Entrepreneurship
Entrepreneurship and business creation is fundamental to a healthy economy. Companies less than five years old create an average of 1.5 million new jobs for Americans each year.† Immigrants in particular play an important role in creating jobs as they are more likely to start a new business than the rest of the population. Despite this, the United States lacks a startup visa to welcome immigrant entrepreneurs with a proven idea and solid investment. This results in many business owners struggling to stay—at a cost to our economy and its workers. † Jason Wiens and Chris Jackson, “The Importance of Young Firms for Economic Growth,” September 13, 2015. Available online.
Immigration reform: recognize contributions by making the system work
St. Patrick’s Day is not simply a holiday to celebrate Irish heritage; it’s also a celebration of the immigration of many Irishmen and women to the shores of our country. From America’s founding, immigrants from a vast array of countries have been a central cornerstone of our nation’s incredible economic… Read More
Mayors Agree, Immigrants Make Their Cities More Economically Competitive
“Mayors are looking for a fix,” said Mayor Scott Smith of Mesa Arizona, President of the U.S. Conference of Mayors. “The status quo is not acceptable. It's as simple as that.” In a January 31 letter to Members of Congress, the United States Conference of Mayors urged expeditious action on immigration reform in 2014. As the letter stated: “Fixing our nation’s broken immigration laws is among the most important issues of interest to America’s mayors currently before the U.S. House of Representatives. We believe strongly that maintaining the status quo will further damage the economic, political and social structure of our cities and our country. As Mayors, we have a ground-level understanding of the pressing economic and moral imperatives that necessitate changing our national immigration system, and we urge the House to expeditiously bring legislation to the floor.” Read More
Report: Three-Quarters of Republican Business Leaders Back Immigration Reform
Whether as high-tech contributors within a large company or as the founders of their own businesses, immigrants play a critical role in entrepreneurship and innovation. Take the selection of Satya Nadella, an immigrant from India, as Microsoft’s new CEO. He originally came to the U.S. as… Read More
Senator Jeff Sessions Has Erroneously Blamed Immigrants for U.S. Income Inequality
Despite the formal end of the recession in 2009, unemployment in the United States remains high, wages are still stagnant, and economic indices of all kinds are looking grim. A crisis of this magnitude requires bold action by U.S. lawmakers to realign U.S. economic policies in ways that promote the growth of both jobs and wages. Economists across the political spectrum agree that immigration reform—including a pathway to legal status for unauthorized immigrants already living here—should be a central part of any such effort to boost the economy. Nevertheless, Sen. Jeff Sessions (R-AL) thinks he knows better. In his opinion, what we need to do to alleviate the nation’s economic woes is to derail immigration reform. Apparently, if we can hang on to our broken immigration system a little longer, there will be brighter days ahead for the U.S. economy. Read More
Michigan to Immigrants: You’re Welcome Here
It is clear that Michigan Gov. Rick Snyder understands that immigration can be a potent boost to his state’s economy. It’s also an important component of economic revitalization for a city such as Detroit. Improving the nation’s broken immigration system could have enormous economic benefits for Michigan and states across the country, so Snyder joined former New York City Mayor Michael Bloomberg and former Secretary of Commerce Carlos Gutierrez, in Washington Friday to continue urging lawmakers to overhaul the U.S. immigration system. As Gutierrez explained, “Our laws aren’t serving our economy.” And Bloomberg noted that it is terrible economic policy to turn away foreign born entrepreneurs and innovators while also making it difficult for foreign-born graduates to remain in the country after earning degrees from our colleges and universities. State leaders recognize this as well, but they also know upgrading immigration laws requires congressional action. “We need comprehensive immigration reform. Bottom line,” Snyder said Friday. “To be blunt, we have a dumb system.” Read More
Immigrant Entrepreneurs Driving Growth in America’s Heartland
When Jordi Carbonell, originally from Spain, and his wife Melissa Fernandez opened their Cafe Con Leche coffee shop several years ago in southwest Detroit, the couple founded their business on the idea that the neighborhood needed a central gathering place to create a strong community. Today,… Read More
