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Trends In International Moving Terry R. Head President – International Association of Movers

Explore the latest trends in international moving, including housing markets in the USA and UK, expat data, and the state of global economies.

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Trends In International Moving Terry R. Head President – International Association of Movers

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  1. Trends In International Moving Terry R. HeadPresident – International Association of Movers

  2. Who / What is IAM? • The largest international trade association & advocacy group for household goods forwarders, movers, removal companies, logistics & service providers • Membership includes 2,400+ companies & individualsin more than 170 countries and territories • Founded in 1962 to represent the interests of military TSPs (Transportation Service Providers); scope broadened to include commercial business in 1970s • Annual Meeting and EXPO is world’s biggest & best networking opportunity for business development in moving industry

  3. IAM and Its Affiliates

  4. Is FLAT the New UP?

  5. United States - Economy FLAT seems to be the “New Normal” • USA Economy neither up or down – • Since 2009 Recession - economy has struggled to gain momentum • Growth held back by higher Federal Taxes & government spending cuts • 2013 - USA Economy grew at lackluster 1.9 % versus 2.8 % in 2012 • 2014 projected at 2.4% (recently revised to 3%)

  6. USA Housing Trends ? • Unlimited number of opinions, but common themes; and one thing is certain: In the USA - Housing drives Moving • 2013 – Prices increased by 10.9% - highest level in four years (Median Price up $30,000) • Home sales expected to remain FLAT in 2014 • Inventory UP, with less competition from investment buyers: Is this what drove markets up? • Record low interest rates going away & affordability worsening

  7. Curious Facts About Moving in the USA • Every year more than 45 million people relocate in the USA – (about 17% of population) • On average – 11 or 12 times in a lifetime • About 6.7% move to another state • 50% move due to job change, 33% due to retirement & the rest for other issues • Five years after graduating, 33% of young people no longer live in same state Source: Moving News

  8. Local Move 41 % (Same City) Long Distant 23 % (500+ Miles) Moving to Another 19 % City (Less 100 miles) Regional Move 17 % (Different Metro Area 100-499 Miles)

  9. GREEN = Nobody Lives Here USA Census 2010 – Dark Green Represents Zero Population Blocks

  10. Nobody Lives Here USA Census 2010 – Dark Green Represents Zero Population Blocks

  11. 10 Least AffordableHousing Markets 1. Hong Kong 2. Vancouver 3. San Francisco* 4. Sydney 5. San Jose* 6. Melbourne 7. Auckland 8. San Diego* 9. Los Angeles* 10. London Four USA cities – all in California Source: 2014 Housing Affordability Survey

  12. UK Housing Trends • UK Housing costs set to rise by up to 8% in 2014, with gains in all its countries • Average House price 247,000 Pounds Sterling • A growing imbalance between supply and demand • Estimated UK needs 100,000 new homes a year to keep up with demand

  13. UK Economic & Trade Outlook • Bank of England forecasts UK Economy will grow 3.4% in 2014 (was 2.8% Nov. 2013) • On course to overtake Germany as Europe’s biggest economy within next two decades • Second most successful Western economy after USA; will slip down global rankings (6th) due to Emerging Markets – India, Brazil, Russia • Exports hit record levels – but so have Imports • (UK can’t escape its trade deficit) • Source: Centre for Economic and Business Research (CEBR)

  14. Trends in UK Talent Management • London is Top “HQ” Pick for world’s biggest companies • Two out of Five largest companies in the world with a Headquarters in Europe have it in London (60% of European Companies) • Nearly half of all highly-skilled workers in the top five European business cities are in London • Paris 19% - Berlin 13.7% - Milan 11% - Frankfurt 9.8%

  15. What is an Expat? • Expat: an expatriate person transitive verb • 1. to withdraw (oneself) from residence in or allegiance to one's native country intransitive verb • 2. to leave one's native country to live elsewhere; also to renounce allegiance to one's native country

  16. Expats in the World: The Numbers There were 73 million expats worldwide in the year 1960; that figure now stands at a staggering 230 million Expats make up 3.1% of global population Women make up 49% of expat population There are 6.32 million American expats and 4.7 million British expats living abroad Source: EasyExpat.com

  17. Top Five Destinations for UK Expats • UK now Europe’s Biggest Exporter of People • Only China and India have more citizens based abroad • UK Expats and numbers of British state pensions in brackets: • 1. Australia 1,062,000 (251,000) • Held top spot for past two decades • Stricter Visa restrictions impacting that number • 2. USA 829,000 (140,000) • 3. Spain 808,000 (104,000) • 4. Canada 608,000 (157,000) • 5. Ireland 289,000 (126,000) • Source: inShare Expat Data Tracking

