What is Brain Circulation, Brain Drain, Brain Gain, and Brain Waste?

Labor migration, or the movement of workers from one area to another, often involves the transfer or exchange of skilled individuals between nations. Migration researchers use a number of terms to describe the effects of these movements. One of the most common is brain drain, sometimes called human capital flight. Brain drain refers to a persistent loss of highly trained and highly skilled individuals to other nations. Brain gain is the reverse: an influx of talented foreign workers.

The notions of brain drain and brain gain are based on the idea of labor migration as a zero-sum game in which one nation suffers while another benefits. But, in an increasingly globalized and interconnected world, theorists have also introduced the idea that home countries can gain valuable knowledge and relationships by sending their most skilled workers abroad. This mutually beneficial scenario is known as brain circulation. When a host country fails to maximize the potential of skilled foreign workers, however, both countries may end up losing. This phenomenon is known as brain waste.

The concepts of brain drain, gain, circulation, and waste have been widely studied and debated due to their relationship to what researchers call the migration-development nexus. This refers to the study of how migration affects the economic and human development of both home and host countries. Prior to the late 20th century, researchers and policy makers largely assumed that brain drain was bad for developing nations. But, around the turn of the 21st century, researchers began to suggest that the migration of skilled workers can benefit both developing and developed nations when certain conditions are met.

Historical Background

Although the concept of brain drain was not introduced in migration studies until the 1960s, there are numerous historical examples of large-scale losses of human capital caused by forced and voluntary migrations. When the ancient Romans conquered Greece in the 2nd and 1st centuries BCE, for example, many Greek scholars abandoned learning centers in Athens and Alexandria for Rome.

Likewise, the forced expulsion of Jews and Muslims from Spain between 1492 and 1609 resulted in a significant loss of expertise in science, math, philosophy, medicine, and finance. The expulsion also coincided with a period of economic decline throughout the Spanish Empire. Many of those expelled were welcomed in the Ottoman Empire by Sultan Bayezid II (c. 1447–1512), who is said to have celebrated the brain gain by declaring that Spanish king Ferdinand II of Aragon (1452–1516) had impoverished his country while enriching the Ottoman Empire.

Brain Gain after World War I

Following World War I (1914–1918) the United States benefited from a major brain gain caused by migrations from Europe. Many prominent thinkers immigrated to the United States in the 1920s and 1930s in response to rising political and economic tensions during the buildup to World War II (1939–1945). Russian sociologist Pitirim Sorokin (1889–1968), for example, was expelled from the newly formed Soviet Union in 1923 as part of a purge of anticommunist intellectuals. In 1930 he founded the sociology department at Harvard University.

Scientists of Jewish descent, including Albert Einstein (1879–1955) and Otto Loewi (1873–1961), also fled to the United States in the 1930s and 1940s to escape anti-Semitism and the rise of the Nazi Party in Germany. Immigrant scientists were major contributors to the war effort, including the development of the atomic bomb, and helped transform the United States into a scientific and industrial powerhouse by mid-century.

Post–World War II Concern with Brain Drain
In the decades after World War II, the immigration of European scientists and engineers to the United States remained high. In 1963 the United Kingdom's leading scientific organization, the Royal Society of London for Improving Natural Knowledge, issued a report titled Emigration of Scientists from the United Kingdom. The report stated that about 60 university staff and 140 recent PhDs were leaving the United Kingdom each year for opportunities in the United States and causing “serious gaps in the scientific effort of this country” that could have “serious economic consequences.” The Royal Society's findings prompted a series of debates and newspaper articles, including one by the Evening Standard coining the term brain drain.

 

WORDS TO KNOW

ANTI-SEMITISM:
A hostility or prejudice against Jewish people.
DEVELOPED NATIONS:
Countries with high levels of gross national income (GNI).
DEVELOPING NATIONS:
Also called emerging economies, these are countries with low to middle levels of gross national income (GNI).
FORCED MIGRATION:
The movement of people out of the region in which they live because of conflict, natural disasters, human-made disasters, or development projects.
HUMAN CAPITAL:
The accumulated knowledge, skills, and abilities possessed by an individual or group.
IMMIGRATION ACT OF 1965:
Also known as the Hart-Celler Act and the Immigration and Nationality Act, this law established a new immigration policy aimed at recruiting skilled labor and uniting immigrant family members.
MUTUAL RECOGNITION AGREEMENT:
An agreement between two or more countries or organizations stating that licenses, certifications, or other forms of accreditation granted by each group will be treated as equally valid.
REMITTANCE:
Payment sent to someone at a distance, particularly from immigrants to family in their countries of origin.
UNDEREMPLOYMENT:
Employment in a job or industry that does not require the high level of education or training possessed by an employee.
VOLUNTARY MIGRATION:
The movement of individuals or groups under their own free will and without coercion from outside forces.

