The Aftermath of the Great Relocation

“Clients never stopped moving,” says Dave Gorton, supply chain manager at Sirva Worldwide, a global relocation company. “People went from thousands to double digits but never fully stopped.” So as the dust settles, what does the Great Relocation actually reflect, and what has been its impact on mobility industry professionals? 

A Quick Recap of the Great Relocation 

The Great Relocation was less about the number of people who moved and more about why people moved—the pandemic versus more traditional reasons such as employment or family-related reasons. A study by Vox showed that for 58% of Americans who moved in 2020, the COVID-19 pandemic was a factor in their decision to move. In 2020, people migrating within the U.S. included people who had their initial move reversed, such as college students who had been forced to move back home as campuses shut down or young professionals who were laid off because of the pandemic.  

Before COVID-19, remote work was a rarity for most workers, with only 4% of total available jobs described as “remote.” But as fully remote work or hybrid schedules grew in popularity due to the pandemic, the number of jobs described as “remote” jumped to 26% of total available jobs in 2022. This seems to have affected migration patterns. “Remote work is inevitably going to affect the relocation industry,” Gorton says.  

As people moved from urban centers to nearby suburban and rural areas, housing prices and demand exploded. Mobility professionals concur on this. “Early in COVID-19, you saw an exodus from the historically high volume locations like New York, Chicago, Los Angeles, and San Francisco,” Gorton says. Many people were initially able to take advantage of low mortgage rates and move to lower-cost suburbs or smaller cities like Phoenix, Miami, Houston, and Nashville. Now these lower-cost suburbs and cities are experiencing a boom that they were not prepared for, with prices skyrocketing.  

It would seem that the real “Great Relocation” took place in 2022 as Phoenix, Atlanta, Tampa, and Miami in particular all saw a double-digit increase in the third quarter of 2022 compared to the national average of 8.3%. It wasn’t just residential movement either. Gorton says that corporate headquarters relocations from California to Texas and Arizona were also common during this period. Gorton describes the ramp-up of relocation business between the second financial quarter of 2021 and the summer of 2022 as “pandemonium.”  

As we get closer to the end of 2023, have we seen the end of the Great Relocation? “I think those high-volume metropolitan areas have stabilized. New York has come back,” Gorton says. Major urban centers are seeing families return, real estate prices in previous hot spots are normalizing or even dropping, and, perhaps most importantly, the number of fully remote jobs is steadily decreasing.  

The Impact of the Great Resignation on the Mobility Industry  

The COVID-19 pandemic brought the relocation industry briefly to a standstill. Companies reported that their international volumes dropped drastically, with data from Atlas showing that two out of three firms reported declining or stagnant international volumes in 2020, and 32% of firms reported that overall volumes had declined. 2021 brought mixed results. Some companies, particularly tech companies, grew exponentially, while others struggled.  

With COVID-19 waning, corporate relocation is beginning to find its feet again. Worldwide ERC’s data shows that there was a 5% increase in domestic relocation in 2023 from 2022. As the demand for relocation increases, mobility professionals must be ready to handle the new challenges that have resulted from the pandemic and the Great Relocation. 

Corporate housing was not immune to the problems caused by the pandemic. First, at the start of the pandemic in 2020, as assignments were paused or reversed due to country borders shutting, there was high demand for temporary housing. As the pandemic continued, employees who needed to sell their homes or relocate were having difficulty. According to a study by Core Logic, nationwide housing prices shot up 20.2% in May 2022. Data from Sirva Worldwide shows that corporate housing inventory was at its lowest levels in recent history in January 2022.  

“Base rents are continuing to rise, and corporations have been directly affected,” Gorton says. “You’re seeing that the supply of rental units is not increasing so there’s a spike in base rental cost that no one can get around. It’s finally starting to normalize a little bit, but there’s such limited availability and they’re all very expensive.”  

Housing markets that skyrocketed are beginning to settle, but continued inventory issues, inflation, and high mortgage rates have kept prices relatively high. Assignees’ needs have also changed. With the advent of remote work and more adult children choosing to live with parents, people are looking for larger houses to accommodate the possibility of themselves and family members working from home. Mobility professionals working with relocations in the U.S. may continue to find it more difficult to find housing for assignees that fit their standards with desired price ranges. 

What Is on the Horizon for Mobility Professionals? 

Gorton doesn’t expect the “new normal” levels to last. “What I am expecting is a return to pre-pandemic norms. The complete lack of business in 2020 is not a new normal, but the complete madness of 2022 is not the new normal either,” Gorton says. “Longer term, you’re going to see an increase in remote work. There’s always going to be a need for talent to move to support the business in those markets.”  

Indeed, mobility professionals looking to navigate corporate housing trends in 2023 should expect remote work to continue to shape the industry. Data collected by Worldwide ERC in 2022 showed that 45% of employees were working remotely in a hybrid schedule, and another 5% of employees were working remotely full time. Further data from Worldwide ERC shows that organizations have said that they are 61% more likely to send employees to new locations for business purposes either as part of business travel or long-term assignments. With employees still working with hybrid schedules, housing preferences such as having more square footage or living further away from the office with more sporadic commutes are likely to come up when working with assignees.  

While home prices may fluctuate depending on what market you’re in, the housing shortage will continue to be an issue nationwide for the rest of the year. CNN reports that the U.S. is short 6.5 million homes as of March 2023. With current housing shortages, some employers, especially those in the tourism and hospitality sectors, are also becoming landlords in order to make units available in unstable markets.  

With so many fluctuations to consider, mobility professionals will have to be prepared for quick thinking and sudden changes in all aspects of their work for the rest of 2023 and into 2024.