The COVID-19 pandemic has basically impacted all aspects of life including the way we work and travel. We are living in times of great uncertainty. In this blog post, I shed light on the global mobility trends 2020/2021 and how the pandemic will hit this sector regarding expat management. As a coach of expat partners, I always follow the global mobility industry closely. So, here are my observations.
Companies have faced unprecedented challenges in their human resources (HR) department during the first months of the COVID-19 outbreak. Imagine the organisational but also emotional challenge to relocate families across the world during times of great uncertainty, managing employees that are stuck on holidays somewhere on the planet, and deciding on expat contracts when no one can even predict the near future and how long borders remain open. For expat families, crucial decisions had to be made quickly with enormous emotional weight. Should we stay together as a family? Should we send the kids to a place that might seem safer without knowing it for sure? How to live in a household where all your belongings have already been shipped to a place where you decided not to go to in the end? How to evacuate an assignee on short notice?
Current trends in global mobility
Families and companies have been challenged to find quick solutions for big questions. The short-term consequences of COVID-19 will most probably shape the future path of global mobility. Here below are some trends that will shape the future we expect on the knowledge we have right now.
#1 Uncertainty triggers less commitment
Next to long-term contracts, a more flexible approach such as short-term assignments, business trips, and remote expat models have been on the rise. While still not filling the gap of an employee working abroad for a couple of years, the rising variety in expat contracts allows companies and employees to continue their global work in an environment where families are hesitant to move abroad. This trend was already being surveyed before the COVID-19 outbreak as one can see in the latest KPMG survey (PDF) from 2019.
Over the next 5 years, the participants surveyed in 2019 expected to rely on shorter duration assignments such as:
• 75%, short-term assignments
• 56%, extended business trips
• 46%, developmental/training assignments
It will be interesting to see how the pandemic will change these statistics. All major global mobility experts are undertaking their 2020 surveys at the moment but a reinforcement of short-term-assignments is expected. While a rising number of expatriations have been expected pre-pandemic, many companies have seen a reduction in overall assignment numbers over the last couple of months.
The improved offer of real-time communication tools and the forced shift to home office within major companies have triggered the question of whether long-term-assignment still holds the same value for the company. However, it still has to be proven whether online communication can replace in-person meetings in the long term, especially on a culture level.
Many industry experts are also declaring the rise of virtual assignments. These can have different forms: working from home within your home country or even working from home in a country of your choice. It comes with many pros and cons as you can see in listed below (from a report by Mercer).
Dual Career and family issues
Widening the talent pool
Not all jobs can be performed remotely
Tax and compliance
Damage company culture and teamwork
No automatic cost saving scenario
#2 Expat package management moves to more flexibility and customisation
While most expats are men (80%), the workforce is getting more diverse in terms of gender, age and career aspirations by the week. Companies struggle with finding the right person for the assignment with a one-size-fits-all approach. Employees of different gender, age and life goals have different expectations of how the company should facilitate the assignment and get more vocal about that. Those in the category termed as ‘dual-career couples’ are increasingly worried about their partner’s career and different generations require different forms of support throughout their time abroad (Ernst & Young Study 2019). On the other hand, companies are aiming for more flexibility within their expat packages not only to attract candidates but also to reduce costs and improve their image as a modern employer. So, it can be said that increased flexibility within the expat package planning has been a required management task for a while but the pandemic means an even higher degree of customisation is required. An outcome of the pandemic will be seeing how good the expat package took care of the employee in times of crisis and whether the package was flexible enough to react accordingly.
The macroeconomic effect of COVID-19 also affects the cost-of-living situation. Companies and employees face a dynamic situation with significant exchange rate volatility as well as uncertainty about inflation. Hence, the expat packages also require flexibility in terms of Cost-of-living-allowance (report by Mercer).
In terms of healthcare, companies need to re-focus on providing access in both the host and home locations. Especially in times of a pandemic, expat families need the flexibility to return to their home country within days and a local health insurance is mandatory. In addition, telemedicine services are booming in times of social distancing and should be added to the expat health packages.
#3 Well-being: putting the human into expat management
The pandemic is a challenge for each one of us and is affecting our well-being. Relocation in times of uncertainty demands a lot of employees’ resilience, with work–life balance having been thrown out of the window for many of us.
