What are the most important household goods in your life? How much does it cost to move those goods to a new location? These are some of the questions facing relocating employees. In some cases, relocating employees may have little to ship, which can be helpful in an age of rising shipping costs. Moving household goods (e.g., furniture, appliances, computers, etc.) can cost several thousand U.S. dollars up to tens of thousands of dollars when being shipped internationally.
Household goods policies can ensure that relocating employees successfully hit the ground running at their new locations. Mark Waller, CRP, PHR, SHRM-CP, vice president and general manager at A-1 Freeman North American Inc., and Cathy Ware Partridge, CRP, GMS-T, director for global relocation business development and client services at Interstate Relocation Services, shared their insights regarding shifts in household goods policies and how demographic changes have informed those policy changes.
Impact of Workforce Demographics on Household Goods Policies
Millennials and Generation Z employees often choose to rent their homes and seek out smaller living spaces. Employees’ choices are impacting household goods policies because many are looking for greater flexibility. “As a result, policies have evolved to include more modular support options, such as partial shipments, storage, new furniture stipends, or lump-sum allowances, rather than traditional full-pack household goods services,” Waller says.
A good rule of thumb is for companies to craft household goods policies based on their employee population. By 2030, more than 70% of the workforce will be either millennials or Gen Zers, and companies need to account for their needs.
“About 20 years ago, companies would have shied away from containerized shipments for relocations because of the expense,” Partridge says. “But now, with smaller shipments, companies are providing employees with greater flexibility.”
Household goods policies have started to provide a certain amount for shipments, but in some cases, employees ship less and don’t use the full amount of their household goods benefit. “I’ve seen fewer changes to policies and more changes in how relocating employees utilize their allowances,” she adds.
Partridge recommends that some employers consider weight-based household goods policies that provide equity for all employees. For instance, someone moving to Washington, D.C., from California is going to have higher shipment costs than someone moving from New York City to Washington, D.C., with the same size shipment. Weight-based allowance provides cost control measures while providing the same benefits equally across their policy or tier. “I’m seeing more short-term assignments among relocating employees,” she says. “These temporary relocations are shipping additional baggage, but not a household goods shipment. In some instances, these temporary relocations may receive an air shipment to support them.”
Other factors influencing household goods policies include travel distance to the new location, the employees’ roles, relocation duration, and the size of their family. According to Waller, “Senior-level employees or those relocating with families often still use traditional household goods services, while younger or single employees tend to prefer flexible or cash-based options that allow them to manage the move themselves or purchase items at their destination.”
Even when employees relocate internationally, household goods policies are shifting. Some transferring employees are seeking out rental furniture services, while others are looking for furnished apartments or homes. “Companies are offering enhanced destination services like home-finding and settling-in support instead of full household shipments,” Waller says. “I routinely see numerous shipments of one or two lift vans (500 pounds to 2,000 pounds) at both the origin location and destination, which is much smaller than in years past.”
Impact on Logistics, Moving Providers, and Relocating Employees
When demographics and other factors influence household goods policies, those changes will impact supporting industries, such as freight companies and movers. With shipments shrinking, some moving and logistics providers are emphasizing their ability to provide faster shipments, as well as offering storage solutions. According to Waller, “Some are offering digital move coordination services, and many are partnering with rental or resale companies to meet employees’ needs.”
With more relocating employees taking stock of their own household goods, some have opted for minimalism. “Rather than collecting family heirlooms, millennials and Gen Zers are choosing lighter-weight furniture over their grandmother’s dresser made of cherry wood, which decreases the cost,” Partridge says. She adds, “They also are choosing to leave behind fine China and other goods they may not use or find practical.”
Shipments are moving away from grandfather clocks and antiques to include only the household goods and essentials used to care for the family in a new location. Lighter-weight furniture also brings down shipment weights. Relocating employees are choosing their shipments more carefully.
Despite these declines in shipment weights, the costs of shipments have not followed suit. In fact, Waller says, “Costs have skyrocketed compared to what they were before the pandemic, and part of that is due to tariff pricing, labor and insurance costs, and inflation in some regions. Any savings in shipment costs are offset—and then some—by these increases.”
