Immigration : Canada’s Gain, America’s Loss in Entrepreneurship
Immigration to Canada Soars as U.S. Loses Immigrants
Immigration : In a surprising turn of events, the United States is witnessing a significant exodus of immigrants and international students to its neighbor to the north, Canada. The driving force behind this migration is Canada’s innovative and enticing startup visa policy for Immigration, which has been a beacon for talented individuals seeking new opportunities and a welcoming entrepreneurial environment. This trend comes on the heels of Canada’s recent success in attracting H-1B visa holders, with its program reaching its 10,000 application limit in less than 48 hours in July 2023.
New Research: Canada’s Startup Visa Attracts Immigrant Entrepreneurs
A groundbreaking study conducted by Saerom Lee and Britta Glennon from the Wharton School at the University of Pennsylvania sheds light on this remarkable shift in immigration patterns. Their research, based on a unique dataset from Revelio Labs encompassing 1.2 million U.S.-based individuals who founded companies between 2006 and 2021, reveals that Canada’s Start-up Visa Program, introduced in 2013, has had a profound impact.
Immigration & Factors
The study’s findings are astonishing, showing a 69% increase in the likelihood of U.S.-based immigrants starting businesses in Canada following the introduction of this immigration policy. Immigrants from Asian countries were particularly responsive to this policy change, underlining that immigration decisions are complex, often influenced by factors like social ties and embeddedness.
The Importance of Immigrant Startups: A Vital Economic Engine
Recent research underscores the critical role immigrant entrepreneurs play in the U.S. economy. According to the National Foundation for American Policy (NFAP), more than half of America’s startups valued at $1 billion or more were founded by immigrants or their children. The impact extends to the realm of artificial intelligence, where immigrants have founded the majority of top AI companies in the United States.
However, unlike Canada, the United States lacks a dedicated startup visa program. Despite years of advocacy from business groups and venture capital firms, foreign nationals typically do not start businesses in the U.S. until they become permanent residents.
Missed Opportunities in U.S. Legislation
In 2022, the America COMPETES (CHIPS) Act offered hope for reform with Rep. Zoe Lofgren’s LIKE Act, aimed at granting foreign-born entrepreneurs a pathway to lawful permanent residence. The CHIPS Act also sought to alleviate annual green card limits and backlogs for foreign nationals in critical industries.
Unfortunately, Senate opposition led by Senator Charles Grassley prevented these immigration measures from becoming law. Projections based on similar bills suggest that Rep. Lofgren’s LIKE Act could have generated millions of jobs in the United States over a decade.
A Plea for Immigration Reform
Speaking at a Senate Budget Committee hearing, Britta Glennon emphasized the significant gains in productivity, innovation, and economic growth that immigration can bring. Restrictive immigration policies, she argued, have already driven companies to relocate jobs and investments abroad, hindering U.S. businesses’ competitiveness.
The exodus of startups, jobs, investments, and innovation from the United States to countries with more open immigration systems is a growing concern. Glennon concluded that the United States’ outdated immigration laws undermine its competitiveness and economic dynamism, highlighting the urgency of immigration reform.
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