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Chancellor urged to halt northern 'brain drain'

Published 21/11/2016

Skilled workers are flooding out of the North, according to a study
Skilled workers are flooding out of the North, according to a study

Chancellor Philip Hammond should cut housing and business taxes to stop the North continuing to suffer a "brain drain" as high-skilled British workers leave the region in their thousands, a new report says.

The Homes for the North study said that over the past decade the North has suffered an exodus of 310,000 highly qualified British workers with just 235,000 moving the opposite way.

It said the deficit suggests an average of 7,500 highly qualified British workers leave the region every year.

At the same time, 155,000 highly qualified migrant workers moved to the North over the last decade, according to the campaign group's analysis of data from the official Labour Force Survey and the Higher Education Statistics Agency (HESA)

The report suggested that while migrants were plugging skills gaps in the workforce, business investment could be put at risk after Brexit if there is an expected clampdown on immigration, potentially threatening the Government's so-called "northern powerhouse" initiative.

The group, made up of 19 housing associations which provide homes to a million people, claimed a better housing offer for graduates could help stem the flow.

Mr Hammond should therefore use his Autumn Statement to raise the stamp duty threshold to £350,000 and reduce business rates in an attempt to attract and retain high-skilled Britons, the campaigners said.

The twin measures could go towards creating "home and enterprise zones" identified by local authorities as being in need of urgent housing development, which could also see VAT exemptions for housing refurbishments.

A series of targeted "northern housing deals" between the Government, councils and providers could ensure the rapid building of affordable homes.

And a graduate homes scheme could be piloted in the north offering flexible tenancies and shared ownership using funds from the Government's shared ownership affordable homes programme, the report said.

Mark Henderson, chair of Homes for the North, said: "Stemming the flow of graduates and attracting more highly qualified British resident and foreign workers will be critical to economic growth across the north of England.

"While some regions in the north are clearly outperforming others when it comes to retaining degree level workers, it is apparent that the number of highly qualified immigrants working in the north has provided a shot in the arm for cities such as Manchester, Leeds and Newcastle.

"The availability and quality of housing and jobs will play a vital role in addressing this 'brain drain'. By devolving powers to decide locally the kinds of homes people need and by introducing a package of tax incentives in next week's autumn statement, the Government could deliver a real step-change."

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