The London problem is holding young Brits back
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We often talk about the housing affordability crisis and the economic challenges facing young adults as if they were the same in all developed Western countries. choose between a bank balance and broken dreams.
On the face of it, the situation is similar across countries. Rising rents and house prices in the U.S. have led to an exodus of young adults from megacities such as San Francisco and New York to cities such as Austin and Denver in Britain leavers are increasingly heading to cities such as Bristol.
But if it is not immediately obvious, these migrations are not the same.
Suppose a high-flying Briton, defined for this argument as someone in the 75th percentile of the income distribution among the under-40s, chooses Bristol over London to avoid crippling rents and seven-figure house prices. Their housing costs will certainly be lower, but the income will be much higher. Net of housing costs, choosing a cheaper home in Bristol would still result in a 23 per cent reduction in net income, according to my calculations.
By contrast, the equivalent young American who rents in New York can go to much cheaper Denver and be better off overall, or go south to Austin and be only 2 percent worse off at the end of the month about the impressive and growing dynamism of cities.
This gap in available alternatives highlights a less-discussed half of the housing crisis, and particularly in the UK; it’s about the geography of good jobs, as well as house prices and rental costs.
For graduates looking for a successful, high-paying career, America offers many avenues in many places. In the UK, it is increasingly becoming a bust, and only growing. Less than half of the UK’s highest-paid jobs were in London for 30 years Today, that figure is almost 75 percent. Top wages are much less concentrated in the US and are no longer growing.
In fact, the share of skilled jobs in America that can be found in New York and California has been declining in recent years. Instead, these roles are becoming more common in states like Texas.
By contrast, the UK is the only Western member of the G7 where the top jobs have been much more concentrated in the superstar region over the past two decades. And while it’s true that Japan is becoming more Tokyo-centric, at least they’re building houses there.
The high cost of housing in major cities is a common problem today, but young Britons face the peculiarly toxic change of having an extortionate capital, which is also increasingly the only place where a top career is possible :
First, reform planning The goal of starting a new era of housing in the UK is an important step towards easing the pressure on young adults. However, people need fulfilling careers, not just cheaper rents. This is where the next steps are transfer power Being away from London and giving cities a chance to compete with the capital are also important.
A report last week showed that Britain has the highest proportion of workers excellent qualifications for their work In all OECD countries, the concentration of graduate roles in the capital is considered to be largely to blame.
If you want to avoid Violation of young people’s beliefs that they can succeed, you have to fulfill society’s implicit promise that if they apply themselves, they will get the future they have earned.
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