BretLudwig
December 15th 08, 12:01 AM
The Reverse Brain Drain
Doug Saunders, Globe and Mail(Toronto), December 11, 2008
>>"Five months ago, Pankaj Dinodia was on top of the Wall Street boom: At
age 25, the Indian immigrant had made it through one of the top U.S.
business schools and held an important investment banking position with
Goldman Sachs.
Then, in the middle of the summer, he felt the calling. The future
didn’t look so good in the big Western markets, he decided. Those calls
from his family in New Delhi, urging him to come back and help out with
the family accounting business, sounded more sensible. So he gave up his
huge bonus and got on a plane.
At the time, his move from the world’s most successful investment bank
to the poky New Delhi offices of S.R. Dinodia & Co., Chartered
Accountants, bewildered his friends and colleagues: It was as if he had
abandoned his future.
Now they’re all phoning him.
People like Mr. Dinodia are pioneers in the “reverse brain drain,” a
huge shift of knowledge and skills out of New York and London and back
into the developing world. In one of the surprising consequences of the
global financial meltdown, the collapse of the Western banking and finance
industries has sent thousands of highly skilled professionals from
immigrant backgrounds back to their homelands, where they are taking on
key roles in emerging economies.
“I have ridden the bubble to the top and got out when things started
looking shaky, but a lot of my colleagues have lost their jobs . . . the
Lehman Brothers of the world, the Bear Stearns of the world are no longer
sucking up talent from India but instead sending it back,” Mr. Dinodia
said from New Delhi the other day.
“So companies here can now hire bankers with the kind of experience we
never could have dreamed of employing before the crunch.”
Precise figures of professionals returning home aren’t available, but
reverse migration has become a major issue in a number of countries. The
financial sectors in India and China are being bolstered by a reverse
exodus of highly trained but suddenly jobless bankers and analysts. Brazil
and Turkey have observed the same effect. The trend is also visible in
smaller developed countries, such as Israel and Australia, that have
avoided the worst of the crash.
And Malaysia may have gone the furthest in exploiting the phenomenon: Its
higher-education minister announced recently that his country’s
institutions should launch an international program “to identify
Malaysian professionals who lost their jobs abroad to return and work.”
The reversal is particularly dramatic in India, where human resource
managers for finance firms are reporting hundreds of résumés from New
York and London arriving on their desks each week.
Mr. Dinodia has found himself at the centre of this phenomenon. After he
arrived in India, he set up an online community for Indian-born graduates
of the Wharton School—the acclaimed University of Pennsylvania business
college where he’d earned his degree—to help them find positions in
India’s thriving financial sector if they wanted to move back.
He thought he would end up helping out maybe a couple of dozen people.
Then the markets collapsed. In the past six weeks, his network has helped
350 Wharton grads move back to India, using its circle of 50 India-based
mentors and “industry captains” to place them in high-level positions
in an economy that looks more promising, if a lot smaller, to many of
them.
It’s become a second job for him, even as he struggles to bring
structured financing and other tools of investment banking to his
fast-growing family firm.
As he spoke, he read a new e-mail from a former classmate: “I have nine
years of hedge fund experience on the public and private side; I’m happy
to come in anywhere, from analyst to vice-president, in any role, I’m
desperate; my kids go to a private school; I have a big mortgage; I’m
looking for any job in India in investing.”
According to a large-scale study of 1,200 Indian and Chinese returnees to
be published next month by Vivek Wadhwa, a U.S. immigration scholar and
consultant, the majority of people joining the reverse brain drain are
under 40, most have masters or doctorate degrees, and they’re generally
leaving because they believe prospects look better in the world’s poorer
half.
“These people seem to be doing better back home than they would have
done in the U.S.,” Mr. Wadhwa said. “More than 60 per cent of Indian
returnees and more than 80 per cent of Chinese returnees believe their
home countries offer better career and professional opportunities.”
Mr. Wadhwa worries that U.S. immigration policies are pushing the best
minds out of the country’s economy: Because the Green Card system only
gives residency status to immigrants who have permanent jobs, and does not
allow them to stay through a downturn, he believes the system is destroying
the competitive advantage of the United States. He estimates that one
million skilled foreign workers awaiting permanent residency visas in the
U.S. are likely to leave.
