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Immigrants’ Role in the Small Business Economy Grows


The share of U.S. small businesses owned by immigrants has expanded by 50 percent since 1990, with almost one-fifth of business owners born outside the country, according to a new report (PDF) by the Fiscal Policy Institute.

The number of foreign-born business owners has increased in tandem with the immigrant workforce. Immigrants made up about 9 percent of workers in 1990 and 12 percent of business owners with fewer than 100 employees, according to the report, which analyzed U.S. Census data. In 2010, the foreign-born share of the workforce had grown to 16 percent, and immigrants made up 18 percent of small business owners.

“It’s gone from a modest size of business owners to a pretty substantial size of business owners,” says David DyssegaardKallick, a fellow at the institute who authored the report.

The conversation around immigrants’ role in the economy is often dominated by two oversimplified ideas, he says. Immigrants are either seen as strictly in competition with native-born workers for jobs, or immigration is seen as magic bullet to revive stagnant economies. While the impact of immigrants on job growth can be overstated, he says, “people sometimes don’t realize that when immigrants come into the economy, the economy also grows.”

Immigrants from the Mediterranean and Middle East had the greatest rate of business ownership. At least 10 percent of workers from Greece, Israel, Syria, Iran, Lebanon, Jordan, and Italy were business owners, according to the report. The most common types of businesses were service enterprises, such as restaurants, doctors’ offices, real estate companies, and retail stores.

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