The three biggest challenges causing global relocation managers to lose sleep are controlling costs (named by 77% of respondents), housing (47%) and compliance-related issues (45%), according to Cartus Corporation’s 2014 Trends in Global Relocation: Biggest Challenges survey of international mobility managers.
Greater China (53%) was ranked as the most challenging global region with respect to controlling costs, followed by Africa andCentral America/South America, which tied for second (49% each). The Middle East was the third most challenging area when it comes to containing costs (47%).
North America (51%) remained in first place as the region most critical to future business success; Greater China (41%) retained its 2013 second-place ranking. North America and China were followed by Europe (35%) and Central America/South America(29%).
North America was also tops in another key area: when asked which regions saw the biggest increases in relocation volume over the past two years, 53% of respondents ranked North America first, nine percentage points higher than last year (44% in 2013). Greater China, last year’s second-place location, fell to third this year, dropping eight percentage points (29%), whileEurope rose from third last year to second this year (35%). North America was also named by respondents as one of the least challenging regions when it comes to managing employee relocations.
“North America continues to rank as the most important region for future business success and is a vital destination for multinational corporations that need to transfer employees,” said Matt Spinolo, executive vice president of Cartus. “This is reflected in the fact that this region has seen the largest increase in relocation volume over the past two years. Not coincidentally, North America is also one of the least challenging regions to transfer employees both to and from.”
“The decrease in activity into China is in line with the country’s slower economic growth as well as the increase in assignee concerns over environmental conditions,” said Ian Payne, Cartus executive vice president and managing director, EMEA and APAC. “Meanwhile in Europe, economic growth remains uncertain, creating concerns about corporate investment despite the region’s continued importance to world trading.”
Immigration and Visas: Hurry Up and Wait
With visa and immigration regulations increasingly becoming more complex and companies continuing to send their assignees to an expanded number of locations, an increased focus in this area is not surprising.
In fact, the No. 1 immigration-related challenge in which companies are seeing an increase is the need for upfront planning due to the length of time it takes to obtain visas (83%).
Government concerns for full employment for nationals are also putting pressure on visa and immigration regulations.
Stealth Expats: Flying Below the Radar Can Be Risky Business
Separately, as many countries become more focused on capturing tax revenue, they are also becoming more diligent in pursuing taxes owed by assignees. This can be a particular issue for employees on temporary or short term-assignments, who may not always be tracked or reported on with regularity, giving rise to “stealth expats.”
Among the temporary assignment types frequently used by companies are commuter and extended business travel, both of which have tax compliance as their No. 1 challenge, according to Cartus’ 2014 Policy & Practices survey. Approximately two-thirds (64%) of respondents to the Biggest Challenges survey said that they were putting increased focus on better internal tracking of assignees’ days in country.
The Cartus survey, which focused on challenges in 11 geographic regions worldwide, received responses from 164 international mobility managers who were asked to evaluate regional challenges, and to rank—by degree of severity—issues specific to each region. Cartus found that many of the issues impact not only the company’s relocation managers, but also the daily lives and job success of their employees.
For additional information, click this link to our 2014 Trends in Global Relocation: Biggest Challenges survey; and click this link to watch the accompanying video.
For more information visit www.cartus.com.