Reverse brain drain: Economic shifts lure migrants home

The tide of brain drain – from developing countries to industrialized nations – has turned. Human capital is returning home to Asia, Latin America, Eastern Europe, and Africa, while some European professionals squeezed by the recession, turn toward developing countries for advancement.

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"Brain drain" – the flow of intellect and skilled labor from poor to rich countries – has been so constant in modern times that the Nigerian cabdriver who was educated as a doctor back home is just as much a fixture of New York City's landscape as a fledgling Broadway actress or Wall Street banker.

Academics and college-educated engineers from Brazil to China to Poland have long set off for the world's more developed nations for better opportunities, sometimes in their own fields, often behind steering wheels or in fast-food or restaurant kitchens.

Indeed, over time about 75 percent of international migrants typically moved to a country with a higher level of human development than their country of origin, according to the United Nations Development Fund.

But now that tide is turning; immigrants no longer always see developed countries as a better place to be. This U-turn – a "brain gain" for developing countries – features people like Kenyan Sitati Kituyi, who opted to get off the high-powered consultancy ladder in London for a tech start-up in Africa. Or Han Jie, an entrepreneur, lured home to China from the United States with government incentives to set up a medical-equipment factory. Or Bernardo Fontoura, a young Portuguese in business communications, who moved to Rio de Janeiro to be part of what he calls Brazil's "golden age" as it readies for the 2014 World Cup and 2016 Olympics.

The financial crisis that began in 2008 has tested middle-class America's sense of stability and the European right to social welfare. It has also caused many to question whether the developed world is still the only land of opportunity worth migrating to.

Emerging economies not only are faring better than most of the developed world in the current recession, they also continue to grow, drawing back their expatriates and, in some cases, even luring new high-skilled citizens of the US and Europe.

It is the "democratization of talent," says Demetrios Papademetriou, president of the nonprofit Migration Policy Institute in Washington, D.C. "Everyone went to four or five English-speaking countries before, [and all other nations] got the third-rung talent. Today, knowledge is no longer monopolized anywhere."

China has the world's largest diaspora, but as it has emerged as a global power – along with the other so-called BRIC nations Brazil, Russia, and India – the government has made a new push to woo back the millions of citizens who had left the country over the past 30 years. The array of financial and other incentives to tempt them home is unmatched anywhere else in the world and is proving to be the icing on the cake of economic growth and opportunity that Chinese expatriates are rushing home to devour: The number of people coming home each year, rather than staying on to work in their host country, has risen more than 10-fold since the beginning of the century.

Brazil is also drawing its expatriates home, and coming with them are many Europeans, a major role reversal between Europe and its "old colonies" of Latin America, such as Argentina, Brazil, and Mexico.

The number of foreigners living legally in Brazil rose by more than 50 percent between 2010 and April 2012, many of them from Portugal, making it a nation of immigration, after years of sustained emigration.

"What we are seeing is what appears to be European skilled migration to developing countries, like BRIC countries," says Ryszard Cholewinski, a specialist on migration policy at the International Labor Organization. "Given the economic crisis in Europe," he says, especially for young people in southern Europe, "opportunity for them now exists in the developing world."

Brain drain has been devastating for African nations, where waves of emigration started in the 1960s. Today, up to a quarter of foreign-trained health professionals working in western countries are from sub-Saharan Africa, according to the International Office on Migration. But some African diasporas are now beginning to return home, attracted by better opportunities, increasing political security, and a growing market buoyed by the spread of technology.

Manny Aniebonam, founder of the Nigerian Diaspora Alumni Network, estimates that twice as many people are returning to Nigeria today as are leaving. Angel Jones, founder of Homecoming Revolution in South Africa, a nonprofit established to lure expatriates home, says 6,000 South Africans have returned since 2004.

Even poorer countries of the European Union, which dealt with a sudden drain to the more developed countries when they joined the Union, are hoping that the financial crisis will position them to draw their lost migrants back. In 2004, with Polish accession to the EU, college graduates from Warsaw to Krakow and rural lands in between flocked to Ireland and England, often finding themselves with no other choices than to work as plumbers or waiters. Now, a steady trickle – especially of high-skilled executives – is returning to cash in on the potential of post-communist Poland, and there is a "circulatory" population of mobile middle-class migrants to and from European nations.

Becoming a recipient of brain gain implies new responsibilities that often cause growing pains, such as preventing human rights abuses of illegal workers or discouraging new xenophobic discourse. The Brazilian government estimates that fully half of the 4 million nationals living abroad in 2005 have returned home. Many of them are unskilled workers pushed home by harsher immigration rules and the stagnant job market in the US. And they've been joined by tens of thousands of low-skilled Bolivian and Paraguayan workers drawn by Brazil's growth.

But Brazil, China, Poland, Kenya, and other traditional exporters of human capital have less pain than gain as destinations because the flows create a positive ripple effect, says Vivek Wadhwa, author of the new book "The Immigrant Exodus," which focuses on Indian and Chinese entrepreneurs leaving the US for home. "They start building communities," he says. "It makes it easier for other people to go back."

Benefits are not just measured in the individuals' skills or number of jobs generated but also in a host of ancillary benefits.

"When you've lived in an OECD country and you see how things work there, I would think you become less tolerant of a corruption, of things that don't work, inefficiency, people sitting on their thumbs," says Georges Lemaitre, an expert on workforce migration at the Organization for Economic Cooperation and Development. "You want to see your own country with much more available services and with the efficiency that you are used to."

Such benefits, he adds, could become a global pattern in coming years, both from new migration and reverse migration.

In the meantime, those countries losing their allure could also lose their competitive edge.

"It is already costing America economic growth. Over time you will see fewer and fewer start-ups in America and more in Asia and Latin America," says Mr. Papademetriou. "The US has never seen an exodus before. It takes pride in being a land of immigrants, not a land of emigrants."