(Canada’s immigration system is more flexible for workers in this
position, but the Canadian banking system has not faced the collapse and
bailout that the U.S. and Britain have endured, so a mass departure of
foreign talent is less likely, experts say).
But a substantial number of the Indian and Chinese Americans headed
eastward hold U.S. or British citizenship: It appears that many of these
homeward-bound professionals aren’t simply victims of the crash, but
entrepreneurs hoping to use their accumulated savings from the boom years
to launch a wave of innovation in their home countries.
That’s how Mr. Dinodia saw it: “The plan was always to learn from the
best and the brightest, the Whartons and the Goldman Sachs of he world,
and then come back to the family business so that never again would a
client leave us for a fancy name tag,” he explained.
“Even though it’s a domestic firm, I wanted people to realize that we
have the best and the brightest brains within the firm itself.”
Something similar happened after the dot-com boom collapsed in 2000. Tens
of thousands of Indian software engineers, who had formed the intellectual
backbone of Silicon Valley’s period of vast growth and innovation,
decided to move back home en masse. They turned to entrepreneurship, and
their software companies ended up launching the great outsourcing boom of
recent years, sending millions of jobs back to India.
There’s good reason to return eastward these days. While India’s
economy is also hurting, some of its fundamentals appear stronger. Indian
companies, large and small, have avoided heavily leveraged loan finance,
and tend to be rich in cash.
Growth may have slowed, but it hasn’t stalled or gone negative.
Some returnees, like Mr. Dinodia, are realizing the dreams of parents who
never thought they’d be able to match the six-figure bonuses of Wall
Street and win their prodigal children back.
But for many others, the precise opposite is true.
“When I got on the plane and left the U.S. for India, my dad said, ‘I
worked my whole life to give you the opportunity to be educated and work
in the U.S., and the first thing you do after a few years of work is fly
right back to India,’ ” said Samvir Sidhu, also 25, who recently left
behind a Wall Street job—and his American citizenship—to join a
private equity firm in New Delhi.
“It was quite an ironic revelation.”<<
http://www.amren.com/mtnews/archives/2008/12/the_reverse_bra.php
--
Message posted using http://www.talkaboutaudio.com/group/rec.audio.opinion/
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Doug Saunders, Globe and Mail(Toronto), December 11, 2008
>>"Five months ago, Pankaj Dinodia was on top of the Wall Street boom: At
age 25, the Indian immigrant had made it through one of the top U.S.
business schools and held an important investment banking position with
Goldman Sachs.
Then, in the middle of the summer, he felt the calling. The future
didn’t look so good in the big Western markets, he decided. Those calls
from his family in New Delhi, urging him to come back and help out with
the family accounting business, sounded more sensible. So he gave up his
huge bonus and got on a plane.
At the time, his move from the world’s most successful investment bank
to the poky New Delhi offices of S.R. Dinodia & Co., Chartered
Accountants, bewildered his friends and colleagues: It was as if he had
abandoned his future.
Now they’re all phoning him.
People like Mr. Dinodia are pioneers in the “reverse brain drain,” a
huge shift of knowledge and skills out of New York and London and back
into the developing world. In one of the surprising consequences of the
global financial meltdown, the collapse of the Western banking and finance
industries has sent thousands of highly skilled professionals from
immigrant backgrounds back to their homelands, where they are taking on
key roles in emerging economies.
“I have ridden the bubble to the top and got out when things started
looking shaky, but a lot of my colleagues have lost their jobs . . . the
Lehman Brothers of the world, the Bear Stearns of the world are no longer
sucking up talent from India but instead sending it back,” Mr. Dinodia
said from New Delhi the other day.
“So companies here can now hire bankers with the kind of experience we
never could have dreamed of employing before the crunch.”
Precise figures of professionals returning home aren’t available, but
reverse migration has become a major issue in a number of countries. The
financial sectors in India and China are being bolstered by a reverse
exodus of highly trained but suddenly jobless bankers and analysts. Brazil
and Turkey have observed the same effect. The trend is also visible in
smaller developed countries, such as Israel and Australia, that have
avoided the worst of the crash.
And Malaysia may have gone the furthest in exploiting the phenomenon: Its
higher-education minister announced recently that his country’s
institutions should launch an international program “to identify
Malaysian professionals who lost their jobs abroad to return and work.”
