Britain’s Got No Talent: Half of U.K. Expats May Exit

By Brian Swint

June 24 (Bloomberg) -- Almost half of U.K.-based foreign professionals are considering leaving as they endure rising living expenses and the recession, more than in any other country, a survey by HSBC Holdings Plc showed.

Forty-four percent of expatriates in Britain are contemplating moving, suggesting the U.K. doesn’t live up to the name of the “Britain’s Got Talent” television show, HSBC said today in a survey of more than 3,100 people who don’t live in their home nation. The bank didn’t define an expat.

“Worldwide, 74 percent of respondents claim to have increased disposable income since becoming expats, yet this figure falls to just 47 percent of expats in the U.K.,” HSBC said in a statement. “The U.K. remains one of the most expensive places for expats to live -- and the recession has taken its toll.”

Britain’s worst economic contraction since 1979 has already pushed up unemployment, and the pound’s 17 percent drop against the dollar in the past year has also curbed the value of expats’ U.K. earnings. Business failures will rise to a record this year, BDO Stoy Hayward LLP said in a separate report today.

The U.K. recession will be worse than originally forecast this year, the Organization for Economic Cooperation and Development said today. It predicts a 4.3 percent contraction in 2009, compared with a March forecast of 3.7 percent.

Expat Earnings

The largest proportion of expats earning more than $250,000 a year live in Russia, with a total of 30 percent, followed by Hong Kong at 27 percent and Japan at 26 percent, HSBC said. A fifth of the survey respondents in the U.K. make $60,000 a year or less, and three-quarters of expats in Britain have scaled down spending because of the slump.

Asian countries tend to be cheapest for accommodation, HSBC said. Fifty percent of expats in Malaysia, 49 percent in China and 43 percent in India said that housing costs much less than in their home country.

Britain was second-most expensive for food after Switzerland, HSBC said. Seventy-eight percent of U.K.-based expats said they paid more for transport than they did at home.

Almost 100 companies will fail every day this year in Britain, pushing the total to 36,200 for the year, BDO Stoy Hayward said. The number will reach 40,400 in 2010 because record low interest rates and other stimulus measures to combat the slump won’t kick in for two years, the report said.

“Business failures in Great Britain are rising unabated as the fallout of the economic downturn becomes ever clearer,” said Shay Bannon, head of business Restructuring at BDO Stoy Hayward, “Consumer spending is set for a steep contraction in 2009 and households will continue to be hit by rising unemployment, weaker earnings growth and reduced perceived wealth levels.”

To contact the reporter on this story: Brian Swint in London at bswint@bloomberg.net.