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The Economic Impact of Immigration on the U.S

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The Economic Impact of Immigration on the U.S HE CONOMIC MPACT OF T E I I MMIGRATION ON THE U.S. June 2017 ii June 2017 The Economic Impact of Immigration on the U.S. ACKNOWLEDGEMENTS Special thanks to the following organizations for their support: Carbonite, CHEN PR, Foley Hoag, Goodsill Anderson Quinn & Stifel, TripAdvisor, and WireStone. And, thank you to the many individuals who contributed time and energy to our research and advocacy on this important issue: Catherine Alford, Mohamad Ali, Amitay Alter, Almudena Arcelus, Grace Brittan, Kip Brown, Marric Buessing, Kristyn Bunce DeFilipp, Sean Burpoe, Lenore Byers, Chris Carleton, Sonia Cheung, Pierre-Yves Cremieux, Nick Dadson, Tracy Danner, Matt Driver, Akanksha Dua, Sorcha Evenhouse, Adam Feifel, Catherine Fernan, Desiree Fish, Aaron Fix, Max Flignor, Sara Fraim, Emily Gao, Sam Green, Norman Guadagno, Carro Halpin, Christopher Hart, Owen Hearey, Alex Henslovitz, Ryan Hiatt, Alison Hill, Hunter Hillman, Victoria Hopcroft, Tom Hopcroft, Grace Howland, Samantha Jandl, Patrick Johnson, Seth Kalvert, Steve Kaufer, Michael Keating, Sarah King, Olga Korolev, Nguyen Le, Jee-Yeon Lehmann, Christopher Llop, Dana Louie, Tarek Makawi, Federico Mantovanelli, Rosamond Mate, Sean McCoy, Dan McFadden, Kate McLeod, Liz Milsark, Pedro Mora, Ruth Morris, Liz Neyens, Amanda Nguyen, Caitlin O'Malley, Alec Paulson, Shaked Peleg, Clemens Pilgram, Greg Rafert, Nina Roesner, Peter Rosenblum, Aidan Saavedra Buckley, Kate Schoenbach, Shannon Seitz, Riddhima Sharma, Jesse Shea, Danielle Sheer, Yanying Sheng, Eric Smiley, Mike Spinney, Ian Staeheli, Patricio Suarez Urtaza, Matt Summers, Neal Tan, Evelyn Taylor- McGregor, Brett Tobin, David Toniatti, Kate Uthe, Jahnvi Vaidya, Katie Williams, Frances Yen, Brad Young, Tom Yu, Haimin Zhang, and Luise Zhong. ii June 2017 The Economic Impact of Immigration on the U.S. INTRODUCTION The Massachusetts Technology Leadership Council (MassTLC), the region’s largest non-profit technology organization, joined the national conversation on the role that immigrants play in our economy with its submission of amicus briefs in the District Court of Hawaii and the U.S. Court of Appeals for the 4th and 9th Circuits. These briefs support the plaintiffs in those cases, who have sought to enjoin the President’s Executive Orders restricting travel to the U.S. from certain countries. While it is well understood within the technology community that diversity and the global mobility of talent and ideas into our country are critical drivers of U.S. innovation, economic growth, and global competitiveness, we felt that the submission of amicus briefs requires better documentation and sourcing of these commonly held truths. This report reflects our work to document the impact that immigrants have on our economy. We entered this dialogue on behalf of the tech community in Massachusetts because, as a leading technology state, we feel the acute impact that immigrants have in our economy. As Governor Charlie Baker noted, “Massachusetts is a global community, and we all benefit from the shared experiences of our partners from around the world to support our economy and educational institutions [and] make our state the best place to live, work, and raise a family.” This report illustrates a rich tapestry of unique impacts across the country. We hope this compilation of research contributes to a productive dialogue about the important role immigrants play as critical drivers of our national leadership in innovation, economic growth, and global competitiveness. We encourage readers of this report to lend their voices to the conversation and use this research to complement personal insights and experiences about the role of immigrants. We welcome broad sharing of this report and have made it freely available for download at the following URL: www.MassTLC.org/Immigration. Thank you, Thomas Hopcroft Mohamad Ali Steve Kaufer President & CEO President & CEO President & CEO Mass Technology Carbonite, Inc. TripAdvisor, Inc. Leadership Council, Inc. Trustee, MassTLC Member, MassTLC iii June 2017 The Economic Impact of Immigration on the U.S. iv June 2017 The Economic Impact of Immigration on the U.S. v June 2017 The Economic Impact of Immigration on the U.S. TABLE OF CONTENTS I. EXECUTIVE SUMMARY............................................................................................................................... 1 A. THE IMPACT OF IMMIGRATION ON THE TECH INDUSTRY ..................................................................................................... 1 B. THE IMPLICATIONS OF THE TRAVEL BAN ON INNOVATION AND THE ECONOMY ....................................................................... 