Immigrants start small businesses at twice the rate of the native-born

Immigrants have long been disproportionately likely to found small businesses, but a new report on entrepreneurship in America shows that the foreign-born are becoming increasingly central to this aspect of the American economy:

Kaufmann Foundation

The turning points appear to have been the downturn in the house-building market and then the subsequent recession. While native-born Americans became slightly less likely to launch businesses during the tough economy (possibly due to difficulty securing credit), immigrants responded to a weak job market by turning to self-employment.

As a result, immigrants now account for 28.5 percent of all entrepreneurs in the United States — way up from 13.3 percent in 1996.

Immigrants are very disproportionately involved in high-flying Silicon Valley startups, but the typical immigrant entrepreneur is engaged in something more humble — more likely a taqueria or a dry-cleaning shop than the next Google. For hardworking, ambitious immigrants who may lack the language skills or formal educational credentials to secure good jobs in traditional workplace settings, starting a small business can be the best path to get ahead.

But policymakers looking to assist small businesses — and even companies looking to market services to them — rarely focus on the unique needs and circumstances of an immigrant community. With nearly a third of small firms owned by the foreign-born, it's time for that to change.

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