I have had the privilege of writing on several occasions for Barron’s, a highly respected financial journal published weekly by Dow Jones & Company, also publisher of the daily Wall Street Journal. As briefly mentioned in the text below, one of my earlier articles in 2007 described the results of our seventh survey of the American people on the subject of relocation. This article could be considered an “update”. It provides a warning. In my experience, it will be ignored until the damage is done, but such is life in the 21st century, or so it seems. To use the jargon of the day, this is being read by the 1%, but it needs to be read by the 99% as well. Barron’s has been kind enough to allow me to republish it here. The emphasis at the end is mine.
SATURDAY, NOVEMBER 26, 2011
The Great Escape
By BOB ADAMS
The U.S. could suffer greater economic stress if the number of young adults emigrating continues to rise. We can’t afford to lose their skill set, which includes the risk-taking ambitions of their forebears who immigrated here.
This is a dangerous time for the United States, and not just because of the lingering Great Recession. Young adult Americans are packing their bags and heading out of the country in astonishing numbers. Many more are turning their minds in that direction.
We’re not losing a generation yet, but we are losing many among the most likely to innovate, experiment and create: They’re the descendants of risk-takers who arrived in the U.S. in centuries past and built this incredible nation.
Our firm, AmericaWave, has been tracking the trend of Americans considering relocation overseas since 2005 using the IBOPE-Zogby opinion survey firm. (I summarized some prior findings in a Barron’s Other Voices piece, “A New Life in Panama,” Sept. 24, 2007).
As with any opinion survey, you have to know the question asked: “Are you planning to relocate to another nation for more than two years for reasons other than the requirements of the military, the government, or your job?”
The wording was meant to focus attention on those Americans voluntarily relocating. Had we not approached respondents in this manner, we have no doubt our numbers would have been far higher and more dramatic, but we were not interested in drama.
We offered a set of responses to choose from, the most serious being simply, “Yes, I plan to relocate outside the U.S.”
WE RAN OUR EIGHTH national survey in March 2009. The collapse of the U.S. housing market, high unemployment and the global financial crisis were then common knowledge, and the Dow Jones Industrial Average swooned, closing at 6547.05 on March 9.
Risk-taking was out of fashion. There was a sharp drop-off in the number of people who had made their decision to relocate overseas, but a steady number remained interested. Our ninth survey followed in March 2011. We expected to see some recovery in the numbers, but nothing substantial. In our baseline surveys between 2005-07, an average of 1.4% of U.S. households planned to relocate (about 1.6 million households, representing well over 3 million people). In 2009, it fell to 0.8% of households planning relocation.
The 2011 total was 2.5% of households planning to leave these shores, closing in on three million households and six million people. What changed?
The key was found in the breakdown by age group. Those from 25 to 34 years of age are young adults, some 42,000,000 of them. They are among the most energetic, innovative and creative Americans. They go where they feel the jobs and excitement are. Our wider research indicates a growing interest in Asia and Latin America, less so in Europe.
In 2009, less than 1% of this age group was actually into the planning stage of relocation. In 2011, it is 5.1%. While the 35-to-54 and 55-to-69 age groups also set new highs, it is those aged 25 to 34 who are the major factor in the increase of interest. In all our surveys, we have never seen a shift of this magnitude of those actually planning to relocate in any age group.
Behind them, the 18-to-24 age group includes many still in school or unable to find jobs. They are likely demoralized in these hard economic times, and the number planning relocation has collapsed. However, those “seriously interested and likely to relocate” and those “somewhat interested and may relocate” rose to 39.6%. In other words, nearly 40% of that age group have turned their minds toward leaving the U.S., whether or not they can afford it right now. In 2007, that total was just over 15%.
OUR SURVEYS ARE UNIQUE, but there is one other survey that should be noted. The Gallup organization has polled in well over 100 nations since 2007 on a similar question with a striking difference. “Ideally, if you have the opportunity, would you like to move permanently to another country, or would you prefer to continue living in this country?”
“Permanently” is a powerful word that indicates a level of intensity beyond any of our responses. Gallup breaks the results into eight global regions, including “Northern America” (here, the U.S. and Canada). The percentage saying they wish to migrate permanently is down in all but two regions– Northern America and the European Union. The result for Northern America is 10%, and Gallup tells us that it is the same result for the U.S. and Canada, taken separately. Two regions, South Asia and Southeast Asia, now show lower percentages than the U.S.
My generation (I’m 66) has more than a financial burden to carry. We have a guilt burden, too, that’s obvious to young adults. Our children and grandchildren apparently believe we’ve made a mess of our futures and theirs. Worse yet, we outnumber and outvote them. In 2011, there are more Americans 50 to 54 than in every younger five-year cohort.
BRING UP THE SUBJECT of national debt, and you will invariably hear that this is a terrible burden we’re leaving for future generations. Well, the future generations are alive and well, and capable of reading the news. They know. The secret is out. These Americans can help the U.S. succeed in the global economy if they leave with that as a goal. There are no better ambassadors. But what if many of those now wishing to relocate are not leaving for that reason, but rather to flee a nation that offers them a mountain of debt instead of opportunity. The most industrious people don’t always hit the streets to demonstrate; they hit the road.
The U.S. has been the Land of Opportunity throughout its history. If there is one entitlement that all Americans deserve, especially the young, it is opportunity. We can, we must and we will find the courage to face the mess we have made and clean it up.
But a reputation built over decades, even centuries, can be lost in only a few years. Our young builders and business people will not wait. The older generation must not wait.
BOB ADAMS is CEO of AmericaWave.com in Panama and of New Global Initiatives in the U.S., which provide marketing services for clients interested in reaching the emerging global community.
Copyright © 2011 Dow Jones & Company, Inc. All Rights Reserved. Republished with permission.