 

Concern over the potential effects of brain drain led to an effort by the UK government to improve its ability to collect data on migration patterns but resulted in few policy changes. By the early 1970s the phenomenon had largely shifted to the developing world and was driven by a massive increase in demand for health-care professionals among Western nations. New immigration laws, such as the US Immigration Act of 1965, reduced restrictions on immigration from countries in Africa and Asia and prioritized immigrants with postsecondary education, initiating a sharp rise in skilled migration from developing countries.

In 1975 the United Nations Conference on Trade and Development estimated that 300,000 skilled migrants had emigrated from developing nations to developed nations. By 1990, according to Sari Pekkala Kerr and colleagues in “Global Talent Flows” (2016), the number of college educated emigrants from developing to developed nations had grown to 6.2 million. By 2010 the number had reached 17.6 million. India and the Philippines were the largest sources of skilled migrants in 2010, at 2.1 million and 1.5 million, respectively. As a percentage of skilled workers, however, low-income Caribbean nations were among the most significantly affected by brain drain, with 93 percent of skilled workers in Guyana, 68 percent in Trinidad and Tobago, and 66 percent in Barbados emigrating to other nations.

Reassessment of Skilled Migration in the Late 20th Century

Many early studies of brain drain argued that wealthy nations were simply continuing the centuries-old practice of exploiting resources from the developing world to promote their own economic growth. Although source nations may benefit from increased income from remittances, the loss of human capital and the unreim-bursed public costs of educating skilled migrants were thought to be significant obstacles to growth. To address such concerns, economist Jagdish Bhagwati (1934–) in the early 1970s advocated for a tax on the incomes of skilled migrants to be sent to their country of origin. Although it was never implemented, the so-called Bhagwati tax remained a topic of debate among economists and migration experts.

In the 1980s and 1990s, however, many researchers began to suggest that previous estimates of the impact of brain drain on developing nations were flawed because they assumed that all migrations were permanent. In fact, research has shown that as many as half of all migrants return home within five years, bringing their refined skills, knowledge, wealth, and relationships with them. Even migrants who remain in the destination country may transfer knowledge back to the home country or otherwise contribute to economic growth such as by outsourcing work to the home country.

Countries that experienced significant economic benefits from this type of brain circulation in the 1980s and 1990s included Ireland, South Korea, and Taiwan, followed by China and India in the 21st century. Yet as the flow of skilled migrants to developed nations steadily increased, a new concern began to emerge. Particularly after the global financial crisis of 2008–2009, increasing numbers of highly educated migrants were struggling to find work in their field. Many were forced to take low-skill positions or remained unemployed.

This underutilization of talent, known as brain waste, has several economic and social consequences both in the host country and for the global economy at large. In the United States, for example, nearly 2 million skilled migrants, or 25 percent of the entire skilled migrant population, were in low-skill positions or unemployed as of 2015, according to Jeanne Batalova and colleagues in their 2016 report for the Migration Policy Institute. This resulted in a loss of approximately $10 billion in potential tax revenues for the United States and more than $39 billion in potential wages for the immigrants themselves.

Impacts and Issues

In the 21st century emigration of skilled workers continued to have consequences for source nations. Brain drain is most pronounced in health care, and many developing nations lack access to vital medical services. In Malawi, for example, high rates of emigration among doctors and nurses led to a severe shortage of medical professionals: the population of nearly 17 million was served by only 2,200 medical professionals as of 2016, according to the nonprofit research group Africa Check. That averages approximately 0.12 health-care providers for every 1,000 people, far below the minimum level of 2.3 per 1,000 recommended by the World Health Organization.

Developed nations may also experience some negative effects resulting from brain gain. Immigration critics often claim that skilled migrants displace native workers and drive down wages in specialized industries. In October 2014, for example, 250 tech workers at the US-based Walt Disney Company were replaced by temporary foreign workers at lower wages. Similar scenarios occurred at such companies as Toys “R” Us, Hertz, Southern California Edison, New York Life, and others. This led to lawsuits and congressional hearings over alleged abuses of the US skilled worker visa program, but as of 2017 no major policy changes had been enacted.

