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Mapping the Global Migration of Millionaires

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millionaire migration map

The world’s wealthiest people are also the most mobile.

High net worth individuals (HNWIs) – persons with wealth over US$1 million – may decide to pick up and move for a number of reasons. In some cases they are attracted by jurisdictions with more favorable tax laws, or less pollution and crime. Sometimes, they’re simply looking for a change of scenery.

Today’s graphic, using data from the annual Global Wealth Migration Review, maps the migration of the world’s millionaires, and clearly shows which countries are magnets for the world’s rich, and which countries are seeing a wealth exodus.

The Flight of the Millionaires

It’s no secret that China has been a wealth creation machine over the past two decades. Although the country is still making a number of its citizens very wealthy, over 15,000 Chinese HNWIs still chose to migrate to other countries in 2018 – the most significant migration of any country.

Here’s a look at the top countries by HNWI outflows:

CountryNet Outflow of NHWIs (2018)% of HNWIs lost
🇨🇳 China15,0002%
🇷🇺 Russia7,0006%
🇮🇳 India5,0002%
🇹🇷 Turkey4,00010%
🇫🇷 France3,0001%
🇬🇧 United Kingdom3,0000%
🇧🇷 Brazil2,0001%
🇸🇦 Saudi Arabia1,0002%
🇮🇩 Indonesia1,0002%

Figures rounded to nearest 1000.

Unlike the middle class, wealthy citizens have the means to pick up and leave when things start to sideways in their home country. An uptick in HNWI migration from a country can often be a signal of negative economic or societal factors influencing a country.

This is the case in Turkey, which has been rocked by instability, mass protests, and an inflation rate estimated to be in the triple-digits by some sources.

For the third straight year, Turkey lost more than 4,000 millionaires. An estimated 10% of Turkey’s HNWIs fled in 2018, which is concerning because unlike China and India, the country is not producing new millionaires in any significant number.

Millionaire Magnets

Time-honored locations – such as Switzerland and the Cayman Islands – continue to attract the world’s wealthy, but no country is experiencing HNWI inflows quite like Australia.

The Land Down Under has a number of attributes that make it an attractive destination for migrating millionaires. The country has a robust economy, and is perceived as being a safe place to raise a family. Even better, Australia has no inheritance tax and a lower cost of health care, which can make it an attractive alternative to the U.S.

In 2018, Australia jumped ahead of both Canada and France to become the seventh largest wealth market in the world.

Here’s a look at HNWI inflows around the world:

CountryNet Inflow of HNWIs (2018)% of HNWI Gained
🇦🇺 Australia12,0003%
🇺🇸 United States10,0000%
🇨🇦 Canada4,0001%
🇨🇭 Switzerland3,0001%
🇦🇪 United Arab Emerates2,0002%
🇧🇲 Caribbean*2,0003%
🇳🇿 New Zealand1,0001%
🇸🇬 Singapore1,0000%
🇮🇱 Israel1,0001%
🇵🇹 Portugal1,0002%
🇬🇷 Greece1,0002%
🇪🇸 Spain1,0001%

Figures rounded to nearest 1000. *Bermuda, Cayman Islands, Virgin Islands, St Barts, Antigua, St Kitts & Nevis, etc

Greece, which was one of the worst performing wealth markets of the last decade, is finally seeing a modest inflow of millionaires again.

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Cities

The 8 Ways Urban Demographics are Changing

These pivotal trends show how urban demographics are aiding in the transition to a very different economic and investment landscape.

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The 8 Ways Urban Demographics are Changing

Cities are what keep the global economic machine humming.

Over 80% of the world’s economic output is derived from activities in cities – and more specifically, it’s estimated that 60% of GDP growth occurs in just the top 600 urban centers.

Given the above, it’s fair to say that the destiny of humankind is directly linked to what happens in major cities. Further, how urbanization plays out over time could end up having a significant ripple effect on the economy, and we should pay close attention to such trends.

Urbanization 2.0

Today’s infographic comes to us from Raconteur, and it showcases eight different ways that urban demographics are evolving.

Below we will summarize the changes, along with potential impacts on the economy:

1. A Higher Percentage of Urban Dwellers

Between 1950 and 2018, we went from 30% to 55% of the world’s population living in cities. This has been driven largely by today’s middle and high income economies in places like North America, South America, Europe, and Japan.

The next stage of urbanization will see us move to 68% – more than two-thirds of the world’s population – living in these urban conglomerations. It will be driven by countries in developing markets, creating a potent investing megatrend along the way.