  18. Global Economies Up, Down & All Around BRIC Countries- Brazil, Russia, India & China • Brazil – 4th year of disappointing growth Big fall back to earth after last decade as one of the leading Emerging Markets • Russia –Weaker domestic demand and delayed investment threatening growth Annexation of Crimean peninsula –what’s next? • India – Asia’s third-largest, weighed down by high inflation, weak currency and drop in foreign investment • China- World’s second-largest economy, projected to grow at 7.5% in 2014 versus 7.7% in 2013

  19. MINTS Next Economic Giants? • Mexico – Rapidly developing infrastructure (near-shoring of manufacturing), rising Middle Class, declining poverty rates • Indonesia– 4th most populous after China, India & USA Mixed economy – Private and Public play role Only G20 member to lower debt-to-GDP ratio • Nigeria – GDP 3rd largest in Africa, behind South Africa and Egypt (30th in the world; was 52nd in 2000) • Turkey – 3rd largest growing economy in the world: Construction related industries = 30% of economy Very large consumption base and 3 Auto Manufacturing companies

  20. Why Focus on Trade and Global Economies? Tradeis to Internationalmoving as Home salesare to Domesticmoving

  21. WhyCompanies Move People • Growth of Company • Reorganization / Restructuring • Promotions / Resignations • Knowledge / Skills Transfer • Expansion into New Territories • Budget Constraints • Tax Advantages or Disadvantages • Acquisitions / Mergers Source: Atlas Van Lines – 2013 Corporate Relocation Survey

  22. M & A Generates Moves • Merger & Acquisition activity becoming major reason why companies relocate staff • 63% of USA companies will initiate at least one acquisition or merger in 2014 – 36% as Divestiture • Industries expecting highest number of M&A activity: • Technology, Media, Telecommunications, Health Care, Life Sciences, Pharmaceuticals, Financial Services and Energy • Regions where M&A activity is likely: • USA 56%, Western Europe 29%, China 29%, N. America 27% and Asia (excluding China) 15% • Source: KPMG 2014 M&A Outlook Survey

  23. WHERE will People be Moving toand from? TOP TEN relocation destinations: • United States 6. India • United Kingdom 7. Germany • Singapore 8. Hong Kong • China 9. Japan • Switzerland 10. Canada Source: UniGroup Worldwide UTS Migration Study

  24. Changing Customer Demographics • Younger employees willing to take on overseas postings, particularly in emerging markets • More ‘split-family’ assignments • Many companies combining overseas jobs with charitable projects • IBM – 1,200 employees – 100 projects – 23 countries • FedEx – Global Leadership Corp. works with Peace Corps • Relocation trends showing shorter time periods for international assignments and short-term projects • Probably smaller shipments – Average shipment size dropped from 7,500 lbs to 5,550 lbs. • Dawn of the “NANO-Shipper” (Customer) – Everything they own is smaller / digitized – they just don’t have as much stuff!

  25. Length of International Assignments • 12 Months or less 13% • More than 12 months, less than 3 years 54% • 3 Years or More 33% Source: Atlas Van Lines -2013 Corporate Relocation Survey

  26. In What will People Be Living? With trends for postings to be shorter and for more assignments to emerging markets, what will we see? • Long Termor extended stayhotels/temporary housing • Serviced (semi or fully) furnishedapartments • Rotation in and out of corporate housing • Pre-Packaged Home Furnishings

  27. WHEREare People Moving …or not? • Five-Year Trend (Inter-Country Moves): • USA and UK continue to hold onto first and second place • China is third, followed by Germany • Both countries showing a slowing or flat trend in relocations from USA • Switzerland and Singapore – remain strong due to financial firms rotating staff • India, France and Hong Kong – Gone flat and barely holding onto their previous slots Source: CARTUS, Global Relocation Destination List

  28. What Percent of USA Employees Relocate to Each Country?

  29. The JOBS are Moving! • Re-Shoring & Near Shoring • Reversing 20-year trend of “Off-Shoring” Jobs 3 million Manufacturing Jobs will return to North America over the next 5 years - Wages in China grow 15-20% a year, factor in lead times, shipping & inventory costs, currency fluctuations, etc. - Cost differences will be only 10-15% - Abundance of USA Fuel sources (Natural Gas) for factories - Stable business environments - protect the Brand’s reputation and less civil strife

  30. WHERE is Corporate America Moving IN From? TOP TENOrigin Countries – Inbound USA: • Germany 6. Australia • United Kingdom 7. The Netherlands • Switzerland 8. Japan • France 9. Belgium • China 10. Singapore Source: UniGroup Worldwide UTS Migration Study

