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Gaining in the Brain Drain

Indian Aayush Phumbhra co-founded Chegg, a textbook rental service startup in Silicon Valley. Public Use.

The formula seems simple: if a country has more smart people, it will have more wealth. Unsurprisingly then, many Americans sounded the alarm in light of recent statistics showing that highly educated immigrants are moving back to their home countries soon after graduating from US institutions. The migration of intelligent citizens from developing countries to rich Western ones has been widely documented, and has even received the moniker ‘the brain drain’. The reversal in that trend seems to imply a loss of valuable human capital for the US. But this isn’t entirely true. In an increasingly networked world where knowledge and innovation transcend national borders, the US isn’t seeing the effects of a ‘reverse brain drain,’ but rather a brain circulation, drawing a multitude of benefits from a constant back-and-forth of ideas.

In STEM sectors specifically, immigrants’ contributions to innovation in the US cannot be understated. In fact, immigrants form the backbone of the US start-up industry. A 2011 study showed that they either founded or co-founded 23 of the 50 top start-up companies and more than half of these companies had one or more immigrants in management positions. They also comprise large portions of other industries besides start-ups; in select regions, they account for more than 15 percent of the workforce in health-related industries. Losing talented professionals in these sectors definitely has consequences for the US.

Many cite America’s immigration policy as a major push factor driving immigrants away after graduation or only a few years of work. This supposedly stalls entrepreneurship and innovation in the US. With the temporary employment H-1B visa, immigrants are permitted to work here for three years given that they are tied to specific employers, who must petition the government for them to work. After the H-1B visa expires, they can either reapply or apply for a green card, a process that can take up to 10 years.

Though these onerous procedures are an easy target for people looking for an explanation as to why talented professionals are leaving the country, the reality is that while immigration processes may be cumbersome, they aren’t forceful enough to become a significant part of immigrants’ decision to leave. Much stronger than the push from the US is the pull from back home. The economic growth of countries like China and India is magnetic for up-and-coming entrepreneurs. Both countries have come far from abysmal annual growth rates just a few decades ago, and in the last ten years, have maintained spectacular average annual growth rates of about 7 to 11 percent. This upward economic trajectory has provided them with the infrastructure to support employment expansion and presents a major incentive for emigrants studying or working in the US to return. Post-graduation opportunities in such rapidly growing economies are endless, and their governments are actively introducing measures to reel back their American-educated sons and daughters. Shanghai, for example, has allowed its top firms to attract Chinese graduates overseas by offering them salaries that match or top those offered by foreign firms.

Immigrants’ dominance in vital industries—particularly start-ups, which are largely responsible for the US economy’s net annual job growth—is the reason for some Americans’ concern that when these immigrants leave the US for home, they will take their knowledge and innovative ideas with them. Statements parroting the “stop the US brain drain” refrain are common, but unnecessary to a certain extent. While congressmen argue over whether or not to make it easier to obtain the H-1B visa, we should recognize that while immigration reform would be good for immigrants (and is likely to happen this year), the current trend offers benefits of a different kind.

Much attention is given to the fact that well-educated immigrants are leaving, but not much is given to what they do in their careers afterwards. The notion that one’s work is permanently tied to a specific country doesn’t hold any more, according to Rachel Friedberg, professor of economics at Brown. A new and popular career path for these immigrants is to obtain the H-1B visa, work in the US for a few years after graduation for experience and networking purposes, and then move back to their home countries for greater career opportunities.

But the movement of knowledge and ideas, or the “brain,” doesn’t stop there. These former immigrants live increasingly transnational lives. They constantly engage in networking with their past American employers, sometimes physically going back and forth to facilitate the exchange of ideas, knowledge, and skill between the US and rapidly growing developing countries. In this sense, former immigrants act as a bridge between the developed and quickly developing worlds. To their home countries, they bring the conventional knowledge and methodology needed for things like entrepreneurial and venture projects. To the US, they bring innovation and a vigorous mindset and work ethic that may be special to the cultures of the world’s most rapidly developing countries—and an economic connection to some of these nations.

In the 21st Century, the movement of knowledge and ideas follows a circular pattern rather than a linear one. With faster and cheaper travel, instantaneous communication and the Internet, the brain is no longer the property of its home country, and is no longer bound by national borders. Where it originates from and where it resides no longer correlate with who will benefit from their ideas. Though the urge to reform immigration policy in order to retain talented immigrants is admirable, the philosophy behind it is misguided. We live in a global village, where the pattern for all types of exchange is circulation, and one person’s gain doesn’t translate to another’s drain.

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