COVID-19 has affected many industries, especially Global Mobility and international assignment management. Whilst there’s currently uncertainty about the prospect of future travel, it’s inevitable that countries will begin to open their borders again, meaning Global Mobility Managers must be prepared to navigate this challenging terrain.
But what can Global Mobility Managers expect over the coming months?
Here, Nick Sutton, Vice President of Global Business Development with Crown World Mobility, shares his expectations for the relocation industry, with specific focus on the effects on moving household goods.
Freight and shipping rates will continue to rise
When COVID-19 initially broke out, there was a sudden drop in available transportation lines due to international lockdowns and borders closing. The immediate result was freight and shipping rates increasing significantly. Months later, rates are now 3-5 times higher than they were at the beginning of the year. Although many assignments are currently postponed, Global Mobility Managers can expect a surge in expatriation once restrictions begin to ease. When this happens, companies can expect costs to still be significantly higher than usual to cope with demand - these increased rates should be taken into consideration when budgeting for new assignments in the next 12 months.
Expect longer lead times and delays in shipping
In this unprecedented time, supply will struggle to keep up with demand, extending the lead time for moves, as bookings of shipping and freight slots are subject to limited availability for all users – not only the moving business. Global Mobility Managers will need to consider that the huge increase in demand means that containers holding an assignee’s household goods will now be competing with the increase in other shipped goods that are being moved around the globe to support the COVID-19 crisis.
On top of this, there is a significant backlog in some areas; some containers which were shipped before the pandemic led countries into lockdown couldn’t be delivered due to the risk of spreading the virus. These containers will be first on the list for delivery once restrictions ease. In some circumstances, the delivery couldn’t cross borders due to country closures, becoming stranded mid-journey. These stranded containers were then put into storage and will remain there until it’s deemed safe for the relocation company to re-deliver – leading to further delays.
The expected delays in the freight and shipping industry will also affect other areas of your assignees move. For example:
- If the container doesn’t arrive when expected, are you able to provide furnished short-term accommodation?
- Can leases in short-term accommodation be extended until the assignee’s furniture and household goods arrive?
- Or if furnished accommodation isn’t available, can you rent furniture temporarily or do you need to come up with other alternatives?
Companies and Global Mobility Managers must consider alternative arrangements to support the assignee if delays in the shipment of their goods mean that they can’t move into their more permanent housing.
Global Mobility Managers will need to prioritise assignments
Every government in every country is facing the challenge of what will happen once borders re-open. Companies, Global Mobility Managers and the assignees themselves may experience some hesitation to be the first ones to begin new assignments.
The combination of expensive and delayed shipping makes it important for Global Mobility managers to prioritise their assignments now and prepare for the time when business starts moving again. It will pay off to stay closely informed by your relocation provider about which countries are accessible and when restrictions are expected to be lifted, so you can begin planning your workforce activities in each country.
What does the future look like for the moving industry?
In the past, assignees would have moved to their host country complete with the majority of their household goods but in more recent years, even before COVID-19, the number of possessions moved has declined. Instead, assignees and companies have focused on getting to destinations efficiently and often buying new furniture is the quickest way of doing so.
This trend will be accelerated by COVID-19 as companies put more focus onto the speed of the relocation process - being able to get assignees to their destinations quickly, and vice versa being able to repatriate the assignee if an emergency arises unexpectedly. Because of this, Global Mobility Managers can expect to see a fresh demand for adapting policies, but also for more solid emergency evacuation procedures for companies with an international workforce.
NES can support your Mobility Programmes
If you’re looking for support, we have a team of Global Mobility experts who can use their 20+ years of industry experience to support clients with their mobility programmes. We currently look after 12,000+ contractors across the globe and are well placed to support clients with their mobile workforce needs.