Findings fly in face of UN's arguments

[hipka]

Several people on this board have consistently claimed that US would not lose talent due to retrogression, immigrants constitute only a small portion of the workforce, it does not matter if people get discouraged and go back to their country due to retrogression etc. The article pasted below shows that immigrants do contribute a great deal to the US, even brilliant people are affected by retrogression in EB3 and EB2 and the US stands to lose a lot if they are discouraged by retrogression. UN, please comment

Immigrants behind 25 percent of startups By RACHEL KONRAD, AP Technology Writer
Wed Jan 3, 11:08 PM ET



SAN FRANCISCO - Foreign-born entrepreneurs were behind one in four U.S. technology startups over the past decade, according to a study to be published Thursday.

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A team of researchers at Duke University estimated that 25 percent of technology and engineering companies started from 1995 to 2005 had at least one senior executive — a founder, chief executive, president or chief technology officer — born outside the United States.

Immigrant entrepreneurs' companies employed 450,000 workers and generated $52 billion in sales in 2005, according to the survey.

Their contributions to corporate coffers, employment and U.S. competitiveness in the global technology sector offer a counterpoint to the recent political debate over immigration and the economy, which largely centers on unskilled, illegal workers in low-wage jobs.

"It's one thing if your gardener gets deported," said the project's Delhi-born lead researcher, Vivek Wadhwa. "But if these entrepreneurs leave, we're really denting our intellectual property creation.

Wadhwa, Duke's executive in residence and the founder of two tech startups in North Carolina's Research Triangle, said the country should make the most of its ability to "get the best and brightest from around the world."

The study comes nearly eight years after an influential report from the University of California, Berkeley, on the impact of foreign-born entrepreneurs.

AnnaLee Saxenian, now dean of the School of Information at UC-Berkeley, estimated immigrants founded about 25 percent of Silicon Valley tech companies in 1999. The Duke study found the percentage had more than doubled, to 52 percent in 2005.

California led the nation, with foreign-born entrepreneurs founding 39 percent of startups, even though they make up only 25 percent of the state's population. In New Jersey, 38 percent of tech startups were founded by immigrants, followed by Michigan (33 percent), Georgia (30 percent), Virginia (29 percent) and Massachusetts (29 percent).

Saxenian, also co-author of the new study, said the research debunks the notion that immigrants who come to the United States take jobs from Americans.

"The advantage of entrepreneurs is that they're generally creating new opportunities and new wealth that didn't even exist before them," Saxenian said. "Just by leaving your home country, you're taking a risk, and that means you're willing to take risks in business. You put them in an environment that supports entrepreneurship, and this is the logical outcome."

Researchers started with a list of 28,766 companies classified as technology and engineering companies in Dun and Bradstreet's Million Dollar Database, which lists companies with more than $1 million in revenue and at least 20 employees. Researchers were able to reach senior executives to determine the backgrounds of key founders for 2,054 of the tech startups.

Immigrants were most likely to start companies in the semiconductor, communications and software niches. They were least likely to enter the defense sector.

One of the study's biggest surprises was the extent to which Indians led the entrepreneurial pack. Of an estimated 7,300 U.S. tech startups founded by immigrants, 26 percent have Indian founders, CEOs, presidents or head researchers, the study found.

Indian immigrants founded more tech startups from 1995 to 2005 than people from the four next biggest sources — United Kingdom, China, Taiwan and Japan — combined.

"People who come from India are laser-focused on technology," said Rosen Sharma, who immigrated from India in 1993 and is now president and chief executive officer of Palo Alto-based management software company SolidCore Systems Inc. "They come here and they learn to tell a story and paint a vision. Once you have those two things, you're off to the races."

The Duke researchers also found that foreign-born inventors living in the United States without citizenship accounted for 24 percent of patent filings last year, compared with 7.3 percent in 1998.

Without permanent citizenship, inventors are more likely to take valuable intellectual property elsewhere — and U.S. companies would have to compete with them, Wadhwa said.

"The bottom line is: Why aren't these people citizens?" Wadhwa said. "We're giving away the keys to the kingdom. This is a big, big deal once you figure out what this means for U.S. competitiveness."

