Immigrant Founders Need Policy Reform To Keep Creating Tech Jobs

President Obama took executive action last November to further ease policies around skilled tech labor. However, our laws haven’t done much to help the foreign startup founders who create quite a few tech jobs here.

A 2008 Kaufman Foundation study concluded that between 1995 and 2005, more than half of all Silicon Valley tech companies were created by immigrant founders, employing 560,000 workers and generating $63 billion in sales.

But something changed in 2006. There was a commonly estimated 12 million illegals living in America at the time. New reforms that were supposed to make it easier for immigrants who’d been here a while to obtain worker visas seemed to be making it harder for those with startups.

The Comprehensive Immigration Reform Act of 2006 allowed those who’d been in the country for 2-5 years to stay, but would required them to return to their country of origin after 3 years. Meanwhile, those who’d been here less than 2 years would have to leave.

Vivek Wadwha suggested in his book ‘The Immigrant Exodus’ that the changes to U.S. immigration policy was causing a brain drain in Silicon Valley.

This was seemingly confirmed in a follow-up Kaufman study, showing that the number of immigrant-founded startups dropped from 52 percent to less than 44 percent in 2012.

This suggests would-be Silicon Valley entrepreneurs were having a harder time getting the visas they needed to start businesses here.

immigrantstartups

U.S. employers can currently sponsor foreign workers with a temporary H-1B visa. However, those visas are capped at 65,000 a year. This limits the amount of workers able to stay and add to the economy here. Further, immigrants trying to start their own company have no such employer sponsorship.

Canada saw an opportunity to poach Silicon Valley talent in 2013 with a billboard campaign strategically placed on the Peninsula of California’s highway 101. Signs read, “H-1B Problems? Pivot to Canada.”

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