MANY economics bloggers are discussing a startling story in today’s Daily Telegraph, which reveals that educated Britons are leaving the country in record numbers. A study conducted by the Organisation for Economic Co-operation and Development found that British emigration rates are surpassed only by Mexico. Apparently, America is one of the chief destinations for those leaving Britain, suggesting that Americans may soon be forced to press 1 to hear messages from the Department of Motor Vehicles delivered in their own accent.
Explanations for this phenomenon vary. Megan McArdle suggests that the relatively monopolar nature of Britain’s urban geography is partly to blame:
I assume this has something to do with the fact that it is very easy for Britons to go to wealthy, English-speaking countries, and also that there’s a relative lack of migration opportunities in Britain. If you’re American or Australian, you can always pick up and try another city, but in Britain, you mostly move to London or you . . . move to London. This is an exaggeration, of course, but there’s nothing like the ability to say, “You know what, things aren’t going so well in Boston, so I’m moving to LA.” If the economy, or the job opportunities are bad in London, they’re probably bad everywhere else in the UK too.
This assumes that there isn’t much correlation between the British economy and those of the former colonies, which may not be entirely true.
I suspect that housing prices may be a significant factor in these migration decisions. As Ed Glaeser has documented (PDF), recent and massive population growth in America’s sunbelt can be attributed to punitively high housing prices in places like the northeast and the San Francisco Bay area. Households have left those locations for cheaper housing markets despite the economic strength of the source cities.
As The Economist noted back in December, home price increases in Britain have been nearly twice those in America. No doubt if one were to compare individual urban markets (say, London to Atlanta) the difference would be greater still. Given the strength of the pound and the ongoing American housing market meltdown, a Briton can now purchase most of Phoenix for the price of a Chelsea broom closet. That’s a strong incentive for those with skills in high demand.
Source: Free Exchange|The Economist