A new non-partisan study on entrepreneurship shows that immigrants started more than half of current US-based startups valued at $1 billion or more, lending credibility to the claim that immigration benefits the US economy. The study, from the National Foundation for American Policy, a non-partisan think tank based in Virginia, shows that immigrants play a “key role in creating new, fast-growing companies.” Immigrants, the study shows, have started more than half (forty-four of eighty-seven) of America’s startup companies valued at $1 billion dollars or more; moreover, immigrants are key members of management or product development teams in over seventy percent of these companies. Using public data and information from the companies, the study found that among the billion dollar startup companies, immigrant founders have created an average of approximately 760 jobs per company in the US, and the collective value of the forty-four immigrant-founded companies is $168 billion, close to half the value of the stock markets of Russia or Mexico.
India was the leading country of origin for the immigrant founders of billion dollar companies with fourteen, followed by Canada and the United Kingdom with eight each, Israel with seven, Germany with four, China with three, France with two, Ireland with two, and twelve other countries with one. The three highest valued US companies with immigrant founders include car-hailing service Uber Technologies, data-software company Palantir Technologies, and rocket maker Space Exploration Technologies.
Stuart Anderson, the author of the study and the foundation’s executive director, says the findings show that the US economy could benefit even more from foreign-born entrepreneurs if it were easier for them to obtain visas, since currently it can be difficult for foreign-born entrepreneurs to grow their companies because of the many difficulties and delays in obtaining work visas and Green Cards. The study argues that a “startup visa” to enable foreign nationals who start companies and create jobs would be an important addition to the US immigration system. “Who is going to invest in a company if the founder of the company may not be able to stay in the U.S.?” Anderson said in the Wall Street Journal. Many start-ups also face problems hiring new personnel because of the low quota of H-1B temporary visas, which have been decided by random lottery in recent years and is thus not a reliable category for skilled workers.
Additionally, the study argues that new immigration restrictions would likely prevent many future cutting-edge companies from being established in the United States:
Based on an examination of the biographies of company founders, if S. 2394, a bill by Senators Ted Cruz (R-TX) and Jeff Sessions (R-AL), had been in effect over the past decade, few if any of the billion dollar startup companies with an immigrant founder would have been started in the United States. That measure would impose a variety of hurdles before any foreign national could be employed by a U.S. company on an H-1B visa (typically the only practical way for a high-skilled foreign national to work in America), including, in most cases, working at least 10 years abroad before obtaining a visa in America.
While tech leaders including Mark Zuckerberg and Bill Gates have called for increasing the number of H-1B visas for skilled foreign workers, critics argue that many industries that want more H-1B visas are simply looking for cheaper foreign labor. Mother Jones examined companies who allegedly used the H-1B program to ultimately outsource jobs from US workers, and a recent lawsuit charged that Disney colluded to replace US workers with H-1B foreign workers. The EB-JOBS Act of 2015, introduced last July as one solution for entrepreneurs, proposed to provide a two-year Green Card that would be revoked if certain financial and job-creation requirements are not met, has not proceeded because of the standstill in immigration reform.