Skip to main content

Lisbon, the Bangalore of Europe

The call center boom in Lisbon, Portugal, provides another example of how brain drain promotes economic development.
  • Author:
  • Updated:
Sunset over Lisbon, Portugal. (Photo: Francisco Antunes/Flickr)

Sunset over Lisbon, Portugal. (Photo: Francisco Antunes/Flickr)

As economist Enrico Moretti laments, Europeans aren't as geographically mobile as Americans. That's not the case everywhere within the European Union. While Portugal struggles with unemployment, its capital of Lisbon thrives as an epicenter of call center services. Lisbon's secret is Portuguese brain drain:

Cardoso thinks mass emigration of Portuguese in the past century played a key role in Lisbon's current transformation into a global IT and call center hub.

"Portugal has a lot of talent because we're a country of migrants," Cardoso said. "In the 1960s, we experienced huge waves of people emigrating to Germany and France. But a large number of people have returned. As a result, we have a lot of people who speak German and French at a native level."

Typically, migration is a negative economic indicator. People left 1960s Portugal because the economy was better in France and Germany. The quest for opportunity netted migrants new skills, namely language proficiency in German and French. These new skills are a positive economic indicator. Don't despair about the contradiction. People develop, not places. Brain drain is economic development.

Like Ireland, Lisbon has forged a kind of urban nationalism based on the culture of out-migration, "Lisbon has its saudade: a feeling of aimless loss tied to the city’s legacy of vanishing seafarers, explorers shipwrecked in search of Western horizons." The term "saudade" has a reputation as difficult to define. I understand it as a longing for home, a strong tug that would bring back the talented.

I've returned home more times than I care to admit. It feels like a reunion with an estranged lover. You are complete. You are insecure. You are restless. You can't possibly separate again. The relationship is irrevocably broken. Welcome to the purgatory of transnationalism. Nonetheless, the migrant links two places.

Communities obsessed with demographic decline (all communities are obsessed with demographic decline) must learn how to let go of their prodigal daughters and sons. Michelle Madden, addressing attendees at the Economic Developers Council of Ontario annual conference, offers this advice:

She said research shows those who return to their hometown after being educated or getting work experience elsewhere own a higher percentage of businesses and employ more people than those who stayed. Those who work for others achieved higher levels of success, too.

"So embrace youth out-migration," said Madden. "If you bring ex-pats home, it will be good for your community."

She highlighted efforts by Chatham-Kent and Toronto to bring young ex-pats home that included directly linking them with employers, and videos highlighting the stories of those who returned.

Indeed, embrace youth out-migration. Or do not. It will happen regardless, whether or not you follow the Creative Class playbook. What will distinguish one exodus from the other is how residents deal with those who do return.