Bye American: Flaccid Economy Drives U.S. Residents Abroad
In his 2007 book, Leaving America: The New Expatriate Generation, author John R. Wennersten argues that “many people these days, from college students to retirees, are uncertain or ambivalent about what it means to be an American.”
These misgivings, maintains Wennersten, combined with world-shrinking technology such as Skype (MSFT), Google (GOOG) Docs, and Apple’s (AAPL) FaceTime, have “encouraged a new generation of people to respond to the pull of global citizenship.”
However, according to John Sternal, vice president of communications and research at LeaseTrader.com, economic distress trumps existential anxiety for many lessees jettisoning their cars and moving abroad.
“Up until 2007, our business was all about the upgrade,” Sternal tells me. “Then, when cracks in the housing market started to appear and everyone’s adjustable rate mortgages were adjusting, we started seeing people downsizing. When oil prices spiked toward the end 2008, we saw a wave of people getting rid of their Hummers and SUVs because they couldn’t afford five-dollar-a-gallon gas. It was right around this time we saw the first wave of customers turning in their cars and leaving the U.S.”
Sternal says he was not altogether surprised; for many people, the economic upset was “tremendous.”
“We’d sit there and say, ‘Okay, this is drastic, but once the economy gets out of technical recession mode, things will get back to normal,’” recalls Sternal. “Now, here we are, almost four years later, and the number of people ending leases and moving elsewhere has about doubled since then. That’s what’s shocking to us.”
In fact, LeaseTrader’s data projects that 6.2% of this 2011’s “lease escapes” will be leaving the country -- more than twice the 2.5% who left in 2007.
Some escapees are returning to where they originally emigrated from, with the top-five destinations being Brazil, Israel, India, the U.K., and Asia.
“Some people are sort of ‘going back home,’” Sternal explains. “It’s not really happening for them in America anymore, so they leave. Others have been unemployed for two, three, four, five years. The system no longer works for them. These folks are basically saying, ‘There are different places in this world I can flat out move to and resurrect my financial situation.’”
While no reliable data exists as to the total number of American expats out there ("We don't count U.S. citizens living abroad,” Elizabeth Grieco, chief of immigration statistics at the U.S. Census Bureau, once told Jay Tolson of U.S. News & World Report), estimates place the figure somewhere between four and six million.
As far as intent to leave the country, statistics compiled by consultant Bob Adams of America Wave, Inc. reveal two fascinating insights:
One, 40% of Americans aged 18 to 24 are “seriously interested” in relocating outside the United States.
And two, it’s not only the wealthy who plan to leave.
Adams’ stats show people earning less than $50,000 per year are 2.7% more likely to leave the country than those earning between $50,000 and $75,000, 4% more likely to leave than those earning between $75,000 and $100,000, and are almost twice as likely to move elsewhere than those earning over $100,000.
“Yes, having more money is helpful for many things, relocation among them, but it is not the determining factor,” he writes.
True though this may be, the rich having less money spurred Ron Schulman to leave Miami for Israel.
“When Madoff happened, our clients just disappeared,” Schulman, an interior design contractor, tells me.
He says the Israeli construction industry is “like 2004 or 2005 in the U.S.”
“We see America as the land where you can make it big, but I don’t have to tell you what we went through in South Florida over the past couple of years,” Schulman says. “In Israel, everything is a couple of years behind -- we just got our first Abercrombie & Fitch (ANF). I know this won’t last forever, because nothing does, but they’re building like crazy and we felt like we had an opportunity here right now.”
Some aren’t quite sure what it is they’re looking for, but 28-year-old Francine, a former real estate agent from Las Vegas who decamped for Xi’an, China, “just figured things had to better somewhere else.”
"Being poor anywhere in the world is bad, (but) if you are broke in the U.S., people just do not treat you very well,” Francine, who declined to give her last name but shared her fondness for the conveniently located Walmart (WMT), McDonald’s (MCD), and KFC (YUM) in her adopted hometown, told MSNBC last month. “In China, people are still very polite and respectful regardless of your financial status and I like that."
Others leave the United States because they have no other choice.
Isaac Haxton, a professional online poker player, began considering a move overseas after the FBI shut down PokerStars, Full Tilt Poker, Ultimate Bet, and Absolute Poker last April. "Ultimately, it doesn't really matter where I end up," he told Time magazine’s Matt Villano. "So long as I can get myself to a country with good Internet connections, a country that allows me to earn a living again, I'm there."
Of course, the current economic climate in the U.S. has dissuaded some who might have risked it all to enter the States a short time ago from coming at all -- one measure used by the Border Patrol to gauge illegal Mexican immigration shows a drop from 1.6 million people trying to cross the border without papers in 2001 to 304,755 during the 11 months ended in August.
"What stimulates migration is the need for workers," Genoveva Roldan, a scholar at the National Autonomous University of Mexico, told the Los Angeles Times. "Right now, the migrant networks are functioning to say, 'Don't come -- there's no work.'”
Yet, for all the movement away from the United States and toward galloping economies like that of China's, America still retains a particular cachet in one area.
The Institute of International Education and the State Department’s Bureau of Educational and Cultural Affairs announced on Monday that the “number of international students at colleges and universities in the United States increased by 5% … during the 2010/11 academic year,” led by a 23% total increase in Chinese students, with a 43% jump in Chinese students studying at the undergraduate level.
Overall, there are 32% more international students studying at U.S. colleges and universities than there were 10 years ago, thanks in no small part to the financial strength that is drawing Americans to those parts of the globe.
As IIE board member Peggy Blumenthal recently said, “Parents now have money to send their students to the best universities anywhere in the world.”
This story posted by LeaseTrader.com, the automotive service company that lets people transfer out of their Car Leases early. If you're looking to swap a lease or transfer out of your car lease, please visit www.leasetrader.com