2. The Countries Driving Growth

It’s estimated that three countries will combine for 35% of all urban population growth.

RankCountryGrowth in Urban Population (2018-2050)% of Global Urban Growth
World860 million people35%
#1India416 million people17%
#2China255 million people10%
#3Nigeria189 million people8%

In total, there will be 2.5 billion more urban dwellers in 2050 than there are today. Many of these people will experience rising incomes in cities, increasing the global middle class to an unprecedented size.

3. Peaking Rural Populations

On the flipside, it appears the world’s rural population has nearly flatlined, with anticipation that it will peak in absolute terms in the next couple of years. Rural populations have been slowly growing since 1950 until this point.

4. The Rise of Megacities

There will be 43 megacities by the year 2050, which is more than quadruple the amount that existed back in 1950.

The changing geography of the world’s megacities will be one of the major forces that shapes the future of the global economy and accompanying investment trends.

5. New Population Centers

By 2050, more than 70% of the world’s urban population will live in Asia or Africa. Meanwhile, North America and Europe will combine for closer to 15% of that total.

6. De-Urbanization

The role of de-urbanization is often downplayed or forgot about when discussing urban demographics, but it is an interesting issue.

Factors such as falling fertility rates, economic contraction, and natural disasters are actually shrinking the size of some cities. In fact, McKinsey predicts that 17% of cities in developed regions will see a drop in population between 2015-2025.

7. Disparities in Urban Growth

The rate for urban population growth is actually trending down across all types of economies – however, these rates come from very different starting points.

High income countries are currently averaging growth of less than 1% per year, and this will continue to decline to below 0.5% per year by 2050. Over the same time period, low income nations will go from 4% to 3% per year.

8. Changes in Average Age

The age distributions in large cities within developed nations will begin to skew older, something we’ve shown previously when looking at the median age of every continent.

The biggest impact here may be felt on dependency ratios in the workforce. With a smaller pipeline of new workforce entrants and a burgeoning population of seniors, this changing ratio is one of the most significant stories impacting urban demographics.

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Chart of the Week

How the Modern Consumer is Different

We all have a stereotypical image of the average consumer – but is it an accurate one? Meet the modern consumer, and what it means for business.

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How the Modern Consumer is Different

How the Modern Consumer is Different

There is a prevailing wisdom that says the stereotypical American consumer can be defined by certain characteristics.

Based on what popular culture tells us, as well as years of experiences and data, we all have an idea of what the average consumer might look for in a house, car, restaurant, or shopping center.

But as circumstances change, so do consumer tastes – and according to a recent report by Deloitte, the modern consumer is becoming increasingly distinct from those of years past. For us to truly understand how these changes will affect the marketplace and our investments, we need to rethink and update our image of the modern consumer.

A Changing Consumer Base

In their analysis, Deloitte leans heavily on big picture demographic and economic factors to help in summarizing the three major ways in which consumers are changing.

Here are three ways the new consumer is different than in years past:

1. Increasingly Diverse
In terms of ethnicity, the Baby Boomers are 75% white, while the Millennial generation is 56% white. This diversity also transfers to other areas as well, such as sexual and gender identities.

Not surprisingly, future generations are expected to be even more heterogeneous – Gen Z, for example, identifies as being 49% non-white.

2. Under Greater Financial Pressure
Today’s consumers are more educated than ever before, but it’s come at a stiff price. In fact, the cost of education has increased by 65% between 2007 and 2017, and this has translated to a record-setting $1.5 trillion in student loans on the books.

Other costs have mounted as well, leaving the bottom 80% of consumers with effectively no increase in discretionary income over the last decade. To make matters worse, if you single out just the bottom 40% of earners, they actually have less discretionary income to spend than they did back in 2007.

3. Delaying Key Life Milestones
Getting married, having children, and buying a house all have one major thing in common: they can be expensive.

The average person under 35 years old has a 34% lower net worth than they would have had in the 1990s, making it harder to tackle typical adult milestones. In fact, the average couple today is marrying eight years later than they did in 1965, while the U.S. birthrate is at its lowest point in three decades. Meanwhile, homeownership for those aged 24-32 has dropped by 9% since 2005.

A New Landscape for Business?

The modern consumer base is more diverse, but also must deal with increased financial pressures and a delayed start in achieving traditional milestones of adulthood. These demographic and economic factors ultimately have a ripple effect down to businesses and investors.

How do these big picture changes impact your business or investments?

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