Depressed housing markets and other factors are keeping job seekers focused on looking for positions in their own backyards.
Although plenty of Americans are still in the market for a new job, the number of job seekers looking for employment outside of their current geographic area has dropped significantly.
According to a new report by outplacement provider Challenger, Gray & Christmas shows that job relocation rates have hit rock bottom, nearing record lows in the latter part of 2011. From July to December 2011, only 7.5% of job seekers relocated for new positions, which down from a much higher relocation rate of 9.4% during the first two months of the year.
Although the reasons for the drop in employment relocation aren’t completely clear, it’s safe to assume that the nation’s housing market and lingering economic concerns are causing job hunters to think twice before making a major move for a new job.
“It appeared that relocation was beginning to bounce back after plunging in the wake of the housing market collapse and the deep recession that followed. However, the latest numbers indicate that picking up stakes remains a last resort for the majority of job seekers, many of whom are unwilling to take a loss on the sale of a home for a position that may or may not last,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
A continuing lack of employer relocation benefits may also be driving down the relocation rate, especially among employers who are already tentative about adding new positions to their payroll.
“The labor markets are not tight enough yet to compel the vast majority of employers to cover the cost of relocation for new hires. Even if some are willing to cover moving costs, most will not cover the shortfall homeowners would incur by selling an underwater home. So, for now, many people are stuck,” said Challenger.
“At the moment, this is not having a major impact on the recovery. Eventually, as the economy continues to improve, employers will exhaust the local talent pool. If job seekers are still unable or unwilling to move at that point, it is likely to stall companies’ expansion plans and ultimately stall economic growth.”