With all eyes focused on the crisis, we forget that the key axis of economic competitiveness remains the global competition for talent. In my 2005 book, I argued the greatest threat to U.S. long-run competitiveness was the twin pincers – on the one side, increased ability of the emerging economies – particularly India and China – to retain or re-attract their top talent and on the other side by growing efforts among a slew of advanced countries to compete more aggressively for global talent.
What I did not or could not know is how the crisis would accentuate and accelerate these forces. The Financial Times provides this report on how the crisis appears to be accelerating the flow of expat talent from the U.S. Here’s another from the Globe and Mail:
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.
The places that are best able to retain and attract talent during and coming out of the crisis will gain significant long term advantage.
Question: Is the crisis altering the global playing field for competing for talent and, if so, how?
December 12th, 2008 at 12:06 pm
From what I’m seeing, the financial crisis is creating two new circumstances that are affecting the flow of talent.
First, the economic slow down has resulted in many people feeling less tied to their current employer — in several ways.
A) As I wrote in my last blog entry, in these times there are fewer and smaller bonuses, which often serve to tie talented people to their jobs.
B) people are nervous about losing their jobs through no fault of their own, so they are updating their resumes and networking more.
C) some companies are being forced to layoff talent (and not just those individuals who aren’t really a fit anyway)
Second, “Cash is king.” Those organizations with the cash or the AAA credit rating will be better able to keep their talent (if they communicate a secure message) and go on a talent hunting spree for everyone affected by the issues mentioned above.
A sub-set of the “cash is king” feature is that some talented — and wise — individuals didn’t spend all of the money they earned in the last few years, giving them the personal capital to start their own company (perhaps through moving [back] to India or China to do so as described in the Globe and Mail article).