3 II. COST TO BUSINESSES IMPOSED BY THE EXECUTIVE ORDER............................................................................ 5 C. DEMAND FOR H-1B WORKERS ....................................................................................................................................... 6 i. Massachusetts-Specific Facts ............................................................................................................................ 7 D. THE ROLE OF IMMIGRANTS IN THE TECH INDUSTRY ............................................................................................................ 7 i. Massachusetts-Specific Facts ............................................................................................................................ 8 E. THE ROLE OF IMMIGRANTS IN MEDICINE ......................................................................................................................... 9 i. Massachusetts-Specific Facts .......................................................................................................................... 10 F. IMPACT OF VISA RESTRICTIONS ON AMERICAN EMPLOYERS............................................................................................... 11 i. Potential Impact of the Proposed Order on Risk and Instability of American Workforces ........................... 11 ii. Potential Impact of the Proposed Order on the Competitiveness of U.S. Firms ............................................ 11 iii. Outsourcing ...................................................................................................................................................... 12 iv. Impact on Massachusetts ................................................................................................................................ 12 III. IMPACT OF IMMIGRANTS ON INNOVATION AND PRODUCTIVITY .................................................................. 15 A. IMMIGRANTS IN LEADERSHIP POSITIONS......................................................................................................................... 15 B. INNOVATORS FROM TARGETED COUNTRIES .................................................................................................................... 17 C. IMPACT OF IMMIGRANTS ON PATENT ACTIVITY ............................................................................................................... 18 D. COMMERCIAL VALUE OF IMMIGRANT PATENTS ............................................................................................................... 19 E. IMMIGRANTS PATENTING BY FIELD ................................................................................................................................ 19 F. SPILLOVER EFFECTS ON INNOVATION BY IMMIGRANTS ...................................................................................................... 20 G. IMPACT OF VISA RESTRICTIONS ON INNOVATION AND PATENTING ...................................................................................... 22 H. IMPACT OF IMMIGRANT STUDENTS ON INNOVATION AND PATENTING ................................................................................ 23 I. IMPACT OF IMMIGRANTS ON FIRMS ............................................................................................................................... 24 J. IMPACT OF IMMIGRANTS ON PRODUCTIVITY ................................................................................................................... 25 IV. IMPACT OF IMMIGRANTS ON ENTREPRENEURIAL ACTIVITY ......................................................................... 28 A. THE IMPACT OF IMMIGRANTS ON NEW BUSINESS STARTS BY SECTOR ................................................................................. 28 B. THE RELATIONSHIP BETWEEN ENTREPRENEURSHIP AND IMMIGRATION STATUS, PARTICULARLY IN HIGH-TECH SECTORS ............ 28 i. Literature Review .............................................................................................................................................. 28 a. Share of Business Founders ......................................................................................................................... 29 b. Business Formation Rate ............................................................................................................................. 30 ii. Descriptive Tables from Fortune 500 Companies ........................................................................................... 34 iii. Descriptive Tables from Survey of Business Owners, 2007 and 2012 ............................................................ 36 C. IMPACT OF NEW BUSINESSES STARTED BY IMMIGRANTS ................................................................................................... 43 i. Estimates of Sales, Employment, and Payroll Generated by Immigrant-Owned Firms in 2012 ..................
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