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Greener grass in China and India lures returnees
July 6, 2011, Wednesday
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IN 1980, immigrant entrepreneur Vivek Wadhwa came to the United States and stayed, starting two companies that created more than a thousand American jobs.
Now an academic, Wadhwa sees first hand that today's immigrants are not following his lead. Every year he asks foreign students in his classes at Duke University how many intend to stay permanently in the US. "It used to be that everyone raised their hand," Wadhwa says. "Now they look at you funny. They say, 'What does that mean'?"
For a majority of highly skilled immigrants who want to start companies, the promised land is no longer the US, writes Wadhwa and four co-authors in a recent report from the Kauffman Foundation, a Kansas City, Missouri-based non-profit that supports research on entrepreneurship.
In "The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs," the researchers surveyed 153 professionals who returned from the US to India or China to start a business. They found that 72 percent of Indians and 81 percent of Chinese said the opportunities to start a company in their home countries "were better or much better" than in the US.
Some say the flow of immigrants back home is a "brain drain" for the US that calls for an immigration policy overhaul. Sending would-be entrepreneurs packing robs the US of new companies, new jobs and long-term economic growth, they argue. Others say the pull is as strong as the push: that as economies blossom in China and India, the opportunities sprouting on native turf are simply too tempting to resist.
Some experts maintain that returning immigrants don't actually spell a net loss for the US anyway. They see the flow as more of a "brain circulation" that benefits economies on both sides of the sea.
Wadhwa, a senior research associate at Harvard Law School and director of research at Duke's Center for Entrepreneurship and Research Commercialization, falls on the "brain drain" end of the spectrum.
Brain hemorrhage
"It's not a brain drain; it's a brain hemorrhage," he insists. He sees the flow as a policy problem, the result of a visa system that broke down after 9/11 and the dot-com bust, stymying more than half a million skilled immigrants. Would-be entrepreneurs now wait years in "green card limbo," stuck in jobs tied to H-1B visas that allow neither transfer nor promotion, Wadhwa notes.
It's a world away from three decades ago, when Wadhwa immigrated from India. "It took me 18 months to get a green card," he recalls. He started his first company 15 years later - and wasn't alone.
Immigrants would continue to start companies in the US if given a better chance, Wadhwa argues. He believes the StartUp Visa Act, a proposal in Congress that would give visas to immigrants who have enough venture capital backing to start a business, would "unleash a flood of entrepreneurship."
Although less than 10 percent of respondents in the Kauffman report said visas played a "very important" role in their decision to return home, Wadhwa is skeptical about those responses. "People are saying they are going back because of economic opportunities, but the truth is that we're not giving them a chance to grow deep roots."
One of Wadhwa's co-authors, AnnaLee Saxenian, a dean and professor in the School of Information at the University of California, Berkley, says: "... the challenges of getting visas, the suspicion of foreigners in the US since 9/11 and the severity of the economic downturn have all served as 'push' factors ..."
(Adapted from an article from China Knowledge@Wharton, http://www.knowledgeatwharton.com.cn. To read the original, please visit: http://bit.ly/mk2n9D)
Now an academic, Wadhwa sees first hand that today's immigrants are not following his lead. Every year he asks foreign students in his classes at Duke University how many intend to stay permanently in the US. "It used to be that everyone raised their hand," Wadhwa says. "Now they look at you funny. They say, 'What does that mean'?"
For a majority of highly skilled immigrants who want to start companies, the promised land is no longer the US, writes Wadhwa and four co-authors in a recent report from the Kauffman Foundation, a Kansas City, Missouri-based non-profit that supports research on entrepreneurship.
In "The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs," the researchers surveyed 153 professionals who returned from the US to India or China to start a business. They found that 72 percent of Indians and 81 percent of Chinese said the opportunities to start a company in their home countries "were better or much better" than in the US.
Some say the flow of immigrants back home is a "brain drain" for the US that calls for an immigration policy overhaul. Sending would-be entrepreneurs packing robs the US of new companies, new jobs and long-term economic growth, they argue. Others say the pull is as strong as the push: that as economies blossom in China and India, the opportunities sprouting on native turf are simply too tempting to resist.
Some experts maintain that returning immigrants don't actually spell a net loss for the US anyway. They see the flow as more of a "brain circulation" that benefits economies on both sides of the sea.
Wadhwa, a senior research associate at Harvard Law School and director of research at Duke's Center for Entrepreneurship and Research Commercialization, falls on the "brain drain" end of the spectrum.
Brain hemorrhage
"It's not a brain drain; it's a brain hemorrhage," he insists. He sees the flow as a policy problem, the result of a visa system that broke down after 9/11 and the dot-com bust, stymying more than half a million skilled immigrants. Would-be entrepreneurs now wait years in "green card limbo," stuck in jobs tied to H-1B visas that allow neither transfer nor promotion, Wadhwa notes.
It's a world away from three decades ago, when Wadhwa immigrated from India. "It took me 18 months to get a green card," he recalls. He started his first company 15 years later - and wasn't alone.
Immigrants would continue to start companies in the US if given a better chance, Wadhwa argues. He believes the StartUp Visa Act, a proposal in Congress that would give visas to immigrants who have enough venture capital backing to start a business, would "unleash a flood of entrepreneurship."
Although less than 10 percent of respondents in the Kauffman report said visas played a "very important" role in their decision to return home, Wadhwa is skeptical about those responses. "People are saying they are going back because of economic opportunities, but the truth is that we're not giving them a chance to grow deep roots."
One of Wadhwa's co-authors, AnnaLee Saxenian, a dean and professor in the School of Information at the University of California, Berkley, says: "... the challenges of getting visas, the suspicion of foreigners in the US since 9/11 and the severity of the economic downturn have all served as 'push' factors ..."
(Adapted from an article from China Knowledge@Wharton, http://www.knowledgeatwharton.com.cn. To read the original, please visit: http://bit.ly/mk2n9D)
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