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[ERP_Programmer]

That’s easy;

Every politician has an agenda, Everyone’s agenda is different and no one wants to rock the boat.

It is much easier NOT to do anything then rocking the boat.

I have a good friend in Local politics and even though they really do want to make good changes to any law/process, it’s simply very hard. Follow the rules, be on top of your game and hope for the best. If not work on plan B.

Do you have a plan B?

Later

 

[GotPR?]

Do you really think $52 billion is a big number ?
Total GDP of the US in 2005 is $12,400,000 millions. $52 billion is less than 0.5% of it.
http://siteresources.worldbank.org/DATASTATISTICS/Resources/GDP.pdf

The US economy is way greater than people imagines.


Regarding start-up founded by immigrant, it is true that it produces more employment and economic activity which is good, but 99% of those eventually goes out of business and produce nothing at the end. The article seems to look at only highlight, but there is always lowlight too.

 

[Gee!See?]

The article provides some really impressive percentages - but leaves out one very critical number ...... out of the 145,000 EB immigrants per year, what is the percentage of immigrants who create these fabulous companies and add 0.5% to the US GDP ? I'm not even including the family based numbers ....

If the answer is more than 25%, then yes, the US is shooting itself in the foot. If not ....... then please put these percentages where the sun dont shine as they would mean nothing more than some clever spin.

Cheers !!

 

[hipka]

Do you really think $52 billion is a big number ?
Total GDP of the US in 2005 is $12,400,000 millions. $52 billion is less than 0.5% of it.
http://siteresources.worldbank.org/DATASTATISTICS/Resources/GDP.pdf

The US economy is way greater than people imagines.


Regarding start-up founded by immigrant, it is true that it produces more employment and economic activity which is good, but 99% of those eventually goes out of business and produce nothing at the end. The article seems to look at only highlight, but there is always lowlight too.

Economics teaches us that impact due to loss of high paying jobs ripples through the economy. So if 1000 S/W engineers making 80K return to india, then loss will be greater than 80M, as they would not consume products/services upon which other businesses operate. So by that measure, immigrant founded business generates about 1% of the GDP.

This is an unbeliveably large number. GDP refers to the whole country, so 1% lower growth equals millions of lost jobs.

We know that the size of the US economy is ~ 13 trillion and will soon be overtaken by China.

 

[GotPR?]

Economics teaches us that impact due to loss of high paying jobs ripples through the economy. So if 1000 S/W engineers making 80K return to india, then loss will be greater than 80M, as they would not consume products/services upon which other businesses operate. So by that measure, immigrant founded business generates about 1% of the GDP.

This is an unbeliveably large number. GDP refers to the whole country, so 1% lower growth equals millions of lost jobs.

We know that the size of the US economy is ~ 13 trillion and will soon be overtaken by China.

I don't think 1% is very significant. Even though the US lost 1%, the US still stands tall.
Regarding china, it is already well predicted that the US is overtaken no matter what the US will do, but other country still can not reach the US easily.

Look at the top 10 countries on GDP rank. Why is Japan at #2 position and germany at #3 position and other country even can not catch up these countries ? Japan and Germany are not immigrant friendly, but still doing good enough. So now, what makes you think the US with larger population can not do better than these countries.
If you carefully check, economy size of well developped country is pretty much proportional to their population. So the larger population is, the bigger the economy is, and fact is the US has more than 300 mil population.

 

[nyc8300]

Guys!, don't kill the message here. Smart and enterprising guys will make the country better. The research has better credibility than that on building a wall on the border for sure. In any case we will use anything that helps us build the case for WMD!, oh sorry.... SKIL Bill.

I don't think 1% is very significant. Even though the US lost 1%, the US still stands tall.
Regarding china, it is already well predicted that the US is overtaken no matter what the US will do, but other country still can not reach the US easily.

Look at the top 10 countries on GDP rank. Why is Japan at #2 position and germany at #3 position and other country even can not catch up these countries ? Japan and Germany are not immigrant friendly, but still doing good enough. So now, what makes you think the US with larger population can not do better than these countries.
If you carefully check, economy size of well developped country is pretty much proportional to their population. So the larger population is, the bigger the economy is, and fact is the US has more than 300 mil population.

