Are We Now in the "Brain Circulation" Era? (UPDATED)

UPDATE:

Related in more ways than one to the “brain drain,” especially as it affects our young people, is a “brain waste.”

Paul Krugman addresses how some of our policies are contributing to “wasting the minds of a whole generation.”

Please read it here

Original Post:

The unemployment in Spain “just hit a depression-level 24.4 percent.”

Portugal, and Greece are not faring much better.

Meanwhile in the Heilbronn-Franken region alone — in a Germany presently boasting Europe’s most thriving economy — 7,500 jobs, everything from health care to hospitality, but especially engineers, go begging.

The rest of Germany is not much different : “While much of southern Europe is struggling with soaring unemployment rates, a robust Germany is desperate for educated workers, and it has begun to look south for the solution,” says the New York Times in an interesting article this weekend.

It is thus not surprising to hear that thousands of workers from southern Europe are coming to Germany in search of jobs and a better future in what can be described as another “brain drain.”

It seems like these difficult and uncertain economic times and the changing fortunes of nations are causing the movements of people, and their talents, in unexpected ways and directions.

Recently, the United States — always a magnet for people from all over the world — is experiencing what some call a “reverse brain drain” as we are seeing an increasing number of highly educated and skilled sons and daughters, grandsons and granddaughters, of Indian, Chinese, Russian, Brazilian immigrants returning to their ancestral countries where new and plenty of opportunities beckon.

Similarly, a few days ago there were reports that for the first time since the Depression more Mexicans are returning to Mexico than coming to the United States.

As to the reasons for this most recent reversal, the Mexican reverse migration, sources attribute it to, among others, a weak U.S. job and housing construction market, stricter border enforcement, improving social conditions in Mexico, a decline in Mexican birthrates.

The movement of labor, skills and “brains” across borders and continents is nothing new.

While the British Royal Society first coined the expression “brain drain” to describe the outflow of scientists and technologists to the United States and Canada in the 1950s and early 1960s from post-war Europe, such a migration of skills and talents can probably be traced to the earliest of times.

Wikipedia cites the seeking of protection by members of the closed (Neoplatonic) “Academy” in AD 529 under the rule of Sassanid king Khosrau I, “carrying with them precious scrolls of literature and philosophy, and to a lesser degree of science” as a historical example of brain drain.

As socio-economic fortunes change, and with the relative ease of travel and free movement of people — especially in the European Union and the “free world” — some scholars and business leaders claim that all these back-and-forth “brain movements” ( they refer to them as “brain circulation”) are not necessarily bad for the country “losing the brains.” Why? Because, for example, these young American entrepreneurial émigrés sow American knowledge and skills abroad and in return acquire experience overseas and build networks that they can carry back to the United States or elsewhere .

But back in Germany and especially in the southern European countries presently watching their young, talented people leave, there are some concerns. The Times:

“This generation of young people who are leaving are our best qualified ever,” said César Castel, the director of operations for the Spanish branch of Adecco, a Swiss headhunting firm. “It is a huge loss of investment for Spain. On average it cost us 60,000 euros to train each engineer, and they are leaving.” That is about $80,000.

Mr. Castel says that if Spain’s economy turns around in two years, he expects 90 percent of the Spanish professionals to return home. However, “[I]f the recession holds on longer, the figures could drop precipitously as the workers marry and have children abroad. He fears a situation where the northern economies retain industry and the southern ones are left with agriculture and tourism,” according to the Times.

Peter Fenkl, the president of the executive board of the German company Ziehl-Abegg, looks at this issue from an opposite perspective: “If they leave in a year or two, that is not good.” Fenkl estimates that it costs as much as $50,000 more to train and integrate a foreign worker than it does a German. “But the company has little choice — having enough highly trained workers to fill orders is a necessity,” says the Times.

But so far the brain drain seems to be going as well as can be expected for both sides — under the circumstances.

To the unemployed masses in the south, Germany’s needs are a relief. In Baden-Württemberg, the unemployment rate is just 4 percent. The country seems like “El Dorado,” the legendary lost city of gold, said one Spanish engineer still searching for a job in Schwäbisch Hall. For the most part, engineers are being offered twice the salaries they could make in Spain, he said, though taxes are higher in Germany.

Of course there are some cultural, language and other issues, but — mindful of past experiences with integrating foreign workers– “[t]oday, many government officials and business leaders are examining Germany’s culture, eager to do what it takes to be hospitable and acknowledging that they have not always been so.”

“We need to become a welcoming culture,” said Guido Rebstock, head of the jobs agency in Schwäbisch Hall, repeating a phrase that has become part of the vocabulary here. “The firms have to help the workers with more than their jobs.”

Schwäbisch Hall is the “postcard-perfect” town in the Heilbronn-Franken region that in the last 18 months has “recruited thousands of the Continent’s best and brightest.”

Hopefully, when the economies in Europe recover and most of the émigrés return home, the previously mentioned benefits of the new “brain circulation” will be realized.