While some aspects of comprehensive immigration reform are contested, most members of both parties agree that the country needs high-skilled immigrant workers. But perhaps what we need even more are immigrant entrepreneurs to start up new businesses. Unfortunately, the immigration system offers no visa for self-employed immigrants. Visas and green cards require employer sponsorship.
Therefore, countless potential entrepreneurs from around the world are stopped from coming here to build their companies. Congress is actively blocking job creators, wealth producers, and inspiring entrepreneurs from working and building in this country.
The U.S. immigration system is primarily based on family reunification. A worthy goal, it allows many family members from abroad to come and live with American relatives. However, the focus on family prevents employment-based immigration from having a large role in promoting economic growth. Unfortunately, employment-based immigration is a long, arduous, and expensive process. To make matters worse, only 85,000 visas are awarded each year for high-skilled immigrants, like those in STEM fields.
If the process were easier, more firms could take advantage of high-skilled immigrant labor and more Americans could reap the economic benefits.
But the problem for entrepreneurs is even more pronounced. When one thinks of an entrepreneur, one often imagines young visionaries like Steve Jobs working tirelessly out of their garages. But the process of creating a company often sees setbacks, failures, and roadblocks.
Entrepreneurship is inherently risky. Bloomberg columnist Megan McArdle explains that entrepreneurs are like baseball players: the best ones fail seven out of ten times. And being an entrepreneur means being one’s own boss. But U.S. immigration law punishes such risk-taking because one cannot legally be a self-employed immigrant entrepreneur.
How does Congress expect immigrant entrepreneurs to succeed when they are not given the legal opportunities to build companies? If a company goes under, it’s a one-way ticket out of the country for that immigrant unless he or she can quickly find a new job.
But immigrant entrepreneurs can go to Canada, New Zealand, Italy, Korea, Germany, or Singapore, which have some version of a startup visa. So job creators move overseas. The Kauffman Foundation finds that without launching a new startup visa, the United States will miss the opportunity to create 1.6 million new jobs over the next 10 years.
Legislation has been introduced in Congress to launch a startup visa. The Startup Visa Act was first introduced in 2010 with bipartisan support but never passed. Many proposals have requirements that would shut out most entrepreneurs, especially potential small-business owners.
While it is more popular to discuss illegal immigration, the fact remains that three-fourths of immigrants are here legally. While many people like to discuss the problems with illegal immigration, the truth is that the legal immigration system is broken, as evidenced by the lack of a startup visa.
Entrepreneurs should have legal channels to enter the United States and to work independently to start new businesses. Instead of applying the H-1B rules, which heavily restrict the number of visas, require an employer sponsor, and have only a three-year term, the rules for high-skilled immigrants and immigrant entrepreneurs should be liberalized.
Immigrant entrepreneurs like Google’s Sergei Brin and eBay’s Pierre Omidyar came to this country through the family-reunification process, but we shouldn’t have to rely on this uncertain process. It makes more sense to include a system that would admit entrepreneurs directly.
New immigrant-founded Fortune 500 companies and Silicon Valley startups could add millions of jobs to the U.S. economy if Congress modernized the legal immigration system. With the economy still struggling to operate at full speed, Congress should launch a new entrepreneur visa now.