Article Review: Immigrants Play a Disproportionate Role in the American Economy (HBR)


In doing research for my most recent blog post, I stumbled across an article from last October (2016) in Harvard Business Review.1  The article is consistent with what I have read in the past and have come to believe is the truth.  Immigrants to the United States disproportionately start high growth businesses.  Here are a couple of tidbits that had me thinking:

  1. Entrepreneurs make up 15% of the general population – but 25% of the immigrant population.

  2. The number of entrepreneurs and new firms started by immigrants has been increasing since the mid-1990s, a time when overall entrepreneurship has been slowing.

  3. Immigrant firms tend to close more often, but when they succeed they grow bigger than native firms.

I find the role of immigrant founders particularly important to Omaha’s economic development strategy based on current evolving public policy regarding H-1Bs and the general openness to immigration as a country.  One key line in this article summed up one view that I think is consistent to many policy makers from many different viewpoints: 

"One argument you tend to hear in the immigration debate in the U.S. is that there is a fixed number of jobs in the economy — and immigrants just compete for a slice of the pie rather than helping the pie grow. This perspective is less prevalent when talking about startups, however, because the rate of entrepreneurship has declined significantly in the U.S. over the last 30 years, and fewer startups are being generated today.”

This issue is an important one, and as community builders, it is critical that we understand the role of immigration on building great companies for our company.


Tom Chapman