Offering de-location benefits is the next step
Reimbursing employees for relocation costs has become a benefits package staple. Benefits can range from core (i.e. the initial house-hunting trip, the rental fees for a moving truck and an incidental expense allowance) to more expansive packages that include flexible add-ons such as home purchase aid, job search assistance for trailing spouses, school tuition and even temporary pet boarding.
Now, there’s a new trend emerging in today’s increasingly mobile world – helping companies hire the best talent in the world, as well as pique the interest of the emerging millennial generation: de-location.
What is de-location?
Simply put, a de-location package provides monetary assistance to an employee who wants to move to a new area.
De-location is a relatively new concept. Earlier this year, tech startup Zapier stirred up a buzz for its decision to forgo overhead and remain office-less. While Zapier’s employees come from – and work from – anywhere, the company specifically wanted to attract tech stars in the greater San Francisco area, knowing that many of the Silicon Valley’s top tech prospects are looking to settle long term in a more affordable place.
Zapier founder Wade Foster recently blogged about their new practice. His post was later picked up by Inc.’s Sonya Mann. Zapier offered employees a persuasive de-location package to entice them to continue working in a Silicon Valley-esque job, while living wherever they desire.
De-location: brought to you by expensive cities, like SF
San Francisco has gained a reputation for its high cost of living. In September of 2016, it ranked as the most expensive city in the United States for the third time in the past five years. With median housing costs hovering over $1 million, it’s no surprise that the city is also seeing increased turnover, with a recent study from Joint Venture stating: “People are moving out of Silicon Valley nearly as quickly as they are moving in.”
Meanwhile, other major urban areas like New York City have skyrocketing rent, which helps explain millennials inability to start saving their money.
As the CEO of a growing SF-based startup myself, my executive team and I have begun implementing de-location to sustain talent and increase quality of life. One of our employees who had built his entire career in the Bay Area was recently looking at his long term financial position and getting more serious about saving for future life events. Next month, he’ll be de-locating to Nevada – with a benefits assist from EaseCentral. We’re excited to be able to grow with him as he makes his next move, and we intend to implement this option across the board. Currently, 20 percent of our entire staff works remotely.
De-location: brought to you by the technologies that made working remotely possible
Thanks to growth of conferencing services, instant chat applications and cloud-based collaboration apps, remote work has grown in acceptance over the past decade. New SaaS platforms allow HR teams to onboard employees from anywhere on Earth, and even offer reviews online to keep everything in check. According to the Bureau of Labor Statistics (July 2016), in 2015, 24 percent of those employed (primarily in managerial and professional occupations) already did some or all of their work from home. The trend towards working remotely will only continue as technology advancements make working from home an even more seamless experience.
For millennials, de-location is a rational choice
De-location offers millennials specifically compelling benefits. Not only will it allow them to find a new city with a lower cost living, but as millennials continue to age, we can expect them to increasingly become interested in owning a home, starting a family and, in some cases, even beginning to consider their retirement plan. Moving to an area with more affordable housing per square foot — perhaps even closer to family (a key consideration once kids are in the picture) — makes de-location a rational choice for a generation approaching the next leg of their lives.
For companies, offering de-location packages makes sense, too
Similarly, there are a vast number of advantages that make de-location an attractive addition to their current suite of benefits.
De-location means fewer employees in the office, which cuts down on space rental/ownership. It also spurs an increase in employee satisfaction, which ultimately translates into greater productivity. Plus it’s a novel benefit that can help a company stand out in an increasingly noisy and competitive landscape of startups and tech companies.
Recruiting and training are costly; in fact, research shows on companies spend an average of six to nine months of an employee’s salary to find and train their replacement. Keeping loyal employees happy in their roles is an often overlooked but very powerful tool that can help propel a company’s growth forward - from its ability to reduce and eliminate unnecessary costs, save time and ultimately create loyal employees with a vested interest in the company.
And most importantly, it works
In a recent survey from TinyPulse, remote workers showed increased employee satisfaction across the board. The study also revealed 91 percent of respondents felt more productive while working remotely versus in an office. Additionally, a 2016 study conducted by Gensler shows innovation is higher outside the bars of a traditional office. Time and time again, research shows that the traditional workplace is not the most effective option for many employees.
Now is the time to make the move
While having a home-base or central office likely still makes sense, granting employees the flexibility to work from home - whether on occasion or through de-location – enables companies to attract and retain talented employees. Plus, scheduling occasional meetings in a central location is a great way to plan for a productive day or two together (because we all know too many meetings has a reverse effect.)
Innovation in the benefits space is a rapidly emerging space, spanning assistance with student loan repayment, sabbaticals, flexible hours, gym compensation, pets being allowed in offices, wellness programs and more. De-location may be the latest benefit to join the bunch, but it is quickly proving to be more than just a flashy PR stunt – it’s a smart business tool that can be utilized for attracting and retaining an emerging generation of top talent.
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