Bloomberg has an article out today that I found a little surprising. Apparently Americans are increasingly leaving Great Britain to return to the States. The article singles out London's financial industry as one of the major areas losing talent. That might challenge the notion that London will be the financial capital of the world. I'm just not sure what jobs those who flee London's world of finance hope to find in the U.S.
First, here's the basis of Bloomberg's claim:
The number of U.S. citizens in Britain fell 3.8 percent to 126,000 in the 12 months through September, according to the Office for National Statistics. The trend probably continued this year, with the Confederation of British Industry estimating the U.K. financial industry will lose about 45,000 jobs in the first nine months of 2009, or 4.3 percent of the total.
And the reason:
Americans are heading home as Britain plans a 50 percent tax rate for those who earn more than 150,000 pounds ($248,000) a year and employers cut benefits for workers living abroad, reducing the allure of London. That comes a year after the U.K. said foreigners who have lived in the country for more than seven years must pay 30,000 pounds annually or give up the special status that shields overseas income from British taxes.
The article also says that there are a number of "stealth" taxes that exceed U.S. hidden taxes as well. While I can definitely understand the desire to lower the amount paid in taxes, I'm just not sure what jobs these Americans hope to find in the financial industry back home. Though, according to the article, things are worse in Britain than in the U.S.:
The economic picture is also gloomier in Britain. The U.K. economy shrank 5.6 percent in the year through June, compared with 3.9 percent in the U.S. London's financial industry lost 29,371 jobs, or 8.3 percent of the total, last year, according to the Centre for Economic and Business Research. Financial companies in New York cut 20,200 jobs, or 4.3 percent, data from the state Labor Department show.
Sure, the financial industry in the U.S. had a lower percentage of job cuts, but financial firms aren't exactly hiring in the U.S. either. I suppose if you've been laid off in London, then you might as well return home to try your luck there. I'm just not sure your luck will be all that much better. According to the Bureau of Labor Statistics, in July there were 570,000 Americans unemployed in "Financial Activities," compared to just 261,000 before the recession started in November 2007.
The reality is that the financial industry has eliminated a huge number of jobs worldwide. Many of those jobs will take years to come back, and others may never return. For some of those individuals, it might be a good time to consider switching careers. Switching continents might not be enough.