 

[alterego2]

UN, Your assertion that each of us matter little to this gargantuan economy is a valid one. Yet the notion that the USA is currently not facing a shortage of the skills that are currently in large part driving economic expanion is false.

Collectively a good workforce that possesses these skills is an imperative fro this country to maintain its leadership position in the world economy. If these skills can be nurtured locally, well and good and noone should have an argument against it. Yet if they cannot, and currently the signs are that it can't, then the country can't afford to sit and watch either. Whether the protectionist masses realise this or not is another matter. The reasons for this workforce shift also need consideration. Today in the US, a lot of fields like Law, Real estate, Sales/Marketing pay very well compared to the rather hard work/skills that are involved in the sciences. As such many of the "best and brightest" of this land are going in such directions.
Conversely, In india and much of the developing world the situation is in reverse, and the afore mentioned fields pay poorly or aren't even developed well, and sectors such as IT etc are paid very well per local standards.
This along with huge pay and currency valuation differences creates clear arbitrage opportunities.

However all of this does not imply that any of us are indispensable, or conversely that collectively our services are not in demand here. The system of workforce flows however needs more efficient management.

 

[nyc8300]

Playoffs tonight!

Guys relax!
Playoffs start tonight. Drop this endless argument and try and make a million dollars, slap it on USCIS and get your GC. I don't know if anybody would want to get a GC and be paying 35% of your money after getting a million though. Why not live in Dubai with no taxes??

The only thing making people live in US vs. Dubai vs. India is the way of life in each of these places. So if you like living here, you will be watching the playoffs rather than talking immigration.

 

[envision]

I agree people need to relax Of course no one should enjoy living in limbo, but there comes a time to get away from it all. Let's stop allowing the process to consume all our thoughts

 

[alterego2]

Yes, there is contribution. Isn't the argument by us that they should make it more friendly and easier and there is impact by us to economy and companies?

I don't think you will get counter argument to the above.

However; if there was an attack by restrictionists that they should curb immigration (get rid of it all together or severely curtail # of h-1b's or greencards) and there was some momentum on their side then I can tell you I wouldn't be sitting here pointing these things out. I would be the first one trying to develop studies to counter it.

However, we are trying to get it raised and get more people here and keep them here. Shouldn't the argument be what is the "incremental impact" of increasing h-1b and/or raising quota? Obviously to make predictions of future you need to consider past and current to do so.

I'm just curious as to how come there wasn't more of an outcry when h-1b quota went back to old limits. We missed the boat on this one as that is where we should have spent our energy as those people are not currently in USA. Those of us in retrogression are already here contributing so there is less argument of increasing greencard quota because other then goodwill to us; there isn't any major impact to economy.

Perhaps an annual quota of 195K in the era of a burst internet bubble was too much and 65K in the era of a booming economy was too small. After all H1b skilled workers are particularly relevant to the IT/Healthcare industries. Such visas in other fields are not common enough to influence the labour market in any tangible way.
However these numbers annually can influence the slack in the job markets in these areas which also happen to be what is driving the current economic expansion.

Current proposals call for a relatively modest increase of H1b to 110K visas annually. Corporate america knows that H1b is the road to permanent residence in this land for this category of workers and does not realistically expect them to leave. Hence most legislation for H1b increase tends to be accompanied by some sort of EB visa relief. If substantial numbers of these people were forced to leave, then the H1b quota required would be vastly more annually (since H1b extensions exceed new issuances annually). The greater point is these job skills anchor more jobs in this land and fuel expansion. Pretending like this is not the case is not sound public policy.

It flys in the face of this country's founding principles and even in its enlightened self interest to push out these relatively skilled,law abiding,culturally and linguistically adaptible individuals, especially given their demonstrated ability to functionally assimilate into society after 6-8yrs here or even to make their migration here a state of eternal suspension. This has less to do with goodwill alone for us in my view.

 

[tusharvk]

to your point 6, one could say that money in nri accounts going to India is fueling demand for US consumer products by increasing the purchasing power of the growing middle class in India.

