How Much Would a Startup Visa Help the Economy?
After a winter of depressing economic data, strong growth in the second quarter recently gave Americans some room for optimism. But when it comes to the health of our economy, most of us are still pretty gloomy. Gallup polling shows that more than half of Americans still feel the economic outlook is getting worse.
Clearly, as a populace we're ready for any idea that might improve the overall economic picture, and the folks at the Kauffmann Foundation think they have one: Getting members of Congress to get off their butts and pass a startup visa to help bring more immigrant entrepreneurs into the country.
Given that our esteemed lawmakers can't seem to agree on anything these days, the entrepreneurship organization is a long way from being able to guarantee that such a measure will ever pass, but on the Hill's Congressional Blog recently, Kauffman's policy director Jason Wiens and Dane Stangler, the organization's vice president of research and policy, did make a strong case regarding why it should.
Forget common sense or humanitarian considerations, getting more entrepreneurial foreigners into America and starting businesses is all about the money, they write.
An open-and-shut case
"A Kauffman Foundation analysis of one proposal in Congress to enact a startup visa found that it could create up to 1.6 million new jobs for Americans over 10 years and add an additional 1.5 percent to economic growth. This estimate, derived from historical data on employer firm creation and survival, plus Census Bureau statistics on job creation, is considered conservative," Wiens and Stangler write.
This comes on top of previous studies that have shown the outsized importance of immigrant entrepreneurs on the economy. A report from the nonpartisan Fiscal Policy Institute's Immigration Research Center, for instance, looked at data from the Survey of Business Owners and the American Community Survey and determined that though immigrants make up 13 percent of the U.S. population in general, they make up 18 percent of small business owners, and that immigrant-owned businesses account for 14 percent of private sector employment. These immigrant-owned companies generated $665 billion in receipts in 2007, the last year for which data is available.
These cold, hard numbers are pretty convincing, but if you're looking for more human reasons to go along with the startup visa plan, there's no shortage of stories of promising entrepreneurs desperate to create American jobs but held up by their immigration woes.
Don't get your hopes up
The idea certainly has had prominent backers in the entrepreneurial community for years, and, at least on paper, seems popular on both sides of the aisle in congress. But as ever with our legislators, politics seems to be trumping sound decision making, and this less-controversial idea is thoroughly tied up with more contentious questions around immigration reform and general partisan bickering.
So will the idea of a startup visa finally become a reality anytime soon? Despite these new numbers, don't get your hopes up. Even the biggest backers of immigration reform for foreign-born entrepreneurs are bummed about the idea's prospects. As other countries move ahead with similar legislation, entrepreneurial talent may choose to go elsewhere. "Someday there's going to be a headline: 'U.S.-born, American startup founder finds the Chilean dream'. That's gonna make me so sad," Reddit co-founder Alexis Ohanian told the Washington Post.