Expatriate Nation: after offshoring, a brain drain?

Offshoring — the export of jobs overseas– has become a fixture on the global business landscape. And though offshoring’s impact has been less than pessimists feared, anxieties over offshoring have obscured the fact that offshoring is but the vanguard of a host of labor surprises to come. One such surprise is just beginning to be felt: an exodus of top flight US research scientists and entrepreneurs for opportunities abroad. The exodus is still a small trickle, but there is good reason that today’s trickle will grow.

The most visible departures have been in the sciences, especially in bioscience research. Shortly after the Bush stem cell ban, top UCSF stem cell researcher Roger Pedersen moved to Cambridge University in part because of British policy friendly to stem cell work. In the same period, Edison Liu (a San Franciso native) resigned as Deputy Director at the US National Cancer Institute and moved to Singapore where he heads up Singapore’s Genomics Institute. Most recently, Singapore has recruited prominent US cancer researchers, Neal Copeland and Nancy Jenkins to join the Singapore Institute of Molecular and Cell Biology.

But the departures of prominent scientists is only part of the story; there is a quiet trickle of entrepreneurs and skilled executives abroad as well. Many are expats returning to their home countries — Indian entrepreneurs going back to India or Taiwanese execs taking up offers in mainland China — but there are also others with no obvious ties to the target country moving abroad as well. Shanghai has a growing population of ethnically non-Chinese Americans who moved there solely because of the business opportunities. One power couple I know told me that they moved there specifically to give their young (Anglo) children an edge up on the future by allowing them to learn the language and the culture in “the century’s next super-power.”

It is tempting to dismiss the expat trickle on the specifics. Take Singapore — it is a small place and can absorb only so many foreigners. Moreover, research expats in Singapore arrive knowing of Singapore’s informal policy of encouraging foreigners to stay only for 3 – 7 years and then move on elsewhere. Arguably, India is merely reabsorbing its own diaspora, and China’s appeal for foreign managers will cool as it grows its own generation of business leaders.

But for each of these excuses there are other indicators that there is much more to today’s expat trend. Indian outsourcing firms are hiring Americans with no prior ties to India, some who are chasing their outsourced jobs around the globe. And one can’t walk through the labs of an Asian electronics company without seeing a cadre of Americans working alongside colleagues from all over the world. This is clearly the leading edge of a trend that will grow in the next few decades.

Alarmists will warn us that this is bad news for the US, but I disagree. If the US is going to compete in a globalized world, it must have a seasoned expat business class that is comfortable working anywhere on the planet. Many who go abroad may never return, but more will keep going to wherever the opportunities are. As they wander across the planet, they will only become more valuable, and their children will gain knowledge and experience that will make them more valuable yet. Then we can only hope that amidst the global competition for talent a combination of domestic opportunity and nostalgia may be enough to lure the best and brightest back home one day.