US companies paying millions to relocate executives
While U.S. workers have shown a reluctance to uproot their lives for new job positions as slack in the labor market dissipates, companies are upping perks and pay to lure C-suite executives to new cities.
Among the biggest 3,000 publicly traded companies in the U.S., the average relocation package was $144,633, according to data and solutions company Equilar, as reported by The Wall Street Journal. Relocation packages often cover moving-related expenses, which can include certain real estate fees associated with a new property, utility costs and other expenses associated with disrupting an individual’s life.
One of the top spenders was LendingClub, which shelled out $6.4 million to usher a new president and chief financial officer to San Francisco, from cities in Texas. Relocation bonuses of $3 million were awarded to the two executives, the Journal reported.
General Electric also spent more than $4 million to move four executives last year, while Caterpillar paid $2.6 million to relocate five individuals, according to Equilar.
Insurance company Aon and retailer Macy’s each shelled out more than $1 million to sweeten the pot for their relocating leaders.
Overall, fewer American workers are willing to relocate for jobs as the labor market strengthens and approaches full employment. Only 3.5 million Americans relocated for work last year, according to the U.S. Census Bureau.
Meanwhile, the largest number of workers are quitting their positions since 2001, as people become more confident they can find better opportunities elsewhere.
The concentration on perks is not isolated to the C-suite. Businesses are adding benefits for workers, U.S. Labor Department data showed, however higher wages aren’t always included among the extras. The cost of benefits – including vacation time and bonuses – rose 3 percent in June, while the cost of wages rose by 2.7 percent. Paid vacation time increased 4 percent year-over year, while bonuses jumped 12 percent.
Company leaders, however, were still enjoying robust salaries. Last year, the average CEO of a company on the S&P 500 made $13.94 million in compensation, according to the AFL-CIO. The CEO-to-worker pay ratio in 2017 was 361 to 1.