The Startup Act 2.0 Signals That Congress Is Finally Thinking About the Positive Impact Immigration Has on the Economy
On May 22, 2012 Senators Marco Rubio (R-Fla.), Chris Coons (D-Del.), Jerry Moran (R-Kan.), and Mark Warner (D-Va.) introduced the Startup Act 2.0 to members of Congress. The Startup Act 2.0 would create two new types of visas: (1) one for foreign students who obtain graduate degrees in the STEM fields of science, technology, engineering and mathematics and (2) a visa for immigrants who start successful companies and create jobs in the United States. Both categories carve out a pathway towards permanent residence and eventually U.S. citizenship. In order for an immigrant to qualify under the second category of visa geared towards, he or she must launch a business that has at least two unrelated full-time employees and their business must raise a capital of at least $100,000. Additionally, the Startup Act 2.0 will eliminate caps on the number of work-based visas given to each foreign nation in the hopes of creating an easier path for skilled immigrants to bring their talent and ideas to the U.S.
The Startup Act 2.0 also seeks to aid the creation of startups. The Act provides tax credits for new business and provides incentives for investment in new business. It will also use federal funds to help universities bring their research to the marketplace.
This new bill comes on the heels of several studies indicating the increased role of immigrant entrepreneurs and job creation. One study published by the Kauffman Foundation, based on Census data and the U.S Labor Department’s current population survey, show that the number of small business is growing significantly. Hispanics, according to the study, are leading the charge and creating new businesses at a faster rate than any other ethnic group and at a rate that exceeds their population growth. In fact, immigrants created about 28% of all new businesses last year and were twice as likely to start new business than U.S. born citizens.
The Startup Act 2.0 is a good starting point to begin a much-needed overhaul of the employment-based visa system. However, the bill may not go far enough in encouraging entrepreneurship. The bill focuses on the STEM fields, however a good portion of the businesses created by immigrants are not in the STEM fields. With the majority of American graduates majoring in non-STEM fields, it may be best to include more types of small businesses in this bill. The key here is job creation. While the future of this bill remains to be seen, what is certain is that Congress is finally realizing the significant roles immigrants play in the economy, not just as job seekers but as job creators.
