Outsourcing
More than three-fourths of companies outsourced relocation services in 2015 and 2016. These are the highest levels in more than a decade, surpassing even the peaks in 2011 and 2014. Historically, outsourcing remains near highs for large firms, in the higher range for mid-size firms, and increases even further over the historic high of 2014 (65% vs. 54%) for the second year in a row among small firms. However, large firms outsource to a greater extent and with more services than do mid-size or small firms.
Outsourcing for most service categories remained at levels similar to 2015 with slight increases. However, some categories saw significant rises: real estate sales/marketing (39% vs. 28%), real estate purchase (36% vs. 22%), and tax gross-up assistance (25% vs. 18%). These returned to near 2013 levels (42%, 40%, and 28%) after successive decreases in 2014 and 2015. Counseling about relocation planning & details (34%) and counseling about company policy (29%) increased notably from 2015 (26% and 20%), with planning & details counseling returning to the second-highest level historically. However, even with these shifts, outsourcing of most service categories fell between historical lows and mid-ranges, down from the highest levels seen in the past. As companies balance outsourcing which aspects of relocation provide the best cost/benefit based on the needs of employees and their in-house staff capabilities, services surrounding certain relocation aspects may simply be less necessary, while others are simply more likely to be handled in-house.
- Outsourcing at large firms increased dramatically for many categories compared to 2015: real estate sales/marketing (62% vs. 40%), real estate purchase (53% vs. 33%), relocation planning & details counseling (47% vs. 30%), company policy counseling (42% vs. 25%), orientation tours at new location (47% vs. 28%), expense management/tracking/reimbursement (47% vs. 32%), tax gross-up assistance (41% vs. 23%), and claims preparation and submission assistance (32% vs. 21%). However, even with these increases, outsourcing across these categories trends lower than historical highs and mid-ranges. All other categories remain similar to 2015, either at lows or near the lower mid-ranges historically.
- At mid-size firms, outsourcing across nearly all categories stayed about the same or decreased slightly from 2015; the exceptions were real estate purchase (32% vs. 23%) and company policy counseling (29% vs. 21%), which saw marked increases. Despite these increases, outsourcing runs near or at the lowest levels historically across most categories, indicating that mid-size firms are becoming more selective as to which services they outsource.
- Among small firms, most outsourcing categories increased from 2015. The most dramatic were real estate sales/marketing (26% vs. 15%), real estate purchase (26% vs. 11%), relocation planning & details counseling (24% vs. 16%), and property management (18% vs. 10%). Mid-size firms appear to be outsourcing less while small firms appear to be outsourcing more, with their rates across categories becoming more similar. Overall, outsourcing levels for small firms were at or near the highest historical levels for nearly all categories.
Question 40-1
Possible outsourced relocation services in 2016
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Question 40-2
Services outsourced to a relocation service, HRO or brokerage firm in 2016
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International
Similar to the previous three years, far more firms outsourced internationally in 2016 than did overall (84% vs. 77%). International outsourcing remains at historic highs. It is used heavily across firms of all sizes, although large firms outsource a greater variety of services than mid-size and small firms do.
- International outsourcing saw increases across most service categories compared to 2015, with levels falling in the historical mid-range or higher. The five areas which saw the greatest increases are: contract of household goods carrier (44% vs. 32%), destination services/orientation tours (43% vs. 28%), arrangement of family’s temporary accommodations (42% vs. 27%), coordination and monitoring of international shipment (41% vs. 28%), and arrangement of family’s international transportation (31% vs. 22%).
- Similar to domestic trends, outsourcing across categories for small and large firms mostly increased from 2015. Mid-size firms saw either declines or stability across categories with one exception: far more outsourced destination services/orientation tours (30% vs. 18%).
Among companies that outsourced relocation services domestically, the percentage that also outsourced internationally is the second-highest historically (95%), just under the record set in 2014 (98%). For the third straight year, firms that outsource domestic services and relocate internationally almost universally outsource services abroad. Large firms continue to be the most active for outsourcing internationally: around a third or more did so across all survey categories.
Question 44j-1
List of possible outsourced international relocation services in 2016.
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Question 44j-2
International services outsourced to a relocation service, HRO or brokerage firm in 2016
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