Thursday, August 27, 2009

Brain Drain Report

While the dominant policy narrative continues to be retention, I'm seeing more and more discussion about talent attraction and boomerang migration. Instead of the usual lowlights in Tallahassee, Olean, Philadelphia, or the entire state of Michigan, I'll highlight a few of the more promising developments in the ebb and flow of human capital.

The problem in the Rust Belt is the inability to make peace with the migration data. This keeps Collegia and Next Generation Consulting in business. I'll let a scholar at the University of Wisconsin-Madison do the talking:

Contrary to popular belief about so-called brain drain in the Midwest, exodus of college-educated workers from the region does not appear to be much more severe than out-migration from states in other parts of the country. Economically distressed Michigan, for example, has about the same rate of retention of college graduates as Virginia or Massachusetts. And while younger college-educated workers from the Midwest are more likely to be working outside their home states than the national average, as they enter their late 30s and beyond, they're less likely, indicating they tend to return home later in life.

Rust Belt talent is more likely to boomerang back home. That would seem to be a better use of resources, which is what Dr. John Kennan suggests. Someone in Lexington, KY is paying attention:

Many lament a so-called "brain drain" of talent from cities as college graduates leave college towns like Lexington for the big city. Many have interpreted research by the likes of Richard Florida and others to mean that to compete in a 21st century economy; we must retain and attract these people. However, the facts paint a somewhat different picture. Kauffman foundation research shows entrepreneurship rates are the lowest among those 20-34. The fastest growing segment is among those ages 45 and above. The typical entrepreneurial, creative type is 40 years old, married with at least one child. This holds true even for web technology startups. While Facebook may have been founded by a college-aged guy, Twitter's co-founders were all in their mid-30s. The facts indicate that those just out of college are likely to always be pulled in the direction of the opportunity to live and work in big cities. However, as they get older, get married and potentially look at having kids, many creative types will look for areas of the country with a lower cost of living and high standards of living. This is where cities like Lexington can compete. With a low cost of doing business and a solid quality of life, Lexington should be focused on attracting creative types as they get into their 30s. It is not about having more bars in downtown, it is about having diverse entertainment options including family friendly ones and doing a better job of promoting the options we already have. In fact, Lexington is attracting these types of creative individual; it just isn't publicized or recognized. The creative types in their 30s and 40s are more financially secure and have the experience necessary to be successful as an entrepreneur. Statistics show they will be more likely to start a business then they would have been in their 20s.

Instead of spending some much time, energy and money on those who would leave, how about funneling all of it towards those who would come back?

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