The reversal is particularly dramatic in India, where human resource
managers for finance firms are reporting hundreds of résumés from New
York and London arriving on their desks each week.
Mr. Dinodia has found himself at the centre of this phenomenon. After he
arrived in India, he set up an online community for Indian-born graduates
of the Wharton School—the acclaimed University of Pennsylvania business
college where he’d earned his degree—to help them find positions in
India’s thriving financial sector if they wanted to move back.
He thought he would end up helping out maybe a couple of dozen people.
Then the markets collapsed. In the past six weeks, his network has helped
350 Wharton grads move back to India, using its circle of 50 India-based
mentors and “industry captains” to place them in high-level positions
in an economy that looks more promising, if a lot smaller, to many of
them.
It’s become a second job for him, even as he struggles to bring
structured financing and other tools of investment banking to his
fast-growing family firm.
As he spoke, he read a new e-mail from a former classmate: “I have nine
years of hedge fund experience on the public and private side; I’m happy
to come in anywhere, from analyst to vice-president, in any role, I’m
desperate; my kids go to a private school; I have a big mortgage; I’m
looking for any job in India in investing.”
According to a large-scale study of 1,200 Indian and Chinese returnees to
be published next month by Vivek Wadhwa, a U.S. immigration scholar and
consultant, the majority of people joining the reverse brain drain are
under 40, most have masters or doctorate degrees, and they’re generally
leaving because they believe prospects look better in the world’s poorer
half.
“These people seem to be doing better back home than they would have
done in the U.S.,” Mr. Wadhwa said. “More than 60 per cent of Indian
returnees and more than 80 per cent of Chinese returnees believe their
home countries offer better career and professional opportunities.”
Mr. Wadhwa worries that U.S. immigration policies are pushing the best
minds out of the country’s economy: Because the Green Card system only
gives residency status to immigrants who have permanent jobs, and does not
allow them to stay through a downturn, he believes the system is destroying
the competitive advantage of the United States. He estimates that one
million skilled foreign workers awaiting permanent residency visas in the
U.S. are likely to leave.
(Canada’s immigration system is more flexible for workers in this
position, but the Canadian banking system has not faced the collapse and
bailout that the U.S. and Britain have endured, so a mass departure of
foreign talent is less likely, experts say).
But a substantial number of the Indian and Chinese Americans headed
eastward hold U.S. or British citizenship: It appears that many of these
homeward-bound professionals aren’t simply victims of the crash, but
entrepreneurs hoping to use their accumulated savings from the boom years
to launch a wave of innovation in their home countries.
That’s how Mr. Dinodia saw it: “The plan was always to learn from the
best and the brightest, the Whartons and the Goldman Sachs of he world,
and then come back to the family business so that never again would a
client leave us for a fancy name tag,” he explained.
“Even though it’s a domestic firm, I wanted people to realize that we
have the best and the brightest brains within the firm itself.”
Something similar happened after the dot-com boom collapsed in 2000. Tens
of thousands of Indian software engineers, who had formed the intellectual
backbone of Silicon Valley’s period of vast growth and innovation,
decided to move back home en masse. They turned to entrepreneurship, and
their software companies ended up launching the great outsourcing boom of
recent years, sending millions of jobs back to India.
There’s good reason to return eastward these days. While India’s
economy is also hurting, some of its fundamentals appear stronger. Indian
companies, large and small, have avoided heavily leveraged loan finance,
and tend to be rich in cash.
Growth may have slowed, but it hasn’t stalled or gone negative.
Some returnees, like Mr. Dinodia, are realizing the dreams of parents who
never thought they’d be able to match the six-figure bonuses of Wall
Street and win their prodigal children back.
But for many others, the precise opposite is true.
“When I got on the plane and left the U.S. for India, my dad said, ‘I
worked my whole life to give you the opportunity to be educated and work
in the U.S., and the first thing you do after a few years of work is fly
right back to India,’ ” said Samvir Sidhu, also 25, who recently left
behind a Wall Street job—and his American citizenship—to join a
private equity firm in New Delhi.
“It was quite an ironic revelation.”<<
http://www.amren.com/mtnews/archives/2008/12/the_reverse_bra.php
--
Message posted using http://www.talkaboutaudio.com/group/rec.audio.opinion/
More information at http://www.talkaboutaudio.com/faq.html