Immigrant Entrepreneurs are Investors in their Communities
Cedric Francois, a medical researcher from Belgium, came to Louisville, Kentucky, after hearing that researchers there were beginning work on the first hand transplant. Later, he co-founded two pharmaceutical companies. Suhas Kulkarni, an immigrant entrepreneur himself who founded Louisville-based IT firm Omnisys, understands the need for integrating and helping immigrant entrepreneurs get their start and is leading the area’s new Refugees and Immigrants Succeeding in Entrepreneurship (RISE) initiative. This is a collaborative effort among public and private organizations to support immigrants and refugees in the entrepreneurial endeavors in the Louisville area. RISE recognizes that Louisville “has an untapped pool of talent for city-wide economic development in the form of immigrants and refugees” and that “this population has the potential of becoming drivers of economic growth” for the region. Immigrant entrepreneurs are often vital assets in communities. They start businesses, create jobs, and encourage community revitalization efforts. Immigrant businesses can help revive dilapidated or aging retail corridors. And they provide an opportunity for immigrants to reinvest in the area. Take for example Vilmar Zenzen, originally from Brazil, who is opening a new upscale Brazilian steakhouse in downtown Louisville. Zenzen already operates another Brazilian steakhouse in Knoxville, Tennessee. Read More
Licensing Barriers Leave Immigrant Doctors Driving Cabs Instead of Practicing Medicine
Instead of putting foreign medical and other advanced degrees to use in the United States, it is common among immigrant doctors and other professionals to work less skilled jobs, such as a taxi driver or waiter, because the complicated licensing process keeps them from applying their training in the U.S. market. According to a recent Migration Policy Institute (MPI) series of reports on improving credential recognition, the United States is experiencing a “brain waste” by preventing immigrants living in the country from efficiently transferring their foreign credentials. MPI’s most recent report concludes their series by exploring prospects for international recognition of foreign qualifications. Read More
How Immigrants on a Pathway to Citizenship can Revitalize Rust Belt Cities
Like Rust Belt cities such as Baltimore and Detroit, rural towns across America have experienced population declines in recent decades. Some places, however, are an exception to that trend thanks in part to the arrival of immigrants. For example, while other Iowa towns experienced population decline over the past several decades, West Liberty’s population grew because of immigration. As Steve Hanson, superintendent of West Liberty Community School District, notes, “in the last 20-30 years we would have had a population decline if we hadn’t had immigrants come in [for] jobs in the food manufacturing business. They provide a source of labor that wouldn’t have been there.” And West Liberty’s Mayor, Chad Thomas, said immigration has “kept a lot of storefronts and businesses open that probably otherwise would have closed.” Read More
How Would Immigration Reform Help the U.S. Economy?
A growing consensus has emerged among both liberals and conservatives that immigration reform would serve as a stimulus to the U.S. economy. Reform would not only raise the wages—and therefore the tax payments and consumer purchasing power—of newly legalized immigrants, but would ensure future flows of immigrant workers, taxpayers, and consumers that are sufficient to meet the labor-force needs of our rapidly aging society. Conversely, trying to enforce our way out of a dysfunctional immigration system only wastes taxpayer dollars while exacting a high toll in both human lives and missed economic opportunities. Read More
Immigrants Create American Jobs
How many jobs do immigrant entrepreneurs create? The data shows that firms owned by immigrants provide millions of jobs for U.S. workers and generate billions of dollars in annual income. With new business formation slowing in the United States, immigrant entrepreneurs have a critical role in many parts of the country, creating jobs for all Americans.
What percent of businesses are owned by immigrants?
The act of moving to another country is inherently courageous and risky. So, it comes as no surprise that immigrants tend to be more entrepreneurial than the rest of the population. In 2019, immigrant entrepreneurs made up 21.7 percent of all business owners in the United States, despite making up just over 13.6 percent of the population and 17.1 percent of the U.S. labor force.