I think there may not be found a completely valid argument to increase the GC quota; but the study and its results need spinning to show that there is temporary need for this. much like what had happened when raising h1b quota temporarily.

EB2 and EB3 In and CHi are retrogressed for over a year now. Somebody filing labor in these categories with perm has potentially such a long wait without some legislative relief.

If ROW could provide the skills required by employers, there would be retrogression in EB2 row. For this reason, I do not think the employers are just going to continue with their wait and watch approach.

Hipka, I was thinking about this a little more last night.

Sixth - How much money is sitting in NRI accounts that has been shifted to indian economy away from US economy? How much of the NRI accounts are of h-1b holders, permanent residents, us citizens. Is it only H-1b's? and they are sitting on the fence and as soon as they get permanent residency, they will keep the money in USA?

Seventh - Many of the people who come to USA on H-1b are entry level or very early in their careers. What is impact to company, economy for the training, lost productivity to the company while someone is getting upto speed.

Eighth - How much services do newly found immigrants use which they haven't paid to in the past (school system - if a us citizen/permanent resident has been living in a city they would have been contributing many years to these taxes before they would take the benefit whereas people who land here would start using them right away.

Ninth - For people who will leave the US will those jobs automatically shift to where they are headed? If a person leaves a company that was sponsoring them for the greencard but goes to another company then what was economic impact to the company to whom you left? Did they delete the position; if they did then they shouldn't have sponsored you in the first place; if they filled the position was it by a US citizen/permanent resident? If it did then why couldnt' they find them earlier?

Tenth - How many people have left USA because of the current long delays?

Eleventh - How many people have left USA who have greencard or currently live outside usa with greencard?

__________________________________________________

#10 and #11 is your argument. You wouldn't be able to get the data and if you did, you would see there is no correlation between retrogression, outsourcing and people leaving.


---------------------------------------------------------------

These types of press releases are good because it is a slow/little drip to remind the average american that there is contribution and they should have interest in it. However, if you want to take a critical look (which the average american doesn't know or care to know; then you will find issues with what I have earlier mentioned).

-------------------------------------------------------------------


I want to make it clear that I would like the doors to be completely open. The process of getting foreigners should follow normal business practices. Match a company with a willing worker. It should be streamlined, there shoulnd't be any quotas if the true purpose of skilled base employment is to attract/retain talent that companies cannot get here or develop.

 

[indian_gc_ocean]

Actually, I was wondering if this is really consuming everyones thoughts or is it just confined to a few people.

I talk/discuss with a lot of people and I find a lot of apathy towards this. If you tell people it may take 3 to 4 years to get the greencard; it doesn't seem like they are overly concerned with it.

It seems the attitude is; I am on h-1b, making good money and I'll live life the way I want to and when it comes it comes.

I am afraid your are discussing with wrong sample who may be less ambitious and for whom being in the US itself is a great feeling. There are many others who would want to change jobs easily, make more money, move better in their career. Situation in India and US is lot different than what it was during late nineties.

It is also possible that the same very sample is driving you towards more unrealistic generalizations sometimes.

 

[GC_TRAP]

My half-a-penny on the matter!

While I agree that the subject being discussed here is broad and worthy of analysis, I disagree with the "topic" title of this thread.

The title seems less than cordial and appears to put "UN" in a less-than-favorable light. Regardless of one's position on the issue, the subject matter is not a clear black-and-white situation but many shades of grey.

Maybe the original poster wanted to capture attention to elicit responses from others in this thread, without meaning to disparage UN's reputation.

The debate should continue, albeit a more fact-based and less opinion-based debate will continue to evince more interest from the sidelines, both in watching and/or participation.

 

[nyc8300]

UN,
The gap between the US and other economies has changed a lot. The change is not only in terms of the actual living standards but in terms of people's perception of future growth/opportunities.
I was reading some stats about movement of IIT students from India to the US. Last year, less than 5% of IIT students came to the US to work/study compared to over 30% to 40% in the late 90's and early 00's.
We also see the change in outsourcing, corporations setting both production and research facilities outside the country.

I think the H-1b people you talk to are not overly concerned because they see this shift in the economies and do not care about GC etc. I don't think the US is the first choice for the brightest right now.

