🦜 PerchPulse - The USA Market Update September 2023 🦜

A warm welcome to the September issue of PerchPeek’s US Market Monthly update! 

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Here’s where you’ll find the hottest updates around employee relocation and international talent strategy, insights from our experts on housing and cost-of-living news affecting your staff, the latest trends in global mobility, and tips and tricks on ways to support your teams.

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A fly-by summary

• More and more US business leaders and politicians calling on White House for urgent immigration reform to tackle ongoing skills shortage - key knowledge for GM leaders
• Consumer inflation is at 3.2%, almost lowest level since March 2021, plus top 10 most expensive US cities in terms of living costs, and tips for supporting relocating employees
• Rental prices nationwide are up +3.6% YoY, with the highest increases in the Northeast and Midwest, according to Zillow report - latest rental stats and trends for HR leaders
• It’s a great time for deals on furniture, from Labor Day sales to end-of-summer clearance events - PerchPeek’s top 10 furniture shopping tips to share with relocating employees!

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Talent strategy: More and more US leaders calling for urgent immigration reform to tackle skills shortages - important knowledge for GM leaders

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As the US labour shortage continues to worsen, more and more leaders are calling for urgent immigration reform to recruit workers from abroad and fill skills gaps. Here are the latest details for HR and global mobility leaders dealing with employee immigration to keep up-to-date.  

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In our last issue we reported that Sam Altman, CEO of OpenAI, was the latest business leader to call out the need for immigration reform to help embrace the highly skilled workers keen to live and work in the US, calling it “one of the easiest policy wins I can imagine”.

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Now, other leaders across the country are also calling on the White House to overhaul the current work permit system as a way to fix the current labour shortage.

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What’s the extent of the US labour shortage?

• The U.S. Chamber of Commerce reports there are nearly 10 million job openings but only about 6 million Americans looking for work

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Key quotes from US leaders

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• “We need the national government to stand up.” - Eric Adams, New York City Mayor
• “We have the jobs. We have the people. We just need authorization from Washington.” - J.B. Pritzker, Illinois Governor
• “We’re at a crisis. We’re hearing that the application for asylum and work permits are taking up to a year to four years.” - Rebecca Shi, Founding Executive Director, American Business Immigration Coalition

Source: WLNS.com

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Response and latest updates

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The Biden administration claims not to have the authority to speed up the work permit process; this could only be changed by Congress, as it is established under immigration law.

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However, in the absence of action from Congress, the White House has announced plans for a national campaign to get more eligible individuals signed up for work authorisation in the US.

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PerchPeek insights

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With more and more leaders, in the worlds of both business and politics, calling for immigration reform as the only real way of counteracting the US labour shortage, it does suggest that the message is starting to get through. However, any tangible reform still feels some way away, and in the meantime, the risk is that top talent from overseas will choose other countries instead.

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The most important thing that People Leaders can do to have influence on effecting real change is to keep submitting work permit applications for skilled workers from abroad. This will be a clear demonstration of the high level of demand, and will keep pressure on the establishment!

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Cost of living: Consumer inflation at 3.2%, near lowest level since March 2021 - key cost of living data, with city-by-city breakdown, for GM leaders

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Though inflation is finally falling, many people are still struggling with the cost of living, and where a person lives of course makes a massive difference. Here we’re sharing the key data points from a new city-by-city cost of living index, providing important context for HR leaders.

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Following a tough couple of years where living costs have skyrocketed, inflation in the US and around the world is finally starting to fall. According to the US Labor Department, consumer inflation was at 3.2% for the 12 months to July - almost the lowest since March 2021.

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However, this is just a national average, and of course a large majority of workers in tech and other private industries will be based in areas where the cost of living is far above the average.

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The Council for Community and Economic Research has published a new Cost of Living Index, measuring price differences in 271 urban areas. The study looked at six price categories: housing, utilities, groceries, transportation, health care and miscellaneous goods or services.

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So how do US major cities and metro areas measure up?

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Here are the top 10 most expensive urban areas according to the Index:

1. New York (Manhattan): +122% higher than average
2. Honolulu: +79%
3. San Francisco: +70%
4. New York (Brooklyn): +59%
5. Orange County, California: +50%
6. Los Angeles (Long Beach): +49%
7. Washington, DC: +49%
8. Boston: +48%
9. Seattle: +45%
10. San Diego: +43%

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PerchPeek Top Tips

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One of the tradeoffs of living in the hustle and bustle of the USA’s biggest metropolises is, of course, paying over the odds for the privilege! Here are PerchPeek’s top five pointers for supporting relocating employees based in the most expensive areas for cost of living.

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• Cost of Living Adjustment (COLA) - Where possible, offer compensation or benefits to match elevated expenses of high-cost cities, regularly reviewing COLA rates
• Financial Education and Counselling - Look into providing resources and workshops on budgeting, saving, and debt management, promoting informed financial decisions
• Housing Support - If you can, assist with housing challenges through relocation packages, temporary housing allowances, and guidance on affordable options
• Flexible Work Arrangements - If possible for your organisation, promote remote work and flexible hours to reduce commuting costs and enhance work-life balance
• Employee Assistance Programs (EAPs) - Provide EAPs offering confidential advice for personal and financial issues to help employees cope with stress and challenges

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Home-finding: Rental prices up +3.6% YoY, with highest increases in Northeast and Midwest - latest rental prices and trends for HR leaders

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Property platform Zillow has released a new report showing the latest rental price trends for the US as a whole and looking at particular metro areas, and it’s super important reading for HR and global mobility professionals! Here are the highlights to share with relocating employees.

