Undercover Economist

On the Move – Undercover Economist

In last week’s column, I fretted about the workers of Treorchy, South Wales, who have lost their jobs as Burberry’s shirt-making plant is closing. Unfortunately, they are not alone. Any small community with a lot vested in a single industry is vulnerable to any number of shifts in the economic landscape, whether caused by domestic or foreign competition, management blunders or technological change.

Even big cities can struggle if they overspecialise. Liverpool and Manchester are examples. Birmingham, on the other hand, has always been a city bustling away making everything and nothing in particular. As the late author Jane Jacobs once pointed out, Birmingham was thought highly inefficient compared with the specialised mills of Manchester, but when the downturn came Manchester was devastated and Birmingham kept on chugging along.

Looking to the US, one might ask why people still live in Detroit, which has suffered for so long? Why not move to Chicago or New York? People originally moved to places such as Treorchy because there was coal to be mined. Now that the mines have closed – and the Burberry factory, too – why do they stay?

One reason is that community ties matter. Many people like to stay near where they were born. But many others would like to seek new opportunities – even, dare I say it, new experiences. My father moved the family to four different locations across England in pursuit of work. I’ve also moved several times to find the right job, and only occasionally regretted it.

But emotional ties are not the only ones that bind…

Continued at ft.com, subscription free.