Companies need to improve their work on topics such as burnout and family support. The happiness of the whole family is influencing the assignment’s success. While companies have been aware of this fact for a while now, the current crisis will increase the importance of well-being support aspects within the expat package.
However, it is worth noticing that the human perspective is not only important as a result of the pandemic. Even before the pandemic hit, we have been living in a rapidly changing environment motivating companies to focus more on the well-being of the individual in order to secure performance.
Here, I quote an extract from the prologue of the Deloitte Human Capital Report 2020 (PDF) that was issued before the outbreak of COVID-19. When reading the following sentences it all feels just too familiar to the world we are living in today: “The world today looks remarkably different from the one in which we launched the first Global Human Capital Trends report in 2011. The past decade has been marked by radical change, by a ‘newness’ that has evolved at a pace that can only be described as exponential. Technology invaded the workplace at a speed that would have been unimaginable a decade prior. Workforce demographics shifted substantially, with five generations in the workforce, a decline in working-age populations in many advanced economies, and an increase in the focus on equality for all workers as it relates to pay and treatment. And as the workforce evolved, so did worker expectations – with calls for organisations to do more to help improve individuals’ lives, address societal problems, mitigate technology’s unintended consequences, and act equitably and ethically.”
Mercer has seen an increase in utilisation in EAP (Employee Assistance Program) services since the COVID-19 outbreak. Global Mobility Wellness Services focusing on mental well-being are more in demand than ever. Currently, there are about 2.6 billion people under some kind of lockdown or quarantine, with 7 out of 10 people feeling nervous, anxious or on edge and 4 out of 10 people stating that they feel depressed (according to Mercer, Pewresearch.org). To offer the right service and raise awareness on this topic, an improved employee communication will be necessary.
#4 Tougher legal restrictions
The immigration and work visa process was a challenge before COVID-19 but since the outbreak, longer waiting times and an increased administrative effort are expected. Countries are more hesitant to offer long-term visas for accompanying spouses or even the employee. Borders are closed overnight to limit the spread of the pandemic. While many of the restrictions may be temporary, they will have most likely a lasting impact on the mobility of people between countries for the foreseeable future.
Mandatory quarantine orders, temporary suspension of existing visas, entry restrictions from certain high-risk locations, and the introduction of heightened application requirements for visas are not only expected but already a reality. Ernst & Young has therefore introduced a mobility tracker to check which regulations are valid for what country during the turbulent times we are living in right now.
Resilience of the individual expat is a key skill to thrive abroad like never before
#5 Need for improved employee communication
The current pandemic means there is a need improved communication within the company but also with stakeholders. The global mobility expert Mercer recommends asking the following questions to face the situation:
- How is COVID-19 affecting your organisation?
- How have mobility and talent priorities shifted?
- What concerns do assignees have?
- How can your organisation and mobility programme respond expediently to these concerns?
During the first couple of months of COVID-19, companies focused on managing trust, uncertainty, the overall assignee well-being and managing the expat packages to respond the developments. Today, most companies are redeploying assignees and engaging with stakeholders on changed priorities with respect to mobility programmes and policies, as well as reviewing medical and safety aspects of the packages. Mercer predicts for 2021, that companies will focus on introducing a truly digital mobility experience for all stakeholders, focus on assessment of assignee experience and build more resilient expat programmes, including new types of mobility such as virtual assignments.
Key point that still needs addressing
While all these are valid starting points for improvement, there is one factor that has been missing out potential even before the pandemic, which involves the HR department.
The communication between the expat family and the HR department has been criticised in almost every study and paper you can find on the topic. Sending people abroad is a highly personal matter and is not addressed only by spreadsheets and contracts. Employees are increasingly asking for more personal contact with someone who knows how it feels to live abroad. Expat spouses are demanding more support and help with their very own professional challenges. It will be interesting to see how companies will respond to these demands.
No matter from what angle you look at is, the pandemic will force international companies and the whole global mobility industry to reflect and act on the status quo.
More forms of expatriation will arise, more flexibility by the cooperations is demanded, and the resilience of the individual expat is a key skill to thrive abroad like never before.
First published on Share the Love.