United States policymakers are failing to address the departure from this country of tens of thousands of talented immigrants — including engineers, doctors, lawyers and teachers. These highly-skilled workers are leaving the U.S. because they can’t obtain permanent residency here. Outdated immigration laws and regulations, bureaucratic delays and partisan bickering have created a Kafka-esque situation where the U.S. is inexplicably telling the smartest immigrants to go home. In the midst of a hotly contested presidential race in which immigration is a key issue, forget about actual immigration reform anytime soon. As per usual, U.S. politicians are all talk, but no action.
America’s “immigrant exodus,” as described by author Vivek Wadhwa (pictured above), should be very alarming for a country built on the backs and minds of immigrants. After over 200 years of welcoming immigrants into this country, the U.S. is now telling the best immigrants to go away, Wadhwa argues in his new book, The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial Talent. How many times in U.S. history have yesterday’s poor, tired, huddled masses spawned the next great entrepreneur, doctor, lawyer, or teacher? New York, Boston, Chicago, San Francisco, and Los Angeles were built by immigrants. Most attention gets focused on success stories like Andy Grove, Sergey Brin, and Elon Musk, but there are tens of thousands of less well-known immigrant entrepreneurs and other skilled professionals who want to stay in the United States but can’t, due to our byzantine and outdated immigration laws.
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This is but one example of a U.S. immigration system that’s terribly broken. We can fix it. It’s an issue that policymakers should pay attention to because their actions will have a direct impact on U.S. competitiveness over the next several decades. By now, the value of immigrant entrepreneurs to the U.S. economy is beyond doubt. But the appeal of the United States as an immigrant business incubator may be slipping away. A new study co-authored by Wadhwa and released by the Kauffman Foundation shows that the proportion of immigrant-founded companies nationwide has slipped from 25.3% to 24.3% since 2005, and in Silicon Valley, the percentage of immigrant-founded startups declined from 52.4% to 43.9% during that time. This is the wrong direction.
“For several years, anecdotal evidence has suggested that an unwelcoming immigration system and environment in the U.S. has created a ‘reverse brain drain.’ This report confirms it with data,” said Dane Stangler, director of Research and Policy at the Kauffman Foundation. “To maintain a dynamic economy, the U.S. needs to embrace immigrant entrepreneurs.” According to the study, immigrant founders are most likely to start companies in the “innovation/manufacturing-related services (45%) and software (22%) industries,” and employed some 560,000 workers nationwide. These companies generated an estimated $63 billion in sales from 2006 to 2012, the study found.
Last week, I had the opportunity to chat with Wadhwa, who came to the U.S. as an immigrant entrepreneur two decades ago, and has since become a U.S. citizen. Wadhwa, a journalist and college professor with appointments at Duke and Stanford, has developed a reputation as a smart tech policy commentator. ”Skilled immigrants have contributed disproportionately to U.S competitiveness,” Wadhwa told me in a phone interview. “They start an extraordinary number of companies and they file an extraordinary number of patents. They’ve been giving America its edge.”
Wadhwa says the neglected state of U.S. immigration policy has created a situation where we are kicking highly skilled workers out of the country before they’ve had a chance to fully realize their promise in America. The U.S. grants tens of thousands of education and work visas to skilled-immigrants every year, but because of arbitrary caps, the demand and need for such visas has now out-stripped supply. ”We bring people in as students, we bring them in to work for American companies, but we won’t let them stay beyond a short period of time.”
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As a result of this “reverse brain drain,” as Wadhwa and his colleagues called it in earlier research on this topic, highly skilled workers and professionals are increasingly looking to other global markets to locate their businesses. ”We’re seeing a boom in technology entrepreneurship in India, China, and even Russia, because the U.S. won’t let people stay here,” Wadhwa told TIME. “Their first choice is to be here. They came here, they’re working here, they want to stay here, but we won’t give them visas.”
This is a very bad trend for the U.S., especially at a time when we need to encourage and cultivate entrepreneurship and job creation at home. The toxic U.S. political climate — partisan bickering, congressional inaction, and bureaucratic inertia — have only worsened the problem. Both political parties are to blame — and the over-arching debate over undocumented immigrant amnesty has all but ruled out progress during an election year. ”Both the Democrats and the Republicans agree that we want the entrepreneurs, the scientists, the doctors, the researchers,” says Wadhwa. “Everyone agrees that we want these people to stay. But there’s a stalemate on the issue of amnesty for illegal workers.”
“The Democrats won’t let any legislation pass unless it solves the problem of the illegals,” Wadhwa adds. “The Republicans won’t let any legislation pass if it solves the problem of the illegals. It’s a quagmire, because they refuse to agree with each other. It’s two sides fighting each other mindlessly.” Wadhwa says the United States Congress should pass a law reforming our immigration system that allows the most talented immigrant entrepreneurs, engineers, lawyers, doctors to gain U.S. citizenship. Until then, our cash-strapped education system is simply going to train these people, before we send them back home.