CEE labor force to return from U.K., Colliers predicts
The U.K.’s planned 2019 exit from the EU will trigger a massive return of citizens to Central and Eastern Europe (CEE) and will likely boost local real estate markets, finds a new study by commercial real estate services firm Colliers International.
The report, entitled “Labor Force Boomerang,” covers the Czech Republic, Slovakia, Poland, Hungary, Romania and Bulgaria. It finds that the emigration wave has peaked and workers that emigrated in previous years will start returning home. This is due to a weakening of the U.K. economy, which has already started with the British pound. The CEE states will greatly benefit from this, says Colliers, as those returning will ease the labor shortage that is holding back economic growth.
However, CEE states have a lot of work ahead to fuel this trend.
“A combination of wage rises, low taxes, better governance and legal frameworks, more modern education systems, a more familiar cultural milieu and encouragement from governments could well be pull factors to encourage those who have migrated to return,” noted Peter Leyburn, EMEA director of client services at Colliers International.
Leyburn explained that this market dynamic, termed the “labor force boomerang,” is likely to translate into increased investment interest, provided that worker productivity can keep pace with Europe. This should mean higher demand for office and industrial real estate space and increased retail spending, he added.
According to Colliers estimates, 20% of Hungarians working in Western Europe live in the U.K., as well as 40% of Slovaks, 34% of Poles and 24% of Czechs. The company expects that as wages grow, and corruption and political instability in home countries decrease, the homecoming trend will amplify.
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