Britain used to have labour mobility, with people moving from rural areas to seek jobs in towns and cities. Or they'd move to where the work was. Governments try to move the jobs to the people, but it would be more effective to make it easier for people to move to where the jobs are.
Mobility hasn’t simply dried up. It has been priced out. The picture is more nuanced than the usual ‘nobody moves any more’ story. The decline is real but uneven. Around a million fewer people moved house in the 2000s than in the 1970s, mostly due to an ageing population, changes in the housing market and altered attitudes.
Long-distance moves have held up better than short ones. Inter-regional moves in England and Wales have not dropped as much, but there has been a big decline in shorter-distance moves. The worrying part is who has stopped moving. The decline is being driven by the young, particularly young graduates. These are exactly the people who once followed opportunity, and whose moves did most to match talent to jobs.
The first and biggest barrier is housing. The rational migrant compares the wage gain with the cost of living where the jobs are. In London and the South East, the rent swallows the raise. Researchers note that rising housing costs in London lessen the wage premium and therefore dampen the incentive to move.
A 2024 study of British regions likewise found rigidities in housing that deter mobility across regions. This is a planning problem before it is anything else. Since 1947, the right to build has been nationalized and rationed. The places with the most jobs build the fewest homes relative to demand.
Secondly, the state taxes moving. Stamp duty is a fine on relocation. It falls hardest on the person who changes job, city, or family size, and it discourages older owners from downsizing, which keeps family homes off the market.
Thirdly, social housing ties tenants to their council. A secure tenancy is valuable, and it is local. Move to a different area for work and you go to the back of someone else’s queue. The tenancy becomes a ball and chain.
Fourthly, national pay bargaining mutes the signals. When a nurse or teacher earns roughly the same in Sunderland as in Surrey, the price mechanism stops telling anyone where they are most needed.
And finally, regional policy itself pays people to stay. Subsidies to bring jobs to declining areas are well meant, but they treat the symptom and entrench the pattern.
An alternative approach would be to let the cities that want to grow, grow. We should liberalize planning where demand is highest. Allow streets to vote for gentle densification, release low-value green belt near stations, and let councils keep more of the tax revenue that new homes bring, so that they welcome growth rather than resist it.
We should abolish stamp duty, or at least exempt moves made for work. It is among the most economically damaging taxes per pound raised. A broadly-based property tax would serve far better.
We could make social tenancies portable. A national exchange or transferable entitlement would let tenants carry their security with them to a new town.
And we might introduce regional pay flexibility in the public sector, so that wages can reflect local costs and shortages.
We could widen the commuting radius by faster, cheaper links between cheaper towns and expensive cities to extend the labour market without anyone having to move house at all.
And we might offer modest relocation help to the unemployed by a deposit loan, first month’s rent, or a moving allowance. It costs less than years of benefits in a place with few vacancies.
When the job won’t come to the person, the person must be free to go to the job. At the moment, a young Geordie with a London offer faces a planning system, a tax bill, and a landlord that together tell him to stay where he is. Dick Whittington had only to worry about the cat.
Madsen Pirie