Washington’s Willingness to Send Job Creators Overseas
As elections approach and there is a lot of debate on which is the best road to a robust economy with more jobs, policymakers should take time to listen to the message of the just-released Kaufman Foundation videos on the benefits of high-skilled immigration. With Washington being unwilling to separate the obviously different issues of high-skilled immigration and how to handle illegal immigrants, a net job gain strategy remains hostage to politics as usual in the nation’s capitol.
History shows how many of America’s great job creators have been, since the beginning of the nation and until today, immigrant entrepreneurs. As Robert Litan noted in a recent op-ed, they are the main characters in the great American success stories—such as in AT&T, U.S. Steel, Dow Chemical Company, DuPont, Pfizer, Coors Brewing Company, H. J. Heinz Company, Kraft Foods, Procter & Gamble, Anheuser-Busch, MGM and Goldman Sachs.
In these must-view videos, U.S. company founders from other countries voice the losses for the U.S. economy due to visa backlogs for high-skilled immigrants. These losses are of course other nations’ gains, especially in today’s world where there is a global race to the top to build the best startup ecosystem and many countries are trying to attract entrepreneurial talents to their economies as part of their strategy. For those observing from the outside, the U.S. experience has been clear. They see that a great portion of Silicon Valley’s rock-star startups have had an immigrant founder or co-founder from India, China, Korea, Russia, India and other countries. Companies like Google, Yahoo and many others have created thousands of jobs for Americans. A study by Vivek Wadhwa and Annalee Saxenian showed that immigrants have accounted for roughly 25 percent of all successful high-tech startups in recent years, and over half of those in California.
The argument in favor of unlocking this source for job creation and innovation is not new. What these videos do is offer our leaders real stories. They put a face on the visa challenges for high-skilled immigrants that have been outlined in previous research and in the Kauffman Foundation’s Startup Act where research has shown that immigrants in the U.S. start companies at greater rates than native-born Americans do—and are disproportionately successful in starting high-tech firms.
Measures so far have failed short. The EB-5 visa reserved for immigrants who launch businesses in this country is not only limited in availability but also requires that they bring with them $1 million (or $500,000 if the business is started in a low-income area). Anyone who knows anything about startups knows that 80% of them start lean and few if any have $1 million in cash in the bank.
Current law ends up sending away roughly 60,000 immigrants who graduate with STEM degrees at U.S. universities each year. Through the bipartisan Startup Act 2.0, 50,000 new green cards for foreign graduates with STEM degrees from U.S. universities would be created annually and another 75,000 green cards would be authorized for immigrants establishing new businesses here and who meet certain new minimum investment and hiring benchmarks.
Let’s hope the campaign trails might air some of the types of stories in these videos and convince Washington that it is time to stop holding out for full immigration reform. Instead, they should focus on getting a startup visa in place for future high-skilled nascent entrepreneurs who want to keep their networks and talent here rather than take them home. Or shall we continue to serve the interests of other democracies around the world who are just fine with our sending them the world’s brightest job creators after their stay at America’s finest universities?