As capital flees from Greece at a record pace, it’s worth remembering that the best minds have already jumped ship.
Human capital flight is what economists call this migration of talent to greener pastures. Greece is hemorrhaging its creme de la creme.
Brain drain — a term coined by the British Royal Society in the 1960s to describe hordes of scientists moving to North America — takes a heavy toll on an economy. Losing its best workers, a country collects less tax revenue — skilled professionals earn more, therefore contribute more — and misses out on potential entrepreneurs. Not to mention draining the country of its confidence.
Compare the scale of people leaving the country before and after the crisis, and one can see how the Greeks now can’t get out fast enough. Between 2009 and 2014, the number of qualified home-grown professionals seeking permanent work overseas was 20,281, according to Eurostat figures. Now look at an earlier period of relative prosperity in the early 2000s. A mere 2,552 tried to leave.
(Don’t be deceived by German figures being higher than Greece’s. Germany has almost eight times the population of Greece and as the first chart shows, for as many talented people leaving Deutschland, there are just as many coming in.)
With a default on the horizon — the decision to defer a payment to the International Monetary Fund does not inspire confidence — Greece can’t afford to lose more smart people.
But who can blame the country’s hottest young talent for wanting to take off when confronted with youth unemployment that is higher than even a failed state like Libya?