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 can let N.Y. benefit from world’s skills
Cornell University President David J. Skorton, Press Connects A growing number of Americans are coming around to an idea that the tech industry and other business groups have been promoting for quite a while: To fuel economic growth, especially in the tech sector, we need to make it easier for… Read More
Forging Consensus on Visa Program Critical to Crafting Effective Policy
A proposal being considered in the House revives the debate around the number of visas that would be allocated to less skilled workers, also known as “W” visas. In particular, Representatives Ted Poe of Texas and Raul Labrador of Idaho are working on an immigration bill that could double the number of visas of less skilled workers that the Senate settled on. Although the increased number could help address the labor shortage in some industries, this proposal would potentially cause a fracture in the consensus achieved between business and labor leaders who negotiated the levels that were included in S. 744. Ultimately, what is critical to success of a program depends on having the right players at the table ensuring both private and public interests are protected. Read More
Paul Ryan: Immigrants ‘Bring Labor to Our Economy So Jobs Can Get Done’
Nancy Cook, The National Journal July 25, 2013 In the past month, Rep. Paul Ryan, normally so focused on fiscal matters, has shifted his attention to immigration. He isn’t pitching reform as a humanitarian or budget-cutting move, though other advocates say it would be both. Instead, the House Budget Committee… Read More
How States And Local Economies Benefit From Immigrants
Detroit usurped Jefferson County, Alabama’s place last week as the largest municipality in the United States ever to file for bankruptcy. And as signs increasingly pointed toward the city’s financial issues, local leaders in Southeast Michigan have been exploring ways in which to stabilize or strengthen Detroit’s economy. One way to do that is to encourage more immigrants to settle there. New restaurants, shops, and residents already have helped to revitalize one area in Southwest Detroit called Mexicantown. And there is no doubt that immigrant entrepreneurs and innovators play an important role throughout Michigan as well. Immigrant entrepreneurs create jobs, bring in additional revenue, and contribute significantly to the state’s economy. Highly skilled immigrants are vital to the state’s innovation activities, spurring further growth. As such, local leaders and advocates recognize the importance of immigrants in their communities and support immigration through local “welcoming” and integration initiatives. Read More
Immigration Reform an Imperative for Cities and Metropolitan Areas
Metropolitan leaders from around the country made the case for immigration reform at an event hosted by the Brookings Institution’s Metropolitan Policy Program today. Over 80 percent of the U.S. population, including 95 percent of immigrants, now live in metropolitan areas; cities and towns across the country therefore have a huge stake in passing immigration reform. In fact, panelists agreed that comprehensive immigration reform is an imperative for metropolitan areas. “We need an immigration system that is keeping with the times,” stated Audrey Singer, a Senior Fellow with Brookings. Read More
Immigration Reform Fattens State Economies, Too
“Should the United States be pro-immigrant?” asked Tax Watchdog Grover Norquist. “That’s like asking whether McDonald’s should make hamburgers. It’s made the United States work for several hundred years. It’s what’s made us different, what’s made us more successful,” said Norquist during a recent call summarizing a new report from Regional Economic Models, Inc. (REMI) on the economics of immigration reform. Read More
Supreme Court’s DOMA Decision Good for Economic Competitiveness
In the global economy of the twenty-first century, a globally mobile workforce is critical to remaining competitive. Yet for LGBT employees, their families, and their employers, significant barriers remain in place. The Supreme Court’s June 26 decision in United States v. Windsor finding part of the Defense of Marriage Act (DOMA) unconstitutional has clear and direct benefits for married same-sex couples, including bi-national couples. But beyond the benefits to married couples themselves, the Court’s decision is also a win for economic competitiveness. Specifically, the DOMA ruling makes U.S. businesses more globally competitive because they now can attract and retain foreign-born employees who want to stay in the United States with their same-sex spouses. Read More
Local Welcoming Initiatives Help Build a Nation of Neighbors
While attention has been focused on federal immigration efforts these last few months, states and cities continue to encourage and promote immigration as well. From well-established programs like Welcoming America and its many state-level affiliates, Cities of Migration, the Building Resilient Regions research group, and the Center for the Study of Immigrant Integration, to new programs like the Welcoming Cities and Counties initiative, the impetus to invite immigrants into our communities continues to grow. Read More
Immigrants are Key Driver of U.S. Talent and Economic Competitiveness
U.S. workers in science, technology, engineering, and mathematics (STEM) fields have been important contributors to American innovation, job creation, rising incomes, and global economic competitiveness throughout the years. And not surprisingly, immigrants have played a critical role in American innovation through STEM fields and all parts of the U.S. economy. A new report by Gordon Hanson (University of California, San Diego) and Matthew Slaughter (Dartmouth) describes these important relationships between talent, economic competitiveness, and immigration in the United States. In their paper, the authors present data in support of three critical points: Read More
Immigrants Boost Economic Vitality through the Housing Market
Abundant research shows that immigration is a net benefit to the United States’ economy. It leads to higher wages, business formation, job creation, and greater innovation – nationally and locally. Foreign workers who immigrate to the U.S. help alleviate labor force gaps left by a workforce increasingly nearing and entering retirement age. Furthermore, immigrants help fulfill growing healthcare needs of an aging population. In addition to these positive benefits of immigration, the favorable effect immigrant home-buyers have on the housing market is another important economic impact. Indeed, new research from the Americas Society/Council of the Americas and the Partnership for a New American Economy describes how the 40 million immigrants residing in the United States added $3.7 trillion to housing wealth in the U.S. The research, prepared by Jacob Vigdor at Duke University, uses county-level data on population and housing from the U.S. Census Bureau and American Community Survey from 1970 to 2010. The results show that immigration led to a boost in home values, particularly in neighborhoods hit hardest by the U.S. housing bust. 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
