More younger workers plan to flee the UK due to rising taxes and a poor economic outlook, wealth managers have said.
Warnings have also been raised about a “growing sense of disillusionment” with the UK, a lack of job prospects and a shortage of affordable housing.
In an interview with the Financial Times, Camilla Stowell, chief executive of Rathbones, said younger generations were seeking out opportunities abroad.
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She added that the rising interest among people in their 20s had been sparked by the “less than optimistic tone” about the UK’s economic growth prospects, as well as the job opportunities and earnings power overseas, noting that the younger generation are also more “mobile”.
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The warning comes as research from Rathbones revealed 42% of owners of small and medium-sized enterprises (SMEs) said government policy was unsupportive of businesses.
Meanwhile, 12% of SME owners are actively planning to relocate themselves, their businesses, or both due to the current UK tax burden.
David Little, financial planning partner at Evelyn Partners, said a “quiet exodus” was underway among younger people.
“Increasingly, young professionals and graduates in the UK are packing their bags, not for a gap year or a sabbatical, but for a permanent move abroad.
“As a financial planner, I’ve seen a noticeable rise in clients sharing that their children are choosing to emigrate in pursuit of a better life abroad.”
Little added that many parents were “actively encouraging” their children to move abroad rather than trying to dissuade them.
Are younger workers disenchanted with UK living?
In a separate poll by the Adam Smith Institute think-tank, one in four respondents aged between 18 and 30 said they might leave the UK, with many struggling to find affordable housing and citing concerns over their finances.
Little said there had been a “mindset shift” among younger people in the last five years, with many feeling the UK no longer offers the opportunities and lifestyle they want.
“There’s a growing sense of disillusionment with the current state of the UK,” he said.
“The atmosphere feels increasingly pessimistic, and it’s hard to ignore the mounting pressures, rising taxes, increasing unemployment and growing concerns about crime.”
Little also pointed out the UK’s tax burden is at its highest level in over 70 years.
Stowell and Little both said Dubai, Ireland and the US were some of the locations being scoped out by younger workers keen for greater opportunities.
Little said: “Dubai seems to have the edge. It has transformed into a global career hub, attracting thousands of British workers with its tax-free salaries, lack of crime, booming job market and high quality of life.”
UK professionals earning £90,000 to £120,000 a year often lose up to 45% of their earnings to income tax and National Insurance (NI).
However, that same salary in Dubai is often tax-free and may be accompanied by private medical insurance and housing allowances.
It is not just younger workers escaping the UK – the wealthy appear to be taking flight too.
As many as 1,800 non-doms left the UK during the 2024/25 tax year, according to analysis by consultancy Chamberlain Walker.
MoneyWeek spoke to one couple who left the UK for Italy after the government scrapped non-dom tax status.
