Immigrant entrepreneurs ignite economy
Foreign-born business owners have become critical to the economic growth of major U.S. cities, a recent study finds.
NEW YORK (CNNMoney.com) -- Foreign-born workers have become a powerful engine of growth in the U.S., according to a report Tuesday.
Immigrants have become increasingly critical in major cities thanks to a surge in population and their entrepreneurial spirit, according to the Center for an Urban Future's report titled "A World of Opportunity: Understanding & Tapping the Economic Potential of Immigrant Entrepreneurs."
The New York City-based think tank found that immigrants are more likely to be self-employed than non-immigrants, which has been underscored by a prolonged burst of new immigration, at levels not seen since early in the 20th century.
Not only are immigrant entrepreneurs starting a greater share of new businesses than native-born residents but they are also spurring growth in sectors from food manufacturing to health care, according to the report, which focused on New York, Los Angeles, Houston and Boston.
"Immigrant entrepreneurs are now the entrepreneurial sparkplugs of cities," Jonathan Bowles, director of the Center for an Urban Future, said in a statement.
"While immigrants have a long history of starting businesses in the U.S., their contributions have grown in recent years thanks to an explosion of immigration and their high rates of business formation. They are an incredible asset for cities that has only begun to be tapped for economic development," Bowles said.
In New York City, immigrants made up 36 percent the population, yet they accounted for nearly half, or 49 percent, of all self-employed workers in the city, as of 2000.
Immigrants drove all of the growth in the city's self-employed population between 1990 and 2000: the number of immigrants who were self-employed jumped 53 percent while the number of native-born people who were self-employed fell 7 percent.
In Los Angeles, first-generation immigrants created at least 22 of LA's 100 fastest growing companies in 2005.
Los Angeles County has more Asian-owned firms and Hispanic-owned businesses than any county in the U.S. Meanwhile, Houston ranks third among all U.S. cities in the number of Hispanic-owned businesses and sixth in the number of Asian-owned firms.
Immigrant entrepreneurs have also provided a major boost in the resurgence of many Boston neighborhoods including Fields Corner, East Boston, Allston Village and Jamaica Plain.
The number of Hispanic-owned firms in Boston increased by 97 percent between 1997 and 2002 while the number of Asian-owned businesses grew by 41 percent.
Between 1980 and 2000, foreign-born individuals accounted for 128 percent of the overall population growth in New York City, 97 percent in Los Angeles, 101 percent in Houston, and 357 percent in Boston.