Global Workplace Dynamics: Expats vs. Locals

In today’s globalized workforce, expatriates—aka expats, or professionals living outside their native countries—play an increasingly significant role in shaping international business. At Greenback Expat Tax Services, where we specialize in navigating the challenges of expat taxation, we wanted to explore the relationships between expats and the host country nationals (HCNs) they work with. Our recent study uncovers the perceptions, challenges, and opportunities that arise when these diverse professionals collaborate.

By examining the perspectives of expats, HCNs, and their managers, we’ve gained useful insights that can foster more effective cross-cultural work environments and help employers and employees thrive in the global marketplace.

Expats’ Perspectives on Host Country Nationals

Our study begins by examining the dynamics between expats and host country nationals (HCNs) in global workplaces, revealing perceptions, challenges, and areas of cultural convergence.

Expats expressed nuanced views of their HCN colleagues. Team collaboration was the top perceived strength of HCNs, with 33% of expats acknowledging this quality. Strong work ethic and reliability each garnered recognition from 29% of expats, highlighting the positive attributes HCNs bring to multinational teams.

However, challenges persisted. We also found that 43% of expats viewed resistance to change as the top weakness among HCNs. Communication barriers and a perceived lack of innovation were also noted by 27% and 23% of expats, respectively. These findings emphasize the importance of fostering an environment that encourages open dialogue and embraces diverse perspectives.

Nearly half of the expats surveyed have felt challenged when engaging with HCNs. The primary sources of these challenges were different communication styles (51%), varying expectations regarding work-life balance (45%), and language barriers (40%). Despite these obstacles, 31% of expats received a raise last year, with an average increase of 8%.
We also saw a strong commitment from expats to bridge cultural gaps. An impressive 85% actively engaged with HCNs by speaking their native language and immersing themselves in the local culture, demonstrating a willingness to adapt and integrate.

Host Country Nationals’ Views on Expats

This section of our study explores how host country nationals (HCNs) perceive their expat colleagues, highlighting strengths, challenges, and the impact of intercultural mentoring.

HCNs recognized several key strengths in their expat coworkers. Team collaboration topped the list, with 43% of HCNs acknowledging this attribute. Strong work ethic followed closely at 42%, while high adaptability was noted by 39% of HCNs. Over 90% of HCNs expressed appreciation for expats who made efforts to communicate in the local language and engage deeply with the culture.

Still, they identified some challenges in working with expats. Communication barriers were the primary concern, cited by 42% of HCNs. Limited language proficiency was a close second at 40%, while 29% of HCNs observed difficulties in adapting to the local culture.

Our research also revealed the significant impact of intercultural mentoring from HCNs on expats’ performance. This mentoring positively influenced expats’ productivity (70%), innovation (64%), job satisfaction (62%), and work ethic (60%).

Considering all this, HCNs showed a greater preference for working with expats from certain countries compared to others. We broke down this comparison by expats’ countries of origin:

• United Kingdom: 28%
• United States: 26%
• South Africa: 18%
• Germany: 18%
• Spain: 15%

These findings emphasize the importance of cultural exchange and mutual understanding in fostering productive global workplace relationships. As for compensation trends, 35% of HCNs received a raise last year, with an average increase of 5%.

Managers’ Perspectives on Expats and Host Country Nationals

Next, we’ll see how managers view and approach the dynamics between expats and host country nationals (HCNs) in the workplace.

Managers held varied perspectives on the performance and management of expats and HCNs: 20% of managers said HCNs are more productive and innovative, slightly higher than the 18% who said the same about expats. When it came to pay raise eligibility, 36% of managers believed HCNs were more likely to receive a raise, compared to only 18% for expats. Another 39% of managers find expats easier to manage, while 29% feel this way about HCNs.

Management strategies often differed when addressing these two groups, with 56% of managers employing distinct approaches for expats and HCNs. When managing expats, the most effective approaches were supportive (27%), focusing on creating a motivating environment; participative (23%), encouraging collaboration; and transformational (17%), inspiring team members to exceed expectations.

HCNs, on the other hand, have responded best to slightly different approaches. Participative management topped the list at 24%, followed by supportive at 19%. Directive management, which provides clear and specific instructions, was effective for 18% of HCNs but didn’t feature prominently for expats.

It’s important to tailor management approaches in diverse teams, particularly when you consider the unique needs and backgrounds of expats and HCNs.

Bridging Borders

Expats and host country nationals (HCNs) have distinct cultural differences to consider while striving for productivity and innovation. Our research emphasizes the importance of mutual understanding, effective communication, and tailored management strategies in these multicultural teams. 

As global mobility continues to shape international business, organizations that embrace diversity and foster cross-cultural competence will be better positioned to benefit from the strengths of both expats and HCNs. As we move forward in an increasingly interconnected world, the ability to bridge cultural gaps and harness the collective strengths of a global workforce will be key to their success.

Methodology

For this study, we surveyed 400 expatriates, 400 host country nationals (HCNs), and 200 managers of expatriates and host country nationals to compare the dynamics between expats and HCNs in global workplaces. The average age among expats was 33, comprising 38% male, 58% female, and 4% non-binary. The average age among host country nationals was 30, comprising 42% male, 57% female, and 2% non-binary. Among managers, the average age was 35, comprising 36% male, 62% female, and 2% non-binary. The percentages in this study may not be exactly 100 due to rounding.

About Greenback Expat Tax Services 

Greenback Expat Tax Services simplifies tax preparation for US expatriates worldwide. Our team of expert accountants combines extensive knowledge with a user-friendly digital platform to deliver hassle-free, accurate tax solutions tailored to your international lifestyle.

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