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Current rental price growth

• The typical asking rent nationwide is $2,062, a +3.6% increase on one year ago
• This continues a steady, 17-month-long slowdown in the annual rental price growth rate since hitting a record-high +16.2% in February 2022
• These prices have risen +0.5% month-over-month, very slightly faster than the +0.4% June-July MoM growth rate seen on average between 2015 and 2019

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Source: Zillow.com

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How does it look in certain metro areas?

• Annual rent growth was highest in the Northeast and Midwest: Hartford (7.0%), Providence (6.5%), Boston (6.5%), Chicago (6.0%), and St. Louis (5.7%)
• The slowest year-over-year rent growth is mainly in the west - rents are down -2.3% in Las Vegas and -1.8% in Austin, and have increased the least in Phoenix (0.1%), Seattle (0.5%), and San Francisco (0.6%)

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What’s the prediction for the rest of 2023?

• This point of the year usually brings a sharp slowdown in monthly rental price growth - it typically slows in late summer and may even turn negative in October and November
• The vacancy rate in rental accommodation has also begun to increase rise, from its lowest levels in almost 30 years, suggesting that competition for units may calm down
• However, hopeful property buyers are facing extremely high mortgage rates of up to 7%, which indicates they may need to rent for longer than desired, affecting rental stock

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How to help relocating employees find a home

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• Offer advice on the best property search platforms to use, such as Zillow.com, Realtor.com and Apartments.com (voted ‘Best for Renting’ by Investopedia in 2023)
• Provide guidance on using these platforms e.g. using filters effectively, and advice on suitable neighbourhoods that combine affordability with a decent commute to the office
• Speed matters! Help with setting up alerts so employees can jump on the hottest listings as soon as they’re posted, and offer flexibility when it comes to attending viewings!

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Support your talent: PerchPeek’s top 10 tips for great deals on furniture, to share with relocating employees furnishing their new US home!

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As we enjoy the last of the summer days and get ready to welcome the fall, September feels like a fresh start for many, with students moving into dorms and many workers relocating over the summer. As a result, it’s a great time to snap up deals on furniture, and for HR professionals supporting relocating employees, this information should be super useful for your teams!

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Here are PerchPeek’s top 10 tips to share with relocating employees looking to furnish their new home without breaking the bank, by snapping up the fantastic deals and bargains out there! 

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• Labor Day Sales / End of Summer Clearance Events - Employees should look out for Labor Day weekend sales and clearance events, both in-store and online. Furniture stores often offer significant discounts during this time!

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• Back-to-School Promotions - In a similar vein, many retailers run back-to-school promotions throughout September. These sales often include budget-friendly furniture items suitable for apartments and smaller living spaces - deal for relocators!

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• Online Marketplaces - Advise employees to check out online platforms like Craigslist, Facebook Marketplace, and OfferUp to find secondhand and discounted furniture. And encourage them to inspect items thoroughly, and negotiate prices where appropriate!

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• Outlet Stores - Suggest visiting furniture outlet stores, where brand-name furniture is available at significant discounts. Outlet stores are a valuable resource for quality, budget-friendly furnishings. Note: this will be a lot easier for those with access to a car!

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• Thrift Stores and Consignment Shops - Highlight the potential of local thrift stores and consignment shops as sources for unique and affordable furniture. Employees should consider making periodic visits to discover hidden treasures!

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• Estate Sales - Make employees aware of estate sales in their area. These sales often feature high-quality, gently-used furniture at a fraction of the original cost. They can find listings in local newspapers or online in local Facebook or other community groups.

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• Flash Sales and Newsletters - Suggest subscribing to email newsletters and following furniture retailers on social media to stay informed about flash sales and exclusive discounts. These opportunities can lead to significant savings, but require speedy action!

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• Price Comparison Tools - Encourage employees to use price comparison websites and apps, such as Google Shopping and PriceGrabber, to identify the best deals on specific furniture items across various retailers and make informed, cost-effective choices!

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• Warehouse Clearance Sales - Recommend keeping an eye out for warehouse clearance sales, where employees can find deeply discounted furniture pieces. These sales are ideal for acquiring quality furniture at lower prices.

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• Local Classifieds and Garage Sales -  Advise employees to check local newspapers and online classified ads for garage sales and moving sales. These events often offer budget-friendly furniture options, particularly from individuals looking to downsize.

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By sharing these tips, global mobility leaders can guide their relocating employees effectively in their quest to secure budget-friendly and quality furniture for their new homes in the USA!

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We hope you enjoyed this month’s update! 

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If you have any feedback, comments or questions about what's happening in your location, feel free to reach out via the form at the bottom of this page.

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Thanks for reading, and see you next month!

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