Immigrants Make Big Impact on U.S. Economy

February 2, 2015

From the first colonists to the heyday of Ellis Island, the U.S. has largely been built upon the backs of people who were not born here. But the economic impact of immigrants is more than just a matter of history. Even today, immigrants are the entrepreneurial engines that power the nation. From 1996 to 2011, the business startup rate for immigrants grew by more than 50 percent. In contrast, the number of companies started by U.S.-born citizens dropped by 10 percent.

The amount of money generated by immigrant-owned companies is staggering, adding up to more than $775 billion in sales in 2010. These companies employ 1 in 10 of all Americans who work in the private sector and pay out an estimated $126 billion in wages every year. With immigrants responsible for so much of the nation’s prosperity, one would think that the pathway to citizenship would be simple for any driven, qualified candidate. However, the unfortunate reality is that many foreigners have difficulty even obtaining temporary H-1B visas so they can work in the U.S. Meanwhile, other countries have streamlined their immigration policies in order to bring in as much outside talent as possible.

For instance, Canada recently advertised its revamped immigration laws with a billboard in Silicon Valley that read, “H-1B Problems? Pivot to Canada.” Besides trying to poach skilled engineers from Google and Apple, the Canadian billboard also carries a significant symbolic message to the industry. After all, the success of tech was largely immigrant-driven: non-native entrepreneurs founded 52 percent of Silicon Valley startups between 1995 and 2005. By 2012, those companies were employing 560,000 workers and generating $63 billion in sales. Now, though, the number of businesses in the area begun by immigrants has declined by 8.5 percent. “Companies are in a global competition for talent, and other countries are rolling out the red carpet for them while we are rolling out the red tape,” said Emily Lam of the Silicon Valley Leadership Group. While President Obama has said he could soon implement key immigration reforms with an executive order, many believe that the problem has grown so big that it can only be solved by legislation passed by Congress.



  1. Why do immigrants start the majority of new businesses in the U.S?
  1. Would it be a good idea for the U.S. to expand the H-1B program?


Source: Adam Bluestein, “The Most Entrepreneurial Group in America Wasn’t Born in America,” Inc., February 2015. Photo by: John Barker.