An ‘entrepreneur visa’ can help us keep our competitive edge

President Trump has repeatedly called for a U.S. immigration system based on the economic value of those admitted. The president is correct that, at present, the United States accords a lower priority to the economic benefits of potential admittees than most other developed nations. 

Of the 1.1 million permanent residency green cards issued annually, 85 percent go to family members of U.S. citizens or permanent legal residents, people seeking political asylum or humanitarian refuge and “diversity immigrants.”  

{mosads}Only 15 percent of green cards are allotted based on the economic skills of the applicants — and half of those go to the workers’ spouses and children. For other countries — including China, Australia, Canada, Britain, South Korea, Denmark, Chile, Switzerland and Spain — the ratio is flipped, with as much as 80 percent of their visas issued for economic reasons.

In a global economy in which the competition for talent is increasingly fierce, the United States needs an immigration framework consistent with its national identity as a land of opportunity and refuge for the world’s “tired, poor, huddled masses,” but also one that places greater emphasis on attracting and retaining the world’s best and most innovative talent. 

Though “economic value” is frequently defined in terms of educational attainment, there is no immigrant category of greater economic value to the United States and its citizens than a foreign-born entrepreneur who wants to launch their new business in America. 

New businesses create jobs for Americans, contribute to innovation, economic growth and expanding opportunity, and, once profitable, pay federal, state and local taxes.  

Foreign-born entrepreneurs have been a prominent feature of America’s economic landscape for many decades. Iconic American companies founded by immigrants include:

• Dow,
• AT&T,
• DuPont,
• Levi Strauss,
• Anheuser-Busch,
• Pfizer,
• Goldman Sachs,
• Sun Microsystems,
• Google,
• Yahoo,
• eBay,
• YouTube,
• PayPal,
• Tesla and
• LinkedIn.  

A recent study by the Center for American Entrepreneurship found that 43 percent of Fortune 500 companies and 57 percent of the top 35 companies were founded by immigrants or a child of immigrants. These companies are headquartered in 68 metro areas across 33 states and employ millions of Americans.

Yet, the United States is one of only a few industrialized nations that does not have a visa category specifically designated for foreign-born entrepreneurs. In recent years, many other nations — including China, Canada, Germany, France, New Zealand, Australia and Chile — have overhauled their immigration laws to attract foreign-born entrepreneurs, including American entrepreneurs. 

Most recently, on June 13, 2018, the United Kingdom announced the creation of a “start-up visa” to attract and retain foreign-born entrepreneurs.

America is already feeling the heat of heightened competition. Last year, more new technology jobs were created in Toronto than in Silicon Valley, Seattle and Washington, D.C. combined.

Given this new competitive reality, Congress should create a new visa category — an “entrepreneur visa” — specifically designated for foreign-born entrepreneurs who want to launch new businesses in the United States.  

To qualify for an entrepreneur visa, applicants should meet national security requirements and should be required to have raised a certain amount of initial funding from private investors to validate themselves as entrepreneurs and to authenticate their business idea.  

Under the terms of the entrepreneur visa, foreign-born entrepreneurs should be admitted on a temporary contingency basis, say for two years.

If by the end of that period an entrepreneur’s business has been successfully launched and has produced jobs for at least two non-family members, the temporary visa should be extended, say, for an additional three years. 

{mossecondads}If the new business continues to grow and has created jobs for at least five non-family members by the end of the initial five-year period, the foreign-born entrepreneur should be granted permanent residency status — a green card — in order to continue building his or her business and creating American jobs. 

A 2013 study by the Kauffman Foundation concluded that an entrepreneur visa would create between 500,000 and 1.6 million new American jobs within 10 years. Other studies have estimated that a new visa category for foreign-board entrepreneurs could create as many as 3 million new American jobs over a decade.

Most importantly, an entrepreneur visa will help ensure that the United States and American workers are not disadvantaged in the increasingly fierce global competition for innovative talent. 

Foreign-born entrepreneurs have created many of America’s largest and most successful companies; we want the next generation of great companies launched in America too.

John R. Dearie is the founder and president of the Center for American Entrepreneurship. Follow the organization on Twitter: @startupsUSAorg.