employers to stand out from the crowd and entice workers. Perks such as relocation packages are increasingly factoring into employees’ decision-making, alongside salary and flexibility. By offering comprehensive relocation support, you can gain an edge over competitors who may not provide such assistance.
- Reducing turnover and boosting retention: Hiring is an expensive process, which is why it’s crucial to retain high-performing staff. A good relocation package helps candidates to settle in and hit the ground running in a new job, reducing potential worries around finding accommodation and affording to move. In addition to this, research shows that the cost of living is increasingly causing workers to look for new roles with higher salaries, so any relocation package that can address those issues will help to reduce staff turnover.
- Increasing employee productivity and engagement: Reducing the stress and anxiety caused by moving allows new employees to focus on their work, leading to increased productivity and engagement from the start. A good relocation package shows employees that you care about their success in their new role, and that you support them and their future development. This investment in the employee’s well-being can foster loyalty and motivation, leading to better performance and job satisfaction.
What does a relocation package include?
Relocation packages are designed to support employees moving for work, and they typically include several key components. Whilst the specifics can vary between organisations, most packages will cover several their core elements.
Let’s explore the common elements of a comprehensive relocation package.
Professional and packing services
Employers often cover some or all of an employee’s relocation expenses. This relocation assistance ensures employees have the support of experienced movers and packers.
Additional perks may include insurance cover to protect against potential damage or loss of items during the move.
Temporary housing
This benefit provides employees with a guaranteed place to live for a limited time, which is particularly useful when they cannot secure permanent accommodation before their start date. Most packages offer at least 30 days of temporary accommodation.
House hunting trips are frequently included as well, allowing employees to visit the new location and search for permanent housing before the move.
Transportation costs
Reimbursing travel expenses and transportation costs is standard in relocation packages.
This typically includes costs such as petrol, aeroplane tickets, train fares, or bus fares incurred as part of the move, recognising that transportation is necessary during the relocation process.
Property assistance
If the employee needs to buy, rent, or sell a home as part of their move, the package could include assistance such as paid advertising for their home, covering early lease termination fees, and other appropriate forms of support.
Family support
Recognising that candidates may be moving with their family, employers should consider the needs of the entire household. This can include:
- Assistance with school enrolment for children
- Providing resources for spousal employment
- Offering support for finding local amenities and community connections
For international moves, expatriation assistance becomes crucial, helping the employee and their family with work visas, cultural training, and language support. Our research shows that 66% of workers view employers who offer family-friendly benefits more favourably, so this aspect should not be underestimated when creating a relocation package.
Steps to creating an attractive relocation package
Relocation packages can be costly, so it’s important to work out what you need to include to get the return on investment you’re hoping for. Here are some key steps to consider.
1. Understand your needs and objectives
Begin by identifying the specific goals and desired outcomes of offering relocation packages. Consider how they tie in with your organisation’s overall talent acquisition strategy.
Thinking about this and understanding how relocation packages can support the overall strategy is the best place to start.
2. Research and customise the package
Examine the types of relocation packages your competitors are offering and what the industry standard is. Things can change quickly at present, including employee expectations too. Try to ascertain what your target employees might be expecting, and tailor the package to these candidates.
Consider whether you’ll support group relocation, where multiple employees are moved to a new location simultaneously, as this can require different logistics and support structures. Also, don’t forget to tailor the package depending on what your location or city has to offer.
3. Determine the package components
You’ll likely want to include the essentials mentioned in the previous section, such as housing assistance, transportation costs, and information on tax savings. Then consider additional offerings based on your research, such as childcare support.
4. Highlight your relocation package during the recruitment process
This could be a significant factor in attracting the best candidates for a role, so don’t forget to showcase the benefits and eligibility criteria of your relocation package to prospective candidates. This can be done in job advertisements and throughout the recruitment process.
5. Provide ongoing support
There should be a dedicated point of contact to help guide candidates through the relocation process. After all, the point of the package is not only to attract talent but also to help ease the process of moving.
6. Review and update regularly
The needs of relocating employees are constantly evolving, making it vital to regularly review and update your relocation package to ensure it remains attractive and relevant. You can do this by gathering feedback from relocated employees and using it to identify areas for improvement.
7. Consider flexibility
While having a standard package is useful, consider offering some flexibility to cater to individual needs.
This could involve providing a lump sum that employees can allocate as they see fit or offering a menu of options from which employees can choose.
How to evaluate the ROI of your relocation packages
Once you have diligently researched, crafted, and implemented your relocation packages, it is crucial to assess their return on investment (ROI) to determine their overall effectiveness.
Here are some key methods for evaluating ROI:
- Attraction and retention rates: Keep an eye on how many candidates are drawn to your organisation because of the relocation package and track retention rates post-move. A high retention rate among relocated employees is a telling indicator that your package is successful.
- Employee satisfaction and engagement: Regularly conduct surveys, feedback sessions, and open forums to gauge the satisfaction levels of relocated employees. Their insights will provide invaluable feedback on the strengths and weaknesses of your offerings.
- Performance and productivity: Evaluate whether relocated employees are meeting their performance targets and contributing to overall organisational success. Compare these metrics with those of non-relocated staff to identify any notable trends or differences.
- Your company’s brand: As mentioned earlier, a robust relocation assistance programme can significantly enhance your appeal to top talent. Monitor shifts in brand perception to ascertain whether your relocation packages are positively influencing your reputation in the labour market.