The age of fiscal austerity and sovereign debt crises has further sullied UK expats’ opinions of life at home. So much so that many don’t plan to go back. Ever.
Over 800,000 Brits canceled plans to return to the UK in 2011, according to a report from Lloyds TSB International. On top of that, a full 69% say they have no intention of returning to the UK at all–a 13% increase over last year.
Lloyds TSB’s Expatriate Banking Managing Director, Tony Wilcox, said:
Expats have an enlightening view of the UK, having experienced life both home and away, so it’s worrying that life in Britain appears so bleak when viewed through their eyes.
He added that the interconnected nature of the modern world has also helped reduce barriers to expatriation:
I think expats’ increasing happiness with life overseas also reflects that large groups of people in the UK are gradually becoming more outward-looking with increased global travel, more international business and many people generally coming into more contact with other cultures. It has become easier and a more natural transition for some people to settle in and enjoy life overseas than it would have been 20, even 10, years ago.
74% of the expats Lloyds surveyed said they believed quality of live would be better abroad. A paltry 7% believed it better in the UK. A further 64% of Brits said they were better off financially abroad–only 12% felt that way about home.
While as a general trend this is nothing new (historically a majority of expats have reported feeling better off abroad), the magnitude of the numbers is rather surprising. The sharp rise in the number of expats who say they won’t return to the UK, in particular, is a shocker. According to Lloyds’ calculations, nearly 825,000 of the 5.5 million Brits living abroad currently plan to stay there. The trend is certainly a challenge to conventional wisdom, which says expats eventually prefer to return home.
Lloyds’ findings seem to jive with the preliminary data from HSBC’s 2011 Expat Explorer Survey. According to HSBC, 63% of expats have more disposable income than they did in their home country, up from 56% in 2010. 64% say they will remain in their current country, a figure broadly in line with the Lloyds results.
There’s more to the story than the fact that British expats feel better off abroad, however. It’s also important to bear in mind where exactly these people are going. HSBC’s top 5 expat destinations for 2011 were:
3) Saudi Arabia
Perhaps needless to say, most of these countries have also seen increasing foreign investment inflows in recent years. Take the most recent FDI statistics from the United Nations Global Investment Trends monitor. Foreign investment in Egypt rose 1.7% in 2010, in Thailand 14.2% and in Singapore an astounding 122.7% (unfortunately the UN data didn’t include Saudi or Switzerland). Overall, foreign investment in developed economies fell 6.9% that year, while growing 9.7% in the developing world.
“For the first time,” the report noted, “developing and transition economies received more than half of all FDI inflows.”
In conclusion, the flow of “hot money”–short-term investments chasing superior returns–may be a solid predictor of expat movement patterns worldwide, trending toward countries where they–and the expats inevitably following in their wake–will have the greatest purchasing power.