Sunday, June 20, 2010

War For Talent: Michigan

Brain drain is good for Michigan. At least, this study suggests that there isn't any evidence that brain drain is bad. (Via Demography Matters) One social scientist considers outmigration to be an important part of Michigan's economic recovery:

In other words, [Olivier Blanchard and Lawrence Katz] find that the US labor market is fairly well integrated, and an extended period of unemployment and low wages leads workers to seek new opportunities in other regions. (Here is a recent book by Katz and a collaborator; The Race between Education and Technology.) ...

... [250,000 out-migrants from the labor force] is a significant but not overwhelming loss of population -- about 5%. And the number of jobs required on this scenario is moderate and achievable -- 150,000 new jobs in ten years. This amounts to about 4% jobs growth per year. We can make some educated guesses about the demographics of the population that leaves the state -- they are likely to be young, they are likely to have children, and they are likely to be better educated than the general population. So the economic and social impact of this exodus is likely to be greater than their 5% share of the general population. But all of that conceded, it would appear that there is a reasonably achievable pathway for Michigan to dig itself out of its current crisis.

Acute brain drain is rare. The conditions sparking an exodus of talent are at the extreme end of any recession. The economic push to leave is tremendous. The entire State of Michigan is unaware of the research.

The Grand Rapids Press kicked off a series about talent migration titled, "How do we create cool cities that retain talented Millennials?" Ugh. The suggestions will hurt Michigan more than they will help. The place-making strategies might work if the push factors of talent migration were not so strong. The Michigan labor market needs a structural adjustment.

Michigan can both shrink and raise the level of educational attainment. Inevitably, it is a matter of attraction. One of the stories in the series looks at that end of the migration equation. All the A-list cities mentioned in that article got brainy through attraction, not retention. Yet the side bar is all about those who leave the state. Grand Rapids does not have a "bright flight" problem:

On the plus side, Grand Valley State University, with campuses in downtown Grand Rapids and Allendale, boasts that 97 percent of its graduates stay in Michigan, either to work or to attend to graduate school here. That's far higher than colleges in the rest of the state: A recent Michigan Future survey of graduates showed about half flee Michigan within a year.

"I've lived in many places in my career, and talent drives communities," says GVSU President Thomas Haas, who attributes his university's high retention rate to a strong downtown presence and co-op and internship programs that link students with local businesses. "The more we wrap our arms around that, the more we can see the bright light at the end of the tunnel. We have to recruit it, we have to nurture it, and we have to retain it."

What ties all the Michigan communities together is a lack of talent attraction. Too much retention can be a bad thing. That's the case in Michigan. The problem is at its worst in Grand Rapids. The rub:

Young entrepreneur Daniel Estrada, president of D.C. Estrada, a Grand Rapids-based legal technology consulting firm, says to draw more inventive business minds, West Michigan must embrace change.

"I think Grand Rapids is too risk-averse and too much against change, and those things make a young professional starting a new career feel like an outsider," he says.

It sounds a lot like Pittsburgh save the lack of exodus during a devastating economic recession. There will be no inmigration without more outmigration. A lot more. The culture will remain risk averse. Little will change. Plugging the brain drain is a counterproductive policy.

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