Localisation Trend = Expat Conversion
Localisation has gained significant momentum over the last years. In simple terms, localisation implies migrating from an expatriation contract to a local contract, and it involves consequently changing some of the terms and conditions of the job assignment. In general, it means losing all or most of the expat benefits such as spouse and family support, language classes, housing and car allowances, school allowance, etc… It could also involve receiving a “local salary” versus an “expat salary”, in other words a salary adjustment, generally downwards, more in line with the country of localisation.
Some expats decide to accept a local contract, even despite the aforementioned concessions, because they want to avoid moving again and prefer to give stability to their families and to their careers. Even sometimes they are somewhat forced to become local employees because there is no other professional avenue for them to pursue or because the job risk is too high. Others choose to localise because they are used to the country they are in and they want to continue with their international adventure there or from there.
Nevertheless, there are many expats that reject the offer to become local employees because they see it as a professional and/or financial downgrade. They prefer to look for another job in another company or to ask for a repatriation to their country of origin, where they expect to get a better job opportunity. Some expats that were not satisfied or unhappy with their international journey, take the opportunity to go back home to return to “normal life” and reunite with friends and family.
Regardless of the decision to localise or not, it is a fact that over the recent years and especially after Covid, companies have realised that they don’t need to engage in expensive and complicated expatriation assignments to enjoy international success, to promote knowledge sharing and to transfer expertise among markets and businesses. Today’s online tools facilitate these processes without the imminent need of relocating employees and their families, with all the costs and logistics that these moves involve.