Unbelievable as it feels to type this, but July 4 is closer than you think. With that, perhaps a little conversation about the “American Dream” is in order. People come to the United States for a variety of reasons including to unite with their family members, to get a world-class education, or perhaps to flee oppression in their home country because of their religious, political or other beliefs.
Others come to the United States to pursue employment or business opportunities. Some might characterize that as coming to the United States to pursue the “American Dream.” The Oxford English Dictionary defines the American dream as “the ideal that every citizen of the United States should have an equal opportunity to achieve success and prosperity through hard work, determination, and initiative.” For many aspiring immigrants, their goal is to come to the United States to start a business. The United States has always been considered a land of opportunity for those with a vision and the drive to work hard to achieve their dream.
Without regard to “immigration” considerations, it takes a lot effort and hard work to start a business. Add immigrant and nonimmigrant visa considerations to the mix, and the work and effort becomes exponentially harder. Those who start down that path will often start with temporary visas, maybe eventually obtain permanent residence, and, if they want, to eventually naturalize (i.e., obtain citizenship), if they wish and are otherwise qualified. More often than not, with or without creative lawyering, there’s going to be a path to get those who wish to pursue the American Dream here to do so.
Immigrants Make up a Large Number of Domestic Entrepreneurs
Experts estimate that approximately 3.2 million immigrant entrepreneurs operated domestic businesses in 2019. These hard-working immigrants employ roughly 8 million people and add $1.3 trillion in sales to the domestic economy annually. In the New York-Northern New Jersey-Long Island metropolitan area in 2018, nearly one-third (thirty-one percent) of business owners were immigrants.
No surprise that in New York alone, the data is just as impressive. Consider the following:
- Nearly a quarter of New York residents are immigrants, while almost one-fifth of residents are native-born U.S. citizens with at least one immigrant parent.
- Nearly three in five immigrants in New York are naturalized U.S. citizens.
- About one in four workers in New York is an immigrant, together making up a vital part of the state’s labor force in a range of industries. 2.8 million immigrant workers comprised 28 percent of the labor force in 2018.
- Immigrants in New York have contributed tens of billions of dollars in taxes. Specifically, immigrant-led households in New York paid $35.4 billion in federal taxes and $21.8 billion in state and local taxes in 2018. Undocumented immigrants in New York paid an estimated $2.3 billion in federal taxes and $1.4 billion in state and local taxes in 2018. New York DACA recipients and DACA-eligible individuals paid an estimated $113.4 million in state and local taxes in 2018.
- As consumers, immigrants add well over a hundred billion dollars to New York’s economy; New York residents in immigrant-led households had $120.5 billion in spending power (after-tax income) in 2018.
- Immigrant entrepreneurs in New York generate billions of dollars in business revenue. 348,547 immigrant business owners accounted for 34 percent of all self-employed New York residents in 2018 and generated $7.8 billion in business income.[1]
Immigrant entrepreneurs have also played a crucial role in our economy’s long-term recovery since the 2007 recession.[2] Specifically, at the same time that many natural-born United States citizens decided against starting businesses, leading to declining rates of entrepreneurship, immigrants did the opposite; that is, they approximately doubled their rate of entrepreneurship since the 1990s. Recent studies have shown that immigrants make up more than 25% of entrepreneurs.[3] Some of the surge in immigrants starting businesses had its roots in EB-5 immigrant investor visa program
Immigrants Don’t Have to Wait to Start Their Dream Business
Some people actually believe that they need to become a U.S. citizen before they can start a business in the United States. That is just not the case. Those with a little or a lot of education, some experience, and yes sometimes financial resources, can invest in a company, either as a start-up or an existing company. They can potentially qualify for a temporary (i.e., nonimmigrant) or even permanent (i.e., immigrant or “green card”) visa, based on their investment in a new commercial enterprise, expansion of an existing one, or purchasing all of the assets or shares (or ownership interest) of an existing business altogether.
There are often options, but it does take careful consideration and a thorough understanding of the entrepreneurial business cycle, the visa categories that support them, timing, and your client’s objective. In my experience, more often than not an immigrant investor is more motivated by the prospect of receiving his or her “green card” than by any clear business goals and objectives. My responsibility is to identify the individual’s personal and business goals, managing timing expectations, and hopefully set up a long-term strategy that will accomplish both. Assuming it does, the data is clear that immigrant entrepreneurship and business creation is fundamental to a healthy U.S. economy.
[1] See American Immigration Council (most recently) at https://www.americanimmigrationcouncil.org/research/immigrants-in-new-york
[2] See New American Economy (most recently) at https://www.newamericaneconomy.org/issues/entrepreneurship/
[3] Id.