How the Current State of Global Inflation Impacts Mobility
As global inflation rates remain high, businesses and employees worldwide are facing challenges that are adjacent to high rates and overall cost of living. While there are some signs of stabilization across global markets, uncertainty continues to shape decision-making for both employers and workers.
As global inflation rates remain high, businesses and employees worldwide are facing challenges that are adjacent to high rates and overall cost of living. While there are some signs of stabilization across global markets, uncertainty continues to shape decision-making for both employers and workers.
Economists around the globe are forecasting and predicting what the market and inflation rates will do this year and beyond, and while a crystal ball would make everyone’s lives easier, this blog post will explore the latest on inflation and how that may impact workforce mobility, talent acquisition and overall employee compensation.
Inflation Is a Top Worry for Adults Around the World
According to a recent IPSOS global survey, inflation is tied with violence and crime as the top concern for 32% of respondents. As the cost of living continues to rise—along with everyday expenses (and let’s not even talk about the price of eggs!)—employees may hesitate to make career moves, especially if international relocation is required.
From a business perspective, organizations looking to move their workforce internationally must account for new economic factors that influence forecasting and compensation strategies. Companies need to consider not only salary adjustments but also housing, taxation and cost-of-living variations, all of which can impact the attractiveness of relocation offers. From an HR perspective, there are likely additional supports and conversations that needs to be had with employees before, during and after a relocation to ensure their financial concerns are addressed throughout a relocation assignment.
Decisions Are Up in the Air Due to Inflation Volatility
Reuters reports findings from S&P Global that shows both businesses and consumers remain pessimistic about inflation trends. Industries such as homebuilding and manufacturing, which rely on stable economic policies, have slowed decision-making due to tariffs and other fluctuating costs.
The volatility of inflation rates across different countries means companies may delay hiring or relocation efforts. Alternatively, organizations may rethink their talent deployment strategies, shifting investments to locations where inflation is more stable. For example, inflation rates in emerging markets can vary widely compared to advanced economies, forcing companies to take a more flexible approach to workforce planning. It’s more important than ever to review your global mobility and relocation policies to make sure everything aligns with the economy of today.
But, There’s Hope.
Despite these challenges, positive indicators suggest the global economy may be on a path to stabilization. The National Institute of Economic and Social Research forecasts global GDP to grow just over 3% between 2025 and 2026, aligning with historical growth trends. As inflation cools, central banks in advanced economies are expected to continue easing interest rates, providing relief for businesses and consumers alike.
In addition to adjusted rates, some global markets, like the U.K. and Japan, are also taking proactive steps to strengthen wages, according to Euromonitor. These wage increases could improve workers’ purchasing power and, in turn, encourage greater workforce mobility.
Lastly, shifts in the labor market present new opportunities. The World Economic Forum’s Future of Jobs report highlights that the global unemployment rate has fallen to 4.9%—the lowest level since 1991. As digital transformation accelerates, new job categories are emerging. The report predicts that expanded digital access will create 19 million jobs by 2030 while replacing 9 million, underscoring the need for businesses to rethink their onshoring and reshoring strategies. Employers who assess their current workforce and invest in upskilling initiatives will be better positioned to navigate the evolving global labor landscape.
While inflation remains a significant concern, businesses that adapt to economic shifts and embrace strategic workforce planning can position themselves for success. By closely monitoring inflation trends, considering new market opportunities and investing in workforce development and relocation support, companies can turn challenges into long-term growth opportunities.
Interested in learning more about how we can help? Reach out to our international team today and make your relocations as smooth as possible.
