Entrepreneur-Friendly Immigration Reform
Steve Case must be an optimist. The co-founder of America Online and current CEO of blue-chip venture firm Revolution LLC thinks a bipartisan majority in Congress will pass immigration reform this year … or at least the targeted reform of Startup Act 3.0, a bill designed to keep the best of foreign-born brains and talent in the U.S.
Immigration is a hot-button issue but, whatever their feelings about comprehensive immigration reform (dealing with the 11 million illegal immigrants living in the U.S.), business leaders and advocates are pushing the message that the political snarl over immigration is hurting American business by preventing the world’s best and brightest from working here. Knowledge-intensive industries such as information technology and biotech are especially impatient for the reforms that Startup Act 3.0 promises.
Startup Act 3.0 (a nice techy sounding name that also reflects the fact that Startup Act 2.0 died in Congress last year) contains a bipartisan set of measures expanding current visa regulations. The new act would:
- Create a special entrepreneur’s visa for legal immigrants aimed at encouraging foreign-born workers to start companies. Consequently, immigrants won’t have to depend on a company to sponsor their residence in the U.S.
- Create a new visa specifically for the STEM (Science, Technology, Engineering, Math) professions
- Eliminate per-country caps for employment-based visas, encouraging U.S. companies to hire talent wherever it’s found
The act also institutes five tax, procedural, and funding measures to encourage new business formation. It was introduced in February by a bipartisan congressional team that included Republicans, such as Sen. Jerry Moran, R-Kansas, and Sen. Roy Blunt, R-Missouri, and Democrats, such as Sen. Chris Coons, D-Delaware, and Sen. Mark Warner, D-Virginia. The act is meant to answer a long-standing frustration for business leaders: our laws make it easy for the foreign-born to get an American education, but difficult for them to start an American company.
The U.S. leads the world in size and quality of its education sector. Twenty of the U.S.News & World Report top-50 universities are in the U.S. Half of the Financial Times top-50 global business schools are American. And, the list goes on—technical schools, medical schools, law schools—the world’s best and brightest come here to learn. (Consider that students at Babson College come from more than 60 countries.)
But, as Bill Gates points out, U.S. immigration policy disregards this asset. “You can be a student at UC Berkeley, foreign-born, and get this wonderful subsidized education. Microsoft offers you a job for over $100,000 a year [but] … most of those students are told they can’t stay. They have to go to Canada or India or somewhere else.”
Supporters of Startup Act 3.0 also say America’s shortage of native-born STEM professionals makes reform urgent. For example:
- In 2009, 33 percent of U.S. science and engineering doctorates were earned by students on temporary resident visas
- More than 200,000 science and engineering doctorates1 were earned in the U.S. by foreigners from 1987–2007
- More than 60 percent of employees in Silicon Valley tech companies are foreign-born
Foreign-born graduates have a strong influence across all industries in Silicon Valley, not just those in the STEM fields. Forty-seven percent of Silicon Valley’s college-educated workforce is international, although nationally, this figure drops to 17 percent. Annually, Congress issues 85,000 new H-1B visas for the highly trained workers that make up this 17 percent, and that allocation hasn’t changed in nearly a decade despite the acceleration of tech jobs. That simple math indicates shortage and its predictable effects—recruiters from Canada, Latin America, Europe, and Asia can offer easier routes to employment to elite non-U.S. engineers, PhDs, and professionals.
Politically, Startup Act 3.0 is meant to answer the complaint that foreigners will take American jobs. Says Case, “The mistake that opponents of immigration reform make is believing that our society and economic growth are zero sum. They are not. More talented immigrants joining the American family does not equate to fewer jobs, it equates to more jobs. … Studies show that from 2000 to 2007, every 100 additional foreign-born workers in STEM fields created 262 additional employment positions for native U.S. workers.”
The bottom-line appeal of Startup Act 3.0—hundreds of thousands of jobs created by the brains and entrepreneurial zeal of foreign-born individuals—gives it a fighting chance of becoming law this year. The lure of new job creation in a struggling economy has bridged divisions between influential conservatives and liberals already; the votes might just be there to reform America’s attitude toward foreign-born entrepreneurs.
1Source: National Science Foundation Report Higher Education in Science and Engineering, Chapter 2
Posted in Living Entrepreneurship