Relocation rate of job seekers falls to 4.2% amid COVID-19: RPT

Andrew Challenger, Vice President of Challenger, Gray & Christmas, joins Yahoo Finance's Kristin Myers and Melody Hahm to discuss the latest job trends amid COVID-19.

Video Transcript

- Well, this pandemic has changed how and where people work as employees choose to relocate as they worked from home throughout this pandemic. We're joined now by Andrew Challenger, vice president of the job search firm Challenger, Gray, and Christmas. And we also have Yahoo Finance's Melody Hahm here us as well for this conversation.

Andrew, I would love to start with you here, because it feels as if we repeatedly talked about how workers were moving to new cities so that they could work from home throughout this entire pandemic. But it seems that your study is really showing that that relocation that everyone thinks really has been boosted and is going to continue is really starting to crater. Why do you think folks are kind of starting to stay put now?

ANDREW CHALLENGER: Yeah, I think early in the pandemic we saw a big spike in relocation as people were either forced to move because the area of the country they lived in didn't have any jobs available as companies were getting used to hiring during a pandemic, maybe they stopped altogether. And so they had to move to other cities to find employment at all. But since then, in Q3, and what we expect to see in Q4, is that relocation's have really fallen as companies have gotten used to allowing workers to work from home.

So because of the new technology, because of a company's ability to allow people to work from home, a lot more people are finding work where they live, maybe working for companies outside of their home, city, or state, but not having to move for those roles.

MELODY HAHM: Andrew, you're just thinking about the slate of companies, whether it's the Facebook's, Microsoft, Stripes that have all said they would actually adjust pay lower for employees who are moving to cheaper cities, or perhaps outside of the city. Do you anticipate this becoming a new phenomenon where, yes, maybe larger corporations will allow this mobility, and as you say, possibility to work from anywhere, but you may suffer the consequences with a lower paycheck?

ANDREW CHALLENGER: Yeah, I think that's one way companies are starting to think about how they're going to adapt to a new world where people are more used to working from home. I think a lot of companies like this idea of giving their employees the autonomy of choosing when and where they're going to do their work. But like a couple of those big name tech companies that you named-- Facebook and Google-- those are companies that over the last 10 years have spent unbelievable amounts of money building tech campuses in expensive places like Silicon Valley, with the idea that having people stay at work for longer hours by providing them lots of amenities so they don't necessarily have to go home was good for productivity, was good for collaboration. They've got a lot of sunken costs and invested interests in keeping people in the office.

So while they're open to people moving to other locations in the country, they are certainly considering pulling the salaries down in accordance.

MELODY HAHM: And Andrew, this may be more of an existential question, but just thinking about your firm Challenger, Gray, and Christmas, of course it's one of, I think, maybe the first global outplacement firm based here in the United States. What kind of demand are you seeing. Are you seeing more and more interest especially for some executive roles? Are there actually openings available for folks to be sweeping up at this time? Or do you feel like it's been pretty much at a standstill over the course of 2020?

ANDREW CHALLENGER: Yeah, our company works with people that have been let go and companies that are going through layoffs. So it's been a tidal wave year for our company-- really busy as lots of companies have had to lay people off and make changes. But that doesn't mean that there aren't still opportunities. There are areas and segments of the economy that are hiring. We're seeing our job seekers land at a reasonable pace clearly below what we saw over the last five years when the labor market was really tight.

But people are landing in positions. What's changed is it's being done completely remotely. We are seeing C-suite level clients that are being hired on to lead organizations, go through a hiring process where they never meet a single individual face to face. And so the way people are being brought into organizations has changed really dramatically. And that might not change for some while.

- Well, hopefully there will be much better news for 2021 for some workers than there was in 2020. Andrew Challenger from Challenger, Gray, and Christmas thank you so much for joining us. And of course, thank you to Melody Hahm for popping into the 1:00 PM hour a little bit early. I know everyone's going to be seeing you a little bit later on. But thanks for joining us today.