Since 2008, la crisis has forced thousands of people to leave Spain, in search of work elsewhere. If you ask the official INE, they’ll tell you about 200k have left since 2008; if you ask the think-tank Fundación Alternativas, they’ll put the figure at 800k. In any case, it’s clear: Spain’s abysmal economy has forced both immigrants, as well as educated youths (a “brain drain”) out of the country.
Now, common sense tells us this is a bad thing. After all, such large-scale emigration is a sign of how desperate people are. You only decide to seek work elsewhere, leaving behind your friends and family, as a last resort. Moreover, a “brain drain” hardly bodes well for Spain’s future either. Having educated its workforce, Spain is now unable to reap the benefits of its talent.
Yet, it could be that to leave Spain is making the best of a bad situation for many people. This is because of an economics concept called hysteresis. Hysterisis is the idea that, when a country falls into recession, if you’re unable to find work, your skills will stagnate, meaning you’ll stay unemployed even after the economy gets better. So, recessions push up long-term unemployment rates.
In other words, were unemployed Spaniards to stay in Spain, they’d be putting their long-term prospects into jeopardy, even once Spain’s economy improves. Given this, emigrating is the best option. For Spaniards, it means they can find work elsewhere, and keep their skills up-to-date. For Spain, it means there’ll be fewer people to receive unemployment benefits, in the long run.
Moreover, although the idea of countless educated Spaniards leaving Spain sounds bad, “brain drains” aren’t normally permanent. Instead, our ties to our friends and family endure, meaning emigrants tend to return home eventually. In addition, a “brain drain” can even benefit Spain. This is because, when emigrants return home, they do so with the language and job skills they’ve gained abroad.
In brief then, yes, it would be far, far better if thousands of people didn’t have to leave Spain to find work elsewhere. It would be great if there were in fact jobs available. But, given the fact that there aren’t, we shouldn’t look at large-scale emigration as necessarily a bad thing. Instead, it means Spaniards keep their skills updated, while potentially benefiting Spain’s economy in the future.
A guest post by Peter Lavelle at currency broker Pure FX