Housing woes hit job seekers where it hurts

FORTUNE -- Not so long ago, you may recall, plenty of employers were willing to foot the bill for moving expenses, and maybe even compensate you for a loss on your house, if you pulled up stakes to accept a job in a different locale.

These days, as they say in Brooklyn, fuhgeddaboudit.

Demand for executive talent is slowly rising, but not enough to loosen the purse strings for relocation, according to a new study from Chicago outplacement giant Challenger, Gray & Christmas.

The combination of a buyer's market in both talent and real estate has pushed the percentage of managers and executives relocating for new jobs down to just 6.9% in the third quarter of this year, a record low, down from 13.4% in the same period in 2009.

"Job seekers who own a home, even if they're willing to relocate, are basically stuck where they are if they're unable to sell their homes without incurring a significant loss," says CEO John Challenger.

With a big chunk of the workforce unable to move, he adds, "Some employers will have to delay expansion plans, thus slowing the recovery."

The news isn't all bad, though. The Bureau of Labor Statistics reports that 167 metropolitan areas have seen unemployment rates drop over the past 12 months. And as of August, joblessness in 232 cities fell below the national average of 9.6%, and employers in 27 states had created a total of 500,600 new jobs.

Small as those gains are, Challenger notes, "they may have been enough to lift job hunters from the sense of desperation that often compels unemployed people to relocate."

Even before employers got so stingy, relocation had been declining since the early '90s. From a record high of 49.2% in 1993, the number of managers and executives moving to take new jobs fell off gradually through the rest of the decade and has stayed below 20% since 2001.

One major reason for the drop: The Internet. "The same technology that makes it easier to conduct an out-of-town job search also makes it easier for people to work from anywhere," says John Challenger. "Faster and cheaper Internet connections have made it possible for people to gain out-of-town employment without actually moving out of town."