Bang in the middle of Piccadilly, the office where 27-year-old John Levitt
goes to work each day is at the buzzing heart of the capital. But early next
year his job at the Qualifications and Curriculum Authority (QCA) will lead
him to begin a new life in Coventry. QCA’s relocation has been planned since
2004, when the Lyons Review of public-sector relocation advised that 20,000
central-government posts should move from southeast England by 2010, and
Levitt is among 100 or so of the organisation’s 500 staff expected to go.
“I’ll be leaving behind lots of friends and it will be tough to readjust to a
new social scene,” said Levitt, “but for me it’s good in a few ways –
housing is cheaper so I will be able to get on the property ladder, and I am
originally from Leeds and have elderly grandparents there and family friends
in Birmingham.
“If they were relocating somewhere a bit further away I might have had second
thoughts but I enjoy my job and not having to get the Tube every day will be
a big plus.”
QCA is one of a number of high-profile relocations: five BBC departments will
be moving to Salford Quays in 2011 and Network Rail has just announced plans
to move a significant part of its workforce to Milton Keynes in 2012.
Relocations have traditionally been driven by factors such as long-term
planning or the need to expand, but with many organisations seeking to
reduce overheads in the downturn, saving money by moving to smaller offices
or to parts of the country where the rent is cheaper makes ever more sense.
A report by the property agent Cushman & Wakefield in September found that
a quarter of firms planned to cut costs in 2009 by reducing space
requirements, with a fifth intending to consolidate staff into one building
and almost 10% considering moving to cheaper premises. The recession wasn’t
a factor in QCA’s decision, but its move is timely.
“We’re recruiting some 500 people in the Midlands and the economic climate
does come into that,” said Andrew Hall, who is supervising the relocation.
“I’ve always believed that most of our London workforce would not work for
us in the West Midlands and one of the concerns was whether we would be able
to recruit the right skills quickly enough, but the recession means that we
are finding it increasingly easy to recruit there, and that more of our
London staff may consider coming with us because of the poorer job prospects
here.”
In fact, the uncertain jobs market has resulted in a subtle shift in power
when relocation is on the cards. Gerard Barry at the commercial property
consultancy Lambert Smith Hampton said: “A year-and-a-half ago we had lots
of media companies in north London looking to relocate to the trendier areas
such as Clerkenwell. They would always say how important it was to retain
their workforce. Now the priority is immediate cost savings and companies
are making the decision to move further away because they can pick up
employees wherever they go.”
For organisations that planned to move before the recession hit, however, the
financial climate has made some elements of relocating more difficult. The
shipping company Maersk moved its headquarters from London to Liverpool this
week as part of a push to cheaper premises. “We had a good operational
office in Liverpool and a number of customer-facing functions so it made
commercial sense to move the management team there,” said Jackie Scarfe,
head of HR. “There were the obvious savings to be made, of course, but for
us the economy has made it more difficult. We were moving from south to
north and for individuals that have properties in the south it’s a terrible
time to sell. We started off by having a good relocation policy but quickly
found that we had to take a much more individual approach. “We have a number
of people who are splitting up their families temporarily in order to move.
It’s been very hard, and as an employer you have to appreciate just how big
a change it is for people.”
Cost can be a deterrent too. Some organisations that planned relocations
before the slump have postponed their moves until it is over. Many
public-sector relocation plans have been put on hold while funding is tight,
and the international law firm Salans has cancelled six planned moves to
larger premises in London, Moscow, Kiev, Istanbul, Bucharest and St
Petersburg as a result of the credit crunch.
For some organisations, though, pushing ahead with a relocation is a way of
reasserting their confidence and prowess. KPMG, the accountant, is moving
4,000 employees from its Blackfriars offices to Canary Wharf next summer.
Its head of infrastructure, Mike Blake, said it had been a positive focus
for staff in these difficult times. “We have had a very good response.
Initially they say, ‘I am used to working in the City’, but now that they
are excited about new buildings, there’s a buzz about it. The firm itself is
moving forward.
“With any long-term project you have to acknowledge that there are economic
cycles, but this is a big step for the next 25 years and we need to think
about the best environment for our business in the future.” Even for firms
that can only dream of a morale-boosting relocation, simply looking into
such a move can reap rewards.
“Another trend that has emerged is that people are turning to their landlord
and saying we have cut staff, we need to renegotiate the rent or we’ll move
on,” said Barry. “There’sa lot of bargaining going on. Landlords don’t want
to leave their buildings empty, especially now they have to pay
empty-building rates, so companies might get a very good package by doing
their research and making a deal to stay put.”
Find out more
The Sunday Times Recruiter Forum is a platform for employers and industry
experts to communicate with job candidates. They can share good practice and
discuss the issues affecting recruitment and retention in today’s market. To
have your say on the week’s topic go to timesonline.co.uk/recruiterforum.
Firms wishing to get involved should contact brendan.jones@newsint.co.uk
Upcoming Sunday Times events for HR professionals: Beating the
recession: 1 Organisational restructuring (June) Beating the recession: 2
Preparing for the upturn (July) For further details go to beatingtherecession.org.uk
or phone 020 7602 6655