Where Immigrants Are Most Entrepreneurial, 2019
Immigrants and the Recovery from the Great Recession
Foreign-born entrepreneurs and the jobs they created were instrumental in the recovery from the Great Recession. Between 2007 and 2011, immigrant entrepreneurs founded a large share of new businesses across the country and in several key states.
Share of New Businesses Founded by Immigrants in Select States, 2007-2011
Which Industries Are Immigrant Businesses Most Prevalent?
As important as the frequency with which immigrants start businesses is the diversity of fields in which they start them. Immigrants start more than 25 percent of all businesses in seven of the eight sectors that the U.S. Bureau of Labor Statistics expects to grow the fastest over the next decade. They also play a large role in founding both Main Street businesses1 and high-tech firms.2
Sources:
1 David Dyssegaard Kallick, “Bringing Vitality to Main Street: How Immigrant Small Businesses Help Local Economies Grow,” New York: Fiscal Policy Institute and Americas Society/Council of the Americas, 2015. Available online.
2 Vivek Wadhwa et al., “America’s New Immigrant Entrepreneurs: Part I,” SSRN Scholarly Paper (Rochester, NY: Social Science Research Network, 2007). Available online.
Share of Businesses Started by Immigrant Entrepreneurs in Seven Key Sectors, 2007-2011
Immigrants Found both Main Street Businesses and High-Tech Firms
Business Ownership Among Immigrant Groups
Looking at specific ethnic and national origin groups within the immigrant population, we find that many exhibit entrepreneurship rates higher than the native-born. At right we highlight the particular contributions of Middle Eastern business owners in Detroit, a group frequently credited with helping to spur the city’s recent economic comeback.
Sources:
3 Steve Tobocman, “Guide to Immigrant Economic Development,” Welcoming America, accessed July 5, 2016. Available online.
4 New American Economy, "Reason for Reform: Entrepreneurship," October 2016. Available online.
Entrepreneurship Rates for Immigrant Subgroups, 2014
Immigrants and the Fortune 500
Consistent with past NAE research, a significant number of firms on the most recent Fortune 500 list were founded by immigrants or their children. These companies make enormous contributions to both the U.S. and global economy. They also live on beyond their founders, generating jobs and revenue long after their visionaries retire or move on.
Visa Obstacles
Currently, there is no visa for those who want to come to the United States, start a company, and create jobs for U.S. workers. To access a visa, many immigrant entrepreneurs choose to sell a majority stake in their company and then apply for a visa as a high-skilled worker rather than as the owner of the firm. Our broken H-1B visa system, however, means that many entrepreneurs cannot get a visa before the cap is exhausted each year. In 2016, the White House proposed a rule that would make it easier for entrepreneurs to remain in the country, but it is clear a more permanent, legislative fix is needed.5
Sources:
5 Issie Lapowski, “White House Proposes a New Immigration Rule for Entrepreneurs,” WIRED, accessed December 14, 2016. Available online.
6“USCIS Completes the H-1B Cap Random Selection Process for FY 2016,” USCIS, accessed December 14, 2016. Available online.
Low-Skilled Entrepreneurship
Immigrant entrepreneurs are hardly a monolithic group. While much of the attention is focused on high-skilled foreign-born entrepreneurs that drive innovation in Silicon Valley, immigrant entrepreneurs with humbler backgrounds continue to play critical roles in the U.S. economy. Founding retail shops, restaurants, and personal service businesses, these immigrant entrepreneurs help towns and cities across the United States stay vibrant. In sum, the over 2.1 million immigrant entrepreneurs with less than a college degree have a significant economic impact, creating billions of dollars in economic activity and providing jobs to thousands of Americans.
Top Industries Among Immigrant Entrepreneurs with Less than a Bachelor’s Degree, 2015
Entrepreneurship Rates of Workers in Various Demographic Groups, 2015
Business Income of Less-Skilled Immigrant Entrepreneurs, 2015
All gifts are matched dollar for dollar
No one should face the immigration system alone