Actually, I was wondering if this is really consuming everyones thoughts or is it just confined to a few people.

I talk/discuss with a lot of people and I find a lot of apathy towards this. If you tell people it may take 3 to 4 years to get the greencard; it doesn't seem like they are overly concerned with it.

It seems the attitude is; I am on h-1b, making good money and I'll live life the way I want to and when it comes it comes.

 

[GreenCardVirus]

UN,
I was reading some stats about movement of IIT students from India to the US. Last year, less than 5% of IIT students came to the US to work/study compared to over 30% to 40% in the late 90's and early 00's.

Somehow it irks me when people discuss IITs. IITs are good but people and media grossly overrate them.

Why do people always use IIT grads as a defacto standard to figure how many people are leaving India and how many are not?

IITians are successful but are there any numbers on people from other colleges that are successful? I guess not.

 

[indian_gc_ocean]

You need to give examples of item in blue.
....................

Well, you can go through your own postings in Yahoo! News thread, or IV becoming desperate thread, Real estate bubble and other threads. Obviously, you are not finding anything wrong with them and that is absolutely fine. At certain points you yourself quoted saying you only deal with consultants who make on a average about 50k anually.

Anyway, one of your generalizations about H1 is below
http://www.immigrationportal.com/showpost.php?p=1549233&postcount=51

If you know only one kind of H1s better stop talking about them in general.

About people being desprate about immigration, I am least bothered about my status and I am not on H1 and I work in one top ten IT majors in US drawing happy salary but when I see postings with prejudices, I cannot help myself taking off my time to respond to them.

I saw one your posting where you mentioned that you are current now for some time may be you can do the same immigration desperation self analysis.

 

[nyc8300]

The move/change outsourcing is no longer only IT related but Research, finance/investments, production etc. We are seeing a mass movement of all manufacturing units out of the US. The move in research and finance/investments is happening now and is no longer a cost cutting
deal.
We are seeing a shift in competitiveness of nations and this is going to affect not just Indians in IT in the US and India but future investments.
This is no longer just about IT people in India and the US and the GC process

The US offers safety of investment and hence gets financed by China and Japan to a huge extent. Hate to say this but that perception can change
very quickly.

From everything I am reading; it definitely seems that there may be less people coming to USA as the opportunities will reside in person's home country. This is probably a win/win situation for American companies but don't know if it is a win/win situation for IT people here in USA.

Starter of this thread opened a new thread regarding cisco and transferring executives to India and the ambitious plans they have in India. Good for IT people in India but perhaps bad for IT people here in USA.

As one can conclude from that article. IT offshoring has nothing to do with retrogression. Whether they open up the floodgages or not; us companies will continue to set up operations in India due to the abundance of labor pool and cost effectiveness.

Maybe American companies are taking a page from TCS, Wipro and Satyam. That is; if they have a project manager here in USA controlling the work of people in India then maybe we should do the same thing. Good for India maybe not so good for Indians in USA.

 

[GreenCardVirus]

Maybe American companies are taking a page from TCS, Wipro and Satyam. That is; if they have a project manager here in USA controlling the work of people in India then maybe we should do the same thing. Good for India maybe not so good for Indians in USA.

Not really.

Example 1: Where I live, Boeing employs lot of Indian techies as employees and contractors. India was the biggest customer of Boeing last couple of years in terms of the number of orders placed. Now boeing is hiring even more people.

Example 2. The company I work for specializes in retailing software. Last 2 quarters, the only reasonable sales for our company were from India. Our company has a direct office in India and also does oursourcing. Our complany still keeps hiring in US.

 

[GotPR?]

Somehow it irks me when people discuss IITs. IITs are good but people and media grossly overrate them.

Why do people always use IIT grads as a defacto standard to figure how many people are leaving India and how many are not?

IITians are successful but are there any numbers on people from other colleges that are successful? I guess not.

I agree.
The change of attitude of IIT student won't give solid ground to claim the US will lose talent.
Those who bring up IIT thing do not realize that there are a lot of immigrants from other countries too. Nowaday, Indian make a big percentage of H1 holders, but if some of IIT students decided not to come, that position might be filled by brilliant someone from other countries.