In cases of domestic shipments, many moving companies are still facing a shortage of available drivers. “Household goods drivers basically have their own small businesses with customer service, payroll, and human resources concerns, as well as their own expenses related to fuel costs and logistics. Non-household goods, Class A drivers don’t have that responsibility and frequently return home each night, which is more attractive to new drivers choosing which route to take.” Partridge says. “Additionally, shipping containers with household goods may get bumped from ships in favor of higher priority items, which can cause even more timeline hiccups.”
For the international relocation process, many factors influence shipment costs, including delays related to weather or policy changes. “In some regions, shipments may be interrupted, rerouted due to global conflict, or could even be seized by pirates,” she adds. A recent BBC article indicated that cargo ships are being rerouted away from the Red Sea and Suez Canal to sail around the southern tip of Africa to avoid Houthi attacks. Recently, the International Chamber of Commerce found that in 2023 that maritime piracy and armed robberies had increased to 120 such incidents.
More companies are using digital tools to track, manage, and streamline shipments. “I’ve seen cases of employees throwing digital tags into their shipment so they can track it themselves,” Waller says. Managing their own relocations through digital platforms provides them with a sense of peace about the process, because they can track their shipments in real time. Companies, too, are offering managed self-service relocation models, which combine technology independence with optional support.
“This hybrid approach aligns with younger workers’ preferences, reduces costs, and enhances flexibility within corporate mobility programs,” Waller says.
Set Expectations Early for Better Outcomes
Employers that communicate the established parameters of the relocation program and potential shipment timelines and delays will often have more satisfied employees during relocation. “Many companies offer email and digital updates about the process,” Partridge says. “But beyond updates and program parameters, companies should consider providing as much support as they can to relocating employees, because ultimately, those employees should be hitting the ground running in their new role.”
Having those conversations with employees and their families about what goods they will need when they relocate and providing them with some insight into what items could be stored or resold can speed up the process.
“Employees value choice and flexibility. They like to be able to choose between full-service relocation, partial shipments, lump sums, or a hybrid approach,” Waller says. “Other valued features include real-time shipment tracking, short-term storage, eco-friendly solutions, and support services that reduce the stress of relocation, such as digital planning tools or relocation consultants.”
Packing and unpacking services are another big item for most relocating employees. “Getting to know the talent at the company and what they need from a relocation program shows them that their employer cares about them,” Partridge says. Understanding an employee’s needs during the relocation process can go a long way in providing them with flexibility and reducing their stress.
Other relocating employees are reducing their household good shipments and relocation costs by selling or donating a lot of their household items before moving to another location. Some consider this an eco-friendly way to relocate. “I’ve seen a number of transferees sell items and use the money to purchase new items once they are relocated,” Partridge says. “I’d like to see more employers consider partnerships with existing programs to help relocating employees donate or sell their items. These kinds of benefits would also help employees make quicker decisions on what they really need in the new location.”
When Lump Sums Make Sense
Lump sum or cash-out payments could be another option for some relocation programs. “Early-career employees or those relocating domestically prefer cash-out or lump-sum payments to purchase furniture at the new location or to secure short-term furnished housing,” Waller says. “In some cases, relocating employees will use those payments to cover moving truck expenses.”
Lump sum or cash-out payments are easier for some companies to administer because the program establishes the maximum sum for covered relocation expenses and outlines what those funds can be used for in the relocation process. Young professionals like lump sums because they can provide them with greater control over their relocation experience, Partridge and Waller say. These employees are able, within certain criteria, to use the funds the way they want and prioritize their own needs throughout the relocation process. This could be finding a furnished home, or it could be paying for moving services.
“Some college graduates who are relocated will drive to their new location and use the payment for fuel and hotel expenses,” Partridge says. Lump-sum policies do not always work as well for more seasoned employees who have more complex relocation requirements.
Ultimately, each relocating employee wants control over how long the process of shipping household goods takes. Household goods policies need to not only address how much an individual employee wants to take with them but also how household goods are managed, and whether other options, such as renting furnishings for global assignments, are preferable.
Household goods policies need to be applied fairly to all relocating employees, but at the heart, household goods policies and relocation policies can reflect that the employer cares for staff by providing them with benefits that reflect their needs and provide enough flexibility and control.