2013 Report: Relocation Rises as Housing Stabilizes
The percentage of job seekers relocating for new positions climbed to its highest level since 2009, as rising home values and the improving job market made it easier to pull up stakes. Increased mobility among job seekers could help accelerate the recovery and provide relief to some employers struggling to find local talent, according to global outplacement and coaching consultancy Challenger, Gray & Christmas, Inc., which released the report on relocation Thursday.
An annual average of 13.3 percent of job seekers moved for new jobs in 2013, according to a quarterly survey conducted by Challenger among those successfully gaining re-employment. The 2013 average was 36 percent higher than the 9.8 percent relocation rate averaged in 2012. In 2011, the quarterly relocation rate averaged just 7.6 percent.
The relocation rate, which is based on a quarterly survey of managers and executives finding employment, tends to fluctuate significantly from quarter-to-quarter. However, the four-quarter moving average, which smooths out the volatility, also shows a rise in the percentage of job seekers moving for new positions. In the fourth quarter of 2013, the moving average increased to 13.3 percent from 11.1 percent in the first quarter. The latest reading was up 37 percent from a year ago, when the moving average stood at 9.8 percent in the fourth quarter.
“Relocation is rarely the most desirable option for job seekers. There is a lot of cost and risk involved. The collapse in the housing market, which was a primary factor behind the recession, made relocation even more unattractive, as many job seekers were stuck in homes with market values well below what was owed on the mortgage. In 2013, we saw a rebound in home buying and home prices. Fewer mortgages are ‘under water,’ which is making it easier to move,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
A recent report from the National Association of Realtors indicates that a majority of metropolitan areas experienced strong year-over-year gains in home prices in the fourth quarter of 2013. Nationally, the median price for single-family homes increased 10 percent in the fourth quarter to $196,900, compared to $178,900 a year earlier. The Association reports that one in six metropolitan areas have seen their housing markets return to pre-recession conditions. Meanwhile, RealtyTrac, a leading source for comprehensive housing data, indicates that foreclosure activity in 2013 fell to its lowest level since 2007.
“All of this is good news for the job seeker who can greatly increase his or her chances of finding employment by expanding the search beyond the local market. There are definitely regions of the country that are recovering faster than others. Certainly the 78 metropolitan areas where unemployment was below 5.0 percent as of December represent a great list of cities to explore when one is willing to consider relocation,” said Challenger.
The list of low-unemployment-high-opportunity cities expands every month. The number of metropolitan areas with unemployment rates below 5.0 percent, which reached 78 in December, stood at just 29 in June.
The lowest unemployment in the country in December was Bismarck, North Dakota, where only 2.8 percent of the available labor force is out of work. The job boom is due to the rapidly expanding energy industry, which is also fueling job growth in construction, retail, transportation, etc.
The list of cities with low unemployment rates, as well as the opportunities available in those cities, varies greatly. Just some of the cities with sub-5.0 percent unemployment include Springfield, Missouri; Austin, Texas; Oklahoma City; Washington, DC; Boulder, Colorado; and Gainesville, Florida. There are another 93 cities with an unemployment rate between 5.0 percent and 6.0 percent, including Tampa, Florida; Indianapolis, Indiana; Nashville, Tennessee; and Seattle, Washington.
“In areas with unemployment below six percent, it is likely that many employers are having a difficult time filling open positions with locally available talent. Moreover, many of the areas experiencing low unemployment also enjoy a lower cost of living. Job seekers should not assume that the industry driving the growth in these areas is the only one hiring. One strong industry can lift the other sectors in that area, including health care, education, business services, and so on,” said Challenger.