A majority of employers are reducing expat relocation bonuses

Employers are still under pressure to cut expenses for expat assignments, according to Brookfield Global Relocation Services2011 Global Relocation Trends Survey. 75% of companies reduced expat assignment expenses (perks such as relocation bonuses and hardship allowances), with 56% of respondents reporting increased pressure to cut costs compared to last year.

As Linda Wang observed in a recent article for Chemical & Engineering News:

Not that long ago, chemists on expatriate assignments to China could expect to stay for three to five years, helping their company establish a plant or a research facility there and training the local talent to assume leadership roles. These expats often received generous compensation packages including salary increases, housing subsidies, and private education for their children.

The Great Recession, which lasted from December 2007 until June 2009, forced companies to scale back on these assignments and rethink their expat staffing strategies. Now, as the economy struggles out of its slump, companies are resuming their global expansion plans, and international assignments to China and other parts of Asia are cropping up once again. But they are coming back with far fewer perks.

Surprisingly, though 86% of employers made cost estimates prior to creating international assignments and 67% tracked costs during assignments, only 25% actually compared the two when the assignments ended. They would do well to keep better records–economic risks in the US and eurozone aren’t going away any time soon. Similarly, expats are unlikely to see their financial perks return to pre-recession levels.

As Linda Wang observed, incentives to work abroad may now shift from the financial realm to professional development.