Postcards from Europe's Financial Bust

Dublin, Ireland
Inside a black-and-white half-timbered building in central Dublin late last month, some 9,000 people — from plumbers to bankers — gathered with a common purpose: finding a new job. Almost all "were skilled, professional people," says Stephen McLarnon, who runs the firm that put on the event, and they were "looking to make a committed move." And a long-distance one. At the Down Under Expo, a forum for recruitment agencies and immigration officials, the prize for job hunters was a new start, not in Ireland, but in Australia or New Zealand.

Irish emigration is nothing new, of course. From the millions who fled poverty and famine over the last century and a half to the many thousands who have regularly quit the country in search of work right up to the end of the 1980s, Ireland's best and brightest have a long history of leaving in search of opportunity and sunnier climates. But a decade and a half of 
 red-hot growth all but wiped out large-scale emigration, and Ireland has instead found itself a destination for immigrants from Africa, Asia and Eastern Europe.

Until now. In recent weeks, Ireland became the first country in the euro zone officially to stumble into recession. House prices — after rising almost threefold in 
 the decade to 2007 — have slumped 10% in the past year, weakening Ireland's construction industry, which plays an outsized role in the country's economy. Throw in frozen credit markets, high inflation, soaring unemployment and a new tax to pay for the financial crisis bailout, and it's little wonder Ireland's workers are again pondering a move abroad. Dublin's Economic and Social Research Institute, a think tank, forecasts a net migratory outflow of 30,000 in 2009, the highest rate for 20 years. The stalled economy, McLarnon says, has "created a sense of urgency."

Recent immigrants to Ireland are among those wondering whether it's time to leave. Some 150,000 Poles came to Ireland in the two years after Poland joined the E.U. in 2004, for instance, but thousands are now heading home. At a recruitment fair in Dublin a few days ago, a panicked former economics student from the west of Ireland wondered if it might be time for her to leave the country, too. Unable to land a financial-services job in Ireland since graduating in May, this 24-year-old woman is now considering a move to England. "I haven't given up yet," she says, but "all options are open." Inside the cavernous hall hosting the fair, recruiters — from big banks to software makers — offer candy to graduates willing to chat. Getting them to stay in Ireland may soon require a little more persuasion. — by Adam Smith

Eisenach, Germany
Great historic forces once spread from Eisenach, where Martin Luther translated the New Testament into German to drive the Reformation. Today, this town of 40,000 is notable for the more prosaic fact that it's at the receiving end of a chilling secular influence: slowing demand for automobiles. Opel, a European subsidiary of the beleaguered American giant General Motors, is the town's biggest employer — and when Opel's in trouble, so is Eisenach.

Until June, the local Opel plant was enjoying a record year as Germany's economy hummed healthily along. In April, the company turned up the speed on its assembly lines to churn out even more cars. Instead of shutting as usual for three weeks during the summer, Opel closed the plant for just two and hired temps to supplement its full-time workforce of 1,800.

Now that boom has come to a halt. On Oct. 13 Opel suspended production at Eisenach for three weeks to help sell off a stockpile of excess cars, hundreds of which crowd a parking lot inside the factory complex. Opel electrician Katrin Huber, 29, isn't happy about this vacation. "The plant shutdown is going to cost me more than $400," she says. "But worse is that we just don't know what the future holds. I'm afraid that the plant could close."

Opel was one of the first Western firms to move east to Eisenach after the Berlin Wall fell in 1989, and it pulled an army of suppliers and service companies in its wake. On Adam Opel Street, Lear Corporation makes seats for the Corsa, while parts makers Mitec AG and Robert Bosch are across town. Uwe Laubach, head of the local chapter of the IG Metall union, says as many as 900 temporary workers in the local auto industry have lost their jobs in recent weeks. "The situation is dramatic," says Michael Lison, head of the industry association Automotive Thüringen.

The uncertainty that Huber and other autoworkers feel is spreading. While an organ grinder plays German folk songs in the street outside, Lilian Arndt, 51, is tying up a bouquet in her tiny flower shop. She has never seen Wall Street, but she is feeling the fallout from the global crisis that began in the U.S. "The situation is frightening and we just don't know how bad it will get," she says. "People order smaller bouquets. The hotels still order arrangements. And there are funerals, of course. But for many people, flowers have become a luxury." Eisenach faces the unsettling prospect that new cars are now a luxury, too. — by William Boston