U.S. corporations find it tougher to fill overseas jobs Roadblocks seem to be working spouses and 'family adjustment' fears

April 21, 1996|By JOURNAL OF COMMERCE

NEW YORK -- William Fontana never would have come home if it had been up to him.

But with his parents getting older and his daughter, Andrea, ready for college, "I felt we should be in the same country," he said. "I always wanted to be overseas. I'm back now four months, and I feel like a stranger in my own country," said Mr. Fontana, a 10-year expatriate veteran with Citibank.

"If not for personal reasons, I'd be back overseas."

Though it sounds like a familiar story, executives like Mr. Fontana, who until five months ago oversaw human resources offices for Citibank in Athens, London, Bangkok and Jakarta, are becoming rare.

Indeed, American corporations expanding globally are finding a dearth of American candidates for overseas assignments, even with a U.S. tax law that exempts the first $70,000 in earnings.

Mr. Fontana, now a vice president in the New York office of the National Foreign Trade Council, thinks a major reason is that working spouses don't want to leave their own jobs. Added to that are concerns about "family adjustment" to foreign cultures and increasing costs for moving and maintaining American workers overseas.

According to the annual Global Relocations Trends survey that the council publishes with Windham International, a global relocation consultant, half the 138 companies responding said that finding suitable expatriate candidates is their biggest challenge.

The average number of American expatriate employees per company last year was 198, a drop from 238 in 1994, "a manifestation of the problem" of dealing with working spouses, said Michael Schell of Windham International.

In response, corporate bosses have turned to training non-American workers overseas, effectively "globalizing" the work force to keep pace with their globally expanding companies. These trainees are becoming the new breed of "U.S." expatriates who will move according to the needs of their companies. They may have never even visited the United States, let alone lived here.

"[American expatriates] are the best and the brightest," Mr. Schell said, "and they are training the best and brightest once they are there. With the advent of technology and uniform communications around the world, there is less of a functional distinction between nationalities. What that bodes is an increasing globalization of the work force. Skills are much more transferable because they are much more global."

Still, the issue of working spouses has created such turbulence that companies aren't taking any chances with the expatriates they hire abroad.

Increasingly, they are turning to workers from cultures where wives traditionally follow their husbands on assignment. "They will hire Pakistanis or Indians, who are superb workers and whose spouses are not as concerned about working," Mr. Fontana said.

Women made up 13 percent of the U.S. expatriate population in 1995 -- a 1 percentage point increase over 1994, according to the survey of 138 companies. But the typical expatriate is still male (87 percent), married (76 percent) and with children accompanying them on assignment (60 percent).

Perhaps more troubling for these companies is that even when employees do go overseas, 42 percent of those who seek reassignment cite "family adjustment problems" that include the ability of their spouses and children to adapt to the different culture.

"It takes a certain breed. The average American today is not as adventurous as in the past," said Chuck Steel, expatriate administration manager for the Little Rock-based software firm Alltel Information Services Inc. "If you took 10 families, maybe three of them would be interested in international assignment. Then it's a matter of finding the square hole for the square peg and fitting in their requirements vs. their skill qualifications. We could use more candidates."

But, said Mr. Fontana, "the ironic thing is most of the money is earned in the emerging markets."

Alltel, with 16,000 employees, does business in 50 countries. Tours of duty are relatively short -- about two years -- although there has been an increase in the number of local employees hired abroad to run these branches.

"People are finding expatriate resources so expensive, there is a trend where they are trying to send an employee over and get him to train somebody to do his job and bring him back" as soon as possible, Mr. Steel said.

While some 32 percent of spouses were employed before the overseas assignment, only 9 percent found a job at the new location. That's down from 1994 when 45 percent of spouses were employed before, but 12 percent were employed during the assignment.

The success of the assignment depends in large part on where those expatriates are going. The most frequently selected location for expatriate assignments continues to be Britain, cited by 46 percent of the industries surveyed, followed by Hong Kong (25 percent), Singapore (20 percent), Japan (19 percent) and China (15 percent).

China has two other distinctions: It led as the country emerging as a prime location to send expatriate employees (45 percent); and it was the country with the second highest failure rate (10 percent) in expatriate assignments, after Japan (13 percent).

But success also depends on how well the corporation prepares executives and their families for foreign assignment. There are very few "enlightened companies," said Mr. Schell.

Most of the surveyed companies said they provide cross-cultural preparation for their expatriate employees -- 32 percent to all family members, 27 percent to employee and spouse only, and 3 percent to expatriates only.

But Mr. Schell said most expatriates are "culturally underexposed" because such training doesn't go far enough. "Unless companies do more," he said, "the problem will get progressively worse. Many people in the U.S. feel that what works here works all over the world. It doesn't. You have to take countries one by one."

Pub Date: 4/21/96

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