High-Skill Immigration: A Resource (Part 1)

Earlier this week in his post on Forbes.com Adam Ozimek challenged bloggers and economists to write more on the subject of high-skill immigration as an economic policy lever. Ozimek is frustrated because this is an issue of extreme importance and urgency on a national scale (we agree), but it doesn’t get blogged about much because it’s really not that controversial. Most people are of the opinion that allowing more highly skilled and highly educated immigrants to stay in the United States is a good thing, but national policies on the matter have yet to change.

To add fuel to the blogging fire and to provide something of practical use for Practically Friday, I present you with a wealth of research on the topic. This is part one of two posts: the first is specifically Kauffman-funded research and resources, the second will be outside research and resources.

The Kauffman Foundation has funded a great deal of research regarding immigrant entrepreneurs since 2007, primarily written by Vivek Wadhwa and company. The latest report, America’s New Immigrant Entrepreneurs: Then and Now, is Part VII in Wadhwa’s Immigration and the American Economy series, which examines “the economic contributions of skilled legal immigrants in the United States, what is different about them, what obstacles they face with the U.S. immigration system and why tens of thousands of skilled immigrants and would-be immigrants are heading back to their home countries and what the implications are for the United States.”

Tom Brokaw highlighted some of Wadhwa et al.’s research for NBC Nightly News in 2011 as a part of its “America at the Crossroads” series, interviewing some of these young foreign entrepreneurs, most of who will be forced to return to their home countries once their temporary visas expire, taking the jobs they created with them.

You can check out the entire research paper series through the links below:

• Part I: America’s New Immigrant Entrepreneurs
• Part II: Education, Entrepreneurship and Immigration
• Part III: Intellectual Property, the Immigration Backlog, and a Reverse Brain-Drain
• Part IV: America’s Loss is the World’s Gain
• Part V: Losing the World’s Best and Brightest
• Part VI: The Grass is Indeed Greener in India and China for Returnee Entrepreneurs
• Part VII: America’s New Immigrant Entrepreneurs: Then and Now

Wadhwa has also written a new book based on this research, The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial Talent, and created a website as a resource for journalists and a voice for immigrant entrepreneurs: ImmigrantExodus.com. The book argues that with increased global competition, current U.S. immigration policies leave foreign-born entrepreneurs no choice but to take their innovations to other countries, as shown by the unprecedented drop in the number of immigrant-founded, high-growth startups (see Part VII). This exodus creates a multi-trillion dollar loss for the United States and an economic gain for countries such as India and China.

Other entrepreneurship and immigration research from the Foundation includes:

• The Kauffman-designed Startup Act, which gave rise to the Startup Act 2.0 (S. 3217 and H.R. 5893), currently being sponsored by Senators Marco Rubio (R-Fla.), Chris Coons (D-Del.), Jerry Moran (R-Kan.), and Mark Warner (D-Va.). The bill includes language to create new visas for immigrant entrepreneurs (Sections 3, 4, and 5).
  
  
  
  
• Reforming Immigration Law to Allow More Foreign Student Entrepreneurs to Launch Job-Creating Ventures in the United States by Anthony Luppino, John Norton, and Malika Simmons outlines specific measures to modify immigration law in the United States to attract and encourage talented international students to start job-creating businesses in the U.S.
  
  
• A chapter in Better Capitalism: Renewing the Entrepreneurial Strength of the American Economy by Robert E. Litan and Carl J. Schramm entitled “Importing Entrepreneurs” discussing immigration policy regarding highly skilled entrepreneurs. “Welcoming and even recruiting skilled immigrants, especially those wanting to launch a business in the United States, can be – and is – both good economics and good politics.”
  
  
• Two Kauffman-funded policy briefs by the National Foundation for American Policy:
  
  • Keeping Talent in America argues that international STEM graduates (science, technology, engineering, or math) from advanced universities should be handed a green card along with their diplomas to encourage them to stay in the United States and start a business.
  • Still Waiting: Green Card Problems Persist for High Skill Immigrants points out that the increased wait times for highly-skilled immigrant entrepreneurs to get green cards (up to 70 years!) is a threat that could “deprive the country of talented individuals who will choose to develop innovations, make their careers and raise their families in other nations” and offers solutions to remedy the backlog.
• A Fordham Urban Law Journal article, “Making the Case for Changing U.S. Policy Regarding Highly Skilled Immigrants,” by John E. Tyler and Peter H. Schuck, that highlights the importance of highly skilled immigrant entrepreneurs to the economy, stating that these entrepreneurs in STEM fields “have disproportionately catalyzed and expanded U.S. innovation, jobs, wealth creation and resulting advances in human welfare.” A version of this article was also a chapter in the Kauffman Foundation book Rules for Growth (chapter 4).
  
  
• Knowledge Economy Immigration: A Priority for U.S. Growth Policy by Robert E. Litan and Tim Kane, states that the “single most important policy reform that will boost long term growth in the United States is to reduce the barriers facing highly skilled and highly educated immigrants. At least 50,000 workers with advanced degrees are sent out of the United States each year, although they have already passed security tests and become part of the productive fabric of the U.S. economy. In a world where the knowledge economy adds more value to national incomes than physical labor, the current U.S. stance of exiling many of the smartest people in the world imposes self-inflicted wounds on our currently troubled economy.” [emphasis mine]
  
  
• The Budgetary Effects of High-Skilled Immigration Reform by Arlene Holen at the Technology Policy Institute. Through a grant from the Kauffman Foundation, Holen examined the fiscal effects of immigrant entrepreneurs and concluded that “legislation considered by Congress during the last few years to loosen green card and H-1B caps could reduce the federal deficit on the order of $100 billion over ten years.” [emphasis mine]
  
  
• America’s Great Job Creators: Immigrant Entrepreneurs – a Kauffman-produced video featuring entrepreneurs from India, Russia, Korea, and other countries about the potential benefits from increasing the number of green cards so that foreign entrepreneurs can start businesses and create jobs in the U.S.
  
  

The major takeaway from all this research is that America loses big – and I mean big –when highly skilled immigrant entrepreneurs return to their native countries if they can’t start a business in the United States. In order to have a vibrant, flourishing economy, create jobs on the scale this country needs, and help reduce the federal deficit, the U.S. needs to recognize the contributions of these skilled immigrants and encourage them to stay and continue to create businesses. In order to do that, our visa system needs to change, and quickly.

And that, as Ozimek points out, is absolutely worth blogging about. As he puts it, “It’s the most important economic issue of our time, far more important than tax reform, and it is a lever that could help improve a lot of problems we have in this country. We should be shouting this from the rooftops daily.”