Canadian companies are on the move, racking up relocation costs of about $1 billion every year.

And Vancouver, already experiencing an economic upswing, is enjoying corporate relocation vigour from businesses already in the market.

"There have been some relocations into Vancouver but it's more an expansion of (existing) firms," says Ken Veldman, director, business development for the Vancouver Economic Development Commission. "It's more of 'where are we going to put our next plant?'" One recent example is H3 Energy, a Vancouver-based Mitsubishi spinoff in the fuel-cell sector that is utilizing hydrogen generation technologies.

Across Canada, as many as 110,000 employees per year can expect to find themselves at a desk in another town or city, with companies dipping into their pockets to pay as much as $40,000 per move per staff member, according to a newly-released report on how corporations are handling employee mobility.

Jim Lockington

On average, Canadian businesses are spending $20,000 to move a single employee to another location in the country, says the Emerging Trends in Employee Mobility Report, released last month by Royal LePage Relocation Services (RLRS).

Overall, relocation sector growth areas in the Vancouver region centres around traditional resource strength, like forestry, says Veldman, while transportation is also strong.

The RLRS survey of 100 Canadian-based companies also found that large businesses - those with more than 1,000 employees - are the ones that typically spend at the $40,000 level.

Meanwhile, operations with more than 100 staff members and multiple locations account for approximately 40,000 relocations a year in Canada, dishing out $800 million on employee mobility.

But while those numbers may sound impressive, RLRS president Jim Lockington says big business is not as generous as it once was when it comes to relocations, especially for mid-level staff.

"On a general basis, companies have cut benefits dramatically in the last five years," says Lockington. "The offerings vary tremendously by company and they can vary tremendously within a company - different companies have a different willingness to pay for different benefits. Many corporations are just very focused on cost cutting in order to compete with companies elsewhere and their offerings have been slimmed down in the last couple of years."

As an example, Lockington points to the Toronto real estate sector, where in the early 1990s a corporate guarantee was required to ensure that the employee's home would be sold. Today, he says, that guarantee is no longer there as the marketplace has changed.

Other changes include a move to lump sum benefits - giving the employee a lump sum to handle the relocation costs - or employee reimbursement, where the person is reimbursed for the cost of doing his/her own relocation work.

Executives or those in strong demand due to skill shortages, however, still tend to get the better relocation packages, says Lockington, noting many have a propensity to negotiate a better deal.

To compensate for thinner relocation offers, RLRS thought employees might want to pay for additional service options on their own. "But we just haven't seen a demand at all," he adds. "For the most part, they're cash-strapped when they're moving and they're trying to manage their dollars frugally. Usually, the answer is, 'I'll do it myself.' " Corporate relocations, which have slumped since the 9/11 terrorist attacks in 2001, are now starting to stabilize.

"The number of relocations has been on the decline then 2001 - coinciding with the 9/11 hit, which we haven't fully recovered from - probably by about 30 per cent in North America. It's starting to rebound a little but nobody expects it to go all the way back," says Lockington.

"What we're seeing is that corporate moves are probably stable at this point in time," adds Stephen Cryne, executive vice-president of the Canadian Employee Relocation Council (CERC), A trade association that addresses issues that impact workforce mobility, CERC is in the process of putting together a new membership survey - a process done every two years. Nevertheless, Cryne says that from talking to people over the past year, "the general sense is that there has been a pickup in business."

At Re/Max Relocation, Re/Max's division to assist corporate moves, the perspective for the future is also positive.

"Our corporate transfer volume was up about 10 per cent last year, after three years of declining volume," says Laurie Marsh, vice-president for Re/Max Relocation. "The volume decreases of the previous three years and the increase last year were not industry specific. Oil and gas, financial services and retail have been very active sectors for us for the last year."

One trend that Cryne is seeing is a shift to temporary relocations as opposed to a permanent move.

"There's more of a move to assignments that run from three months to 24 months, they (companies) are not relocating people on a permanent basis," says Cryne, citing cost implications and the flexibility temporary relocations provide to both the company and the employee.

Cryne's data corresponds with the RLRS survey, which shows that these short-term assignments have increased in popularity over the past three years and are expected to continue to grow during the next three years. RLRS numbers indicate that temporary assignments accounted for about one in five employee transfers.

Cryne notes that family issues are also playing a larger role in employee relocations.

"One of the things we found in our survey (in 2003) was the importance of family," he says. "It is much more important in the decision-making process than it used to be in the past."

"There are more females in the workforce today in management roles - I think that's one of the driving reasons and it encompasses education for children, access to a good school, quality of housing and quality of life."

(Laura Severs can be reached at laura@businessedge.ca)