  31. Trends in Airfreight • Technology shipments account for 50% of Airfreight Revenue in last 20 years • Volume of (high-tech) cargo down due to reduced size of product and products with more functions in single device creating less freight to ship • Airfreight Market will see slow, sporadic growth over next several years due to “modal shift” • Smaller HHG shipments may increase use of Airfreight or Unaccompanied Baggage

  32. Trends in Ocean Shipping • Since 2011 ocean rates have seen unprecedented gyrations and remain under pressure • Supply/Demand Ratios should/will favor shippers • Challenge = maintain rate levels and market share • Carriers may try to manage capacity • Skipping Sailings • Anchoring Vessels (Mothballing as in 2010) • Returning ‘Chartered’ Vessels • Consolidations, Mergers and Vessel-Sharing • Increased Risk of Financial Distress (Bankruptcy)

  33. Future Impacts on Ocean Shipping • Panama Canal Expansion in 2015 • Larger TEU Vessels begin transiting Canal • USA West Coast Ports will lose volume to Gulf and East Coast Ports • Bigger Ships = Bigger Mishaps/Cargo Loses = Bigger Insurance Premiums • More Mis-declared Container weights • Impact on “General Average” ? • Increase in “Round-the-World” sailings

  34. Moving Over the North Pole

  35. North Sea Route a.k.a “Northeast Passage” • New Shipping Lane from Europe to Asia • North of Russia – Cuts off thousands of miles and avoids transiting Suez Canal • In 2010 just four (4) ships made the trip • Since April 2014, 266 voyages have received permission from Russia’s North Sea Route Administration • Similar increased shipping activity in the Canadian Northwest Passage

  36. What is UP in Moving • Government Regulations Ports and Border Security Focusing on Personally Identifiable Information (PII) CARB - California Air Resource Board Tighter vehicle emissions restrictions USDOT/ FMCSA - Increased Bonding Limits, Hours of Service(HOS), CSA, Medical Registrations, EOBR Federal Maritime Commission (FMC) Increasing Bonds, OTI Vetting & Licensing Enforcement – particularly with “Middlemen” and Overseas NVOs FMC/FMCSA – Cooperative Focus on Rogues

  37. Combating Rogues • Use to be only a local or domestic issue – now impacting International Moving • The Internet is their hook to draw in uneducated consumers of moving services • Public – Private Cooperation is Key • FMCSA / FMC and a variety of industry entities • working hand-in-hand • Starting to turn the tide in North America

  38. USA Government – Rogues • Federal Motor Carrier Safety Administration – Protect Your Move • Federal Maritime Commission - I-27 investigation – “Barrel Trade” • MOU – FMCSA and Federal Maritime Commission • Enhanced – licensing process and bonding • MAP-21 Highway Bill – increased bonding for forwarders and brokers – raised from $10,000 to $75,000 • Increased focus on international rogue movers • Coordinated effort – Consumer Protections and Education • Trade associations, Federal, State and local (regulatory) agencies conducting “sting” operations to nab the scam operators – we refuse to call them rogue movers.

  39. Industry Action -Rogues • American Moving & Storage Association • AMSA administers professional certifications for specialists: • Certified Moving Consultant (CMC) & Certified Packer/Loader (CPL); and Registered International Mover (RIM)   • PRO-Mover Program – Enhanced vetting of Members

  40. Industry Action -Rogues • Canadian Association of Movers (CAM) – • “Year of the Reputable Mover” • Working through Provincial Ministries of Transport – Federal Ministry of Justice and in cooperation with Canada’s Office of Consumer Affairs and the Canadian Competition Bureau • www.mover.net/trust

  41. Is Space the Next Market? • Russia to begin Moon Colonization in 2030 • Which mover will handle first shipment of HHG? • Who will be first mover to have branch on the moon? Will they be a member of BAR / IAM? • Will Rogues still be a problem?

  42. THANK YOU! www.IAMovers.org @IAMOVERSSOCIALCAFE.IAMOVERS.ORG/homewww.facebook.com/iamovers

  43. WHERE People Will Be Moving – North America Outbound Fifth straight year United Kingdom was the Number 1 Destination • UK relocation traffic up 7.8% • The Netherlands moved no. 10 to no. 7 • Switzerland from number no.14 to no. 6 • Germany down 14.6% in shipment numbers • Francedown 21.7% Source: UniGroup Worldwide UTS Migration Study

  44. What is Down / Flat in Moving Drivers – Retention and Recruitment Hauling Capacity – remains tight, get tighter Pricing – Unhealthy emphasis on dollars and cents...at the cost of Service Profit Margins – Revenue Distribution Agent Confidence – Forced to work with ‘Unknown’ bookers, haulers and TSPs Ability to Forecast and Invest –

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