More Euro Crisis Migration

On Monday, I blogged about the migration of talent from Greece to Germany because of the current financial crisis. At a large scale, the move from Spain (another distressed country) to Germany is easily explained in terms of economic rationale. See this graph about the difference in unemployment in the respective countries. We can understand leaving Spain for Germany as a rational choice. At a finer scale, a rational choice theory of migration begins to fall apart. Exactly where these refugees end up in Germany is mostly a matter of network migration:

The Spanish government encourages job-seekers to leave. In January, it signed a cooperation agreement with Germany to push German companies to offer jobs in Germany to out-of-work Spaniards, focusing on the engineering, health and tourism sectors. The arrangement got a publicity boost when German Chancellor Angela Merkel visited Spain to meet with Prime Minister José Luis Rodgríguez Zapatero to discuss the matter, among other topics.

Eduardo Rodríguez-Priego, a 37-year-old civil engineer from Madrid, moved to Frankfurt in late 2009 after losing his job at a Spanish real-estate company. He had a brother already living in the German financial capital and decided to try his luck there after nine months of a fruitless search for a job in Spain.

"Four months later I found a job, even though I didn't speak any German," Mr. Rodríguez-Priego said.

Rodríguez-Priego moved to Frankfurt without a job. He could have gone to Berlin. But his brother lives in Frankfurt and is part of his network. Statistically, we see the brain drain from Spain and the brain gain in Germany. Doing so, we completely overlook an important migration pattern.

There may be a number of companies elsewhere in Germany even more desperate for talent. The wages might be better. The skills needed could be a better fit for the unemployed in Spain. There may even be a glut of workers in Frankfurt. What's missing is an established pathway to those jobs in lesser known regions.

Those lesser known regions strive to rebrand and build amenities like you find in Frankfurt. They preach and practice more tolerance. They embrace the Creative Class. And the talent keeps moving to Frankfurt.

So, businesses in those lesser known regions move to Frankfurt because that's where the talent is. Legacy migration is funny. It doesn't care about your youth groups or cool city initiatives. People go where they know.