Several researchers have offered proposals to address the potential negative effects of skilled migration and brain drain. Policy options for destination countries include increasing investment in training programs for domestic workers, restricting the ability of companies to recruit in countries that are hardest hit by brain drain, and requiring businesses or governments to compensate source countries for the costs associated with training skilled migrants.

Researchers have also outlined several options to increase developing nations' ability to retain skilled workers. These include offering nonmonetary compensation, such as free education, to the children of skilled individuals who remain in the country, improving national infrastructure, and allowing government employees to increase their income by also working in the private sector. Perhaps the most controversial proposal, offered by Gillian Brock and Michael Blake in Debating Brain Drain: May Governments Restrict Emigration? (2015), is to require recently trained workers in industries threatened by brain drain to work in their home country for a set period, an option known as compulsory work requirements, or bonding.

However, few of these proposals have been implemented on a large scale, and even fewer have proven successful. Compensation schemes and migration restrictions are difficult to implement because they rely on increased government involvement in private industry and the movement of private individuals. Differences in national political views or in the ability of governments to conduct such oversight mean that the cost of implementing such schemes often outweighs the potential benefit. Instead, many developing nations now rely on incentives to entice skilled migrants to return home after a short period abroad.

How Brain Circulation Can Improve Development

Despite the potential for service shortages and worker displacement in home and host countries, skilled migration is generally seen as a net benefit to the global economy. Although some skilled migrants may be awarded jobs once held by domestic workers, businesses often create new supervisory roles for those who have been displaced. Skilled migrants may also create new jobs through entrepreneurship or increased consumption of goods. In addition, they help to address the growing gap between the skills needed in high-tech economies and those possessed by the workforce. The US Department of Labor, for example, predicted that by 2020 computer science graduates of US universities will fill less than one-third of the positions available in the high-tech industry.

Skilled migrants are increasingly following a pattern of brain circulation, returning to their countries of origin and helping to boost economic growth. The idea that brain circulation benefits all parties is related to the idea of a “threefold win.” In this model, skilled migrants benefit from increased incomes and valuable work experiences. Their countries of origin benefit from increased remittances, higher levels of exports to wealthy immigrant groups abroad, and economic growth spurred by the transfer of knowledge between countries and the eventual return of skilled migrants. Host countries benefit from an influx of top talent from around the world, which supports innovation and boosts tax revenues.

Another potential benefit from the emigration of skilled workers is “indirect brain gain.” That is, nations with high levels of skilled emigration may experience higher rates of human capital development. This occurs, in part, because of the increased incentive for individuals to pursue higher education in the hopes of seeking opportunities abroad. Because many of these individuals ultimately do not emigrate, their skills may contribute to economic development at home.

Risk of Brain Waste and the Social and Economic Impacts

For the threefold win theory to hold true, migrants must be employed in positions that fully use their skills and training. Brain waste is a growing problem in host countries. It eliminates nearly all benefits achieved by efficient brain circulation. Home countries absorb the cost of educating migrants but do not benefit from the application of those skills in domestic industries or from an increase in remittances or knowledge transfer. Host countries incur unnecessary costs in the public and private sectors as employers struggle to fill open positions and social services are used to support overeducated migrants earning low wages. Migrants are caught in limbo between accepting menial work in the host country or returning to a country where opportunity is scarce.

Brain waste does not affect all migrant groups the same. Migrants from Europe and Asia, for example, exhibit lower levels of brain waste in the United States than those from Latin America or Africa. In Western Europe, migrants from Africa and the Middle East are disproportionately affected by underemployment and unemployment. Female migrants are particularly at risk of underemployment in host countries.

The reasons for such disparities are not entirely understood but may include familiarity with the language of the host country, the distance between the home and host countries, the relative wealth of the home country, and the historical relationship between home and host countries. The International Organization for Migration stated that language proficiency is especially important to the employment prospects of skilled migrant women, as are social pressures such as the expectation that women be the primary caregivers to children in their families.

One of the most common obstacles to the full utilization of immigrant skills is failure to recognize foreign credentials in host countries. Professions that require specialized accreditation or licensing, such as medicine or architecture, are often difficult for foreign workers to access, even those who have extensive experience in their home country. Degrees earned in a foreign country are less beneficial than those earned in the host country. To overcome these obstacles, policy groups suggest that governments and industry leaders invest in mutual recognition agreements or mentoring groups where established immigrants can help newcomers to better understand the intricacies of the job market in the host country.