Why immigrants are vital to the future of American entrepreneurship

You've surely heard this familiar refrain in the immigration reform debate: Newcomers to the country take jobs away from hardworking U.S. citizens. The reality, however, isn't nearly that straightforward. And particularly when it comes to America's small business sector, immigrants actually do our economy a huge service.

Immigrants form and run small businesses at higher rates than the general population, according to data the U.S. Small Business Administration gathered in the 2007 Survey of Small Business Owners. One out of 10 immigrant workers owns a business. Immigrants also tend to start their own businesses with more capital. They're more likely to hire employees, though they hire fewer, on average, than their U.S.-born counterparts.

And yet, Uncle Sam makes it exceedingly hard for entrepreneurial immigrants to set up shop in the U.S.

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

The first battle many immigrants face is the ability to get to or stay in the country legally. There's no dedicated visa option for entrepreneurs.

To lawmakers' credit, a startup visa specifically meant for immigrants who aim to start businesses in the U.S. has long been proposed. But it has yet to become a reality.

Different versions of the StartUp Act have been introduced in Congress since 2010, but, like most legislation, never made it out of committee. The bill sponsored in the House in 2014 by a Democrat and a Republican proposes an amendment to immigration law that would grant conditional, employment-based visas to immigrants who can secure a certain amount of capital for their businesses and commit to meeting employment and revenue benchmarks. A 2015 Startup Act bill introduced in the Senate took a different tack, focusing on granting or extending entry to immigrants with advanced STEM degrees.

Unsurprisingly, the support for opening doors to immigrants extends to Silicon Valley. Facebook founder Mark Zuckerberg is very outspoken about the value immigrants add to our economy and workforce:

The concept of a startup visa isn't unheard of. Many countries already offer similar programs. Chile recruits entrepreneurs from all over the world to spend six months developing their businesses with access to Chilean government resources and Santiago's thriving startup community. Denmark gives aspiring entrepreneurs two-year visas, with a possible three-year extension. For years, Australia has had a clear pathway to visas for entrepreneurs.

The upshot seems clear: If aspiring business owners with solid business plans can't move to the U.S., it's a safe bet other countries will welcome their ideas, talent, and capital.

But even if an entrepreneurial immigrant gets to the U.S. legally, there are other hurdles. For one thing, they have to worry about access to resources commonly afforded U.S. citizens. Yes, immigrants tend to start businesses with more capital than U.S. citizens, but that doesn't tell the whole story. There's not much solid national data available about the access immigrants specifically have to funding, but it's thought they most often rely on personal wealth, according to a 2012 report commissioned by the SBA. And it has been proven more concretely that groups many immigrants belong to, like women and people of color, have decreased access to traditional funding sources compared to white men, which in turn lowers the success rate of their businesses.

There's always more we can do to stimulate small business growth. And in finding ways to grow, it's foolish to write off immigrants, a sizable portion of our nation's small business owners. Ensuring they have the support they need to get their ventures off the ground is an important part of ensuring the country's diverse small business scene thrives.