The Real Immigration Problem in the U.S.

December 9th, 2012

Photo by: takomabibelot | Flickr.com

The United States is letting one of its most valuable resources slip through its borders: highly skilled immigrants. And rather than fighting to hold on to the people who could help turn the economy around, the current trend in immigration policy is rather misguided.

While undocumented immigration has long been a contentious issue in the United States, not enough attention is paid to business immigration. And business immigration could be the key to turning the U.S. economy around.

In recent years, more and more Indian and Chinese students have been coming to the U.S. to pursue higher education. But rather than staying to join the workforce in the U.S., they are then returning home to seek employment. And, following suit, the number of high-tech startups started by immigrants to Silicon Valley from those countries has dropped by 8% over the past seven years. That represents a significant loss of capital and opportunity that is only compounded by the fact that these skilled individuals are taking their ideas overseas.

And the ingenuity that immigrants bring to the nation is undeniable. A study by researcher Vivek Wadhwa, author of The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial Talent, found that 25% of U.S. all patent applications filed in 2006 listed foreign nationals living in the U.S. as inventors or co-inventors. In addition, a quarter of American science and technology companies founded between 1995 and 2005, which employed 450,000 employees, had a foreign-born lead technologist or chief economist.

Another study, Then and Now: America’s New Entrepreneurs, Part VII, co-authored by Vivek Wadhwa, Francis Daniel Siciliano II, and AnnaLee Saxinean concludes that the period of unprecedented expansion of immigrant-led entrepreneurship that characterized the 1980s and 1990s has come to a close. Today, the growth rate of immigrant-founded companies nationwide, at 24.3 percent, has plateaued. In the high-tech hub of Silicon Valley, the proportion of immigrant-founded companies has dropped from 52.4 percent during 1995-2005 to 43.9 percent during 2006-2012.

Immigrant founders of engineering and technology companies have employed roughly 560,000 workers and generated an estimated $63 billion dollars in sales during this time. While the rate of growth of immigrant entrepreneurship has stagnated, these numbers nonetheless underscore the continuing importance of high-skilled immigrants to the maintenance and expansion of the national economy. These findings are interestingly complex, since the two major skilled-immigrant groups — Indian and Chinese — are starting companies at higher rates than they did previously. Historically and today, the United States continues to benefit directly from the contributions of such immigrants. Far from expendable, high-skilled immigrants will remain a critical asset for maintaining U.S. competitiveness in the global economy.

A copy of this paper can be downloaded at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2159875

 

What is the Solution?

An article by Charles Kenny in Bloomberg Businessweek has a few creative suggestions. First, he proposes the U.S. remove its current caps on H-1B visas. These 85,000 visas, which are released on a first-come, first-served basis at the beginning of April every year, allow American companies to employ foreign workers in specialty occupations, including fields such as engineering and mathematics, without granting them the status of a legal immigrant.

He also finds fault in the EB-5 program, which was instituted in 1990 and gives visas to those who invest at least $500,000 and create 10 jobs. The specifics of the program led to only 3,127 people (just under 23% of all applicants) being approved in the first 10 years of its implementation.

As far as new legislation on immigration goes, Kenny is in support of passing the DREAM Act and the Schumer-Lee Bill, which would grant residency to anyone spending over $500,000 on a house, as well as giving green cards to graduate students in U.S. universities.

All in all, the U.S. needs to do something to fix its current problem with immigration. And the solution is not to keep all immigrants out—it is to strategically let them in. For more information on business immigration law, consult Zulkie Partners LLC.

http://www.businessweek.com/printer/articles/78202-why-more-immigration-not-less-is-key-to-u-dot-s-dot-economic-growth

Comment » | H-1B, Immigration reform

The Papers Please Policy in Arizona

November 9th, 2012

photo by: Nevele Otseog | Flickr.com

With the recent allowance of police offers to enforce the papers please policy in the Arizona anti-illegal immigration law, the Support Our Law Enforcement and Safe Neighborhoods Act (SB 1070), any person who is stopped, detained, or arrested for any reason is subject to have their immigration status checked if the officer has a reasonable suspicion that the person is in the United States illegally. The consequences of this policy reach far beyond a simple inconvenience for Arizona residents—it is also significantly damaging the state’s economy.
Arizona’s Unfavorable History of Harsh Immigration Policies

Since 2007, Arizona has been implementing strict laws meant to rid the state of illegal immigrants. The Legal Arizona Workers Act (LAWA) utilizes an electronic employment verification system called E-Verify that costs $147 and additional human resources to verify a single employee. The threat of losing everything for knowingly or unknowingly hiring illegal workers lead entrepreneurs to start their businesses elsewhere and earned the system the nickname of “the business death penalty.” The business formation rate then declined 14.3% in the third quarter of 2007 as unemployment rose. Workers found to be illegal were fired from their jobs, but legal Americans did not seem to step up to fill them. Not surprisingly, as crop production employment in Arizona fell by 15.6% in the four years following the enactment of LAWA, employment in the same category increased in nearby New Mexico and California.

Bad Signs for the Economy

In addition to the poor employment figures, another indication that Arizona’s laws have hurt their economy can be seen in Phoenix’s home price index. While the index for the 20 largest metropolitan areas declined by 32.9% in light of the housing bust, Phoenix’s price index dropped by a staggering 51.29%.

SB 1070 then took Arizona’s severe anti-immigration policies out of businesses and into the streets, and Forbes estimates that a total of around 200,000 people have been forced out of Arizona as a result of the two laws. Those are 200,000 lost consumers who would have continued to inject money into the economy.

Business Immigration Would Help

As evidenced by the detrimental effects that Arizona’s anti-immigration laws have had on their economy, the solution to the United States’ immigration problems is not to unabashedly evict illegal immigrants, especially those who are working and helping our economy. America was built on immigration, and it would not behoove the nation to turn its back on industrious workers now.

Zulkie Partners LLC specializes in all aspects business immigration law, including permanent resident sponsorship, nonimmigrant working visas, and retention of permanent residence status for employees facing a foreign business assignment. For more information, education, and help regarding immigration law, contact Zulkie Partners LLC, one of America’s top business immigration law firms.

http://www.forbes.com/sites/alexnowrasteh/2012/10/12/arizona-style-immigration-laws-hurt-the-economy/2/

Comment » | Immigration reform

CBP Plans to Discontinue I-94s, No Longer Stamping I-20/DS-2019 Documents

October 19th, 2012

U.S. Customs and Border Protection (CBP) is in the process of automating traveler arrival/departure records and will be eliminating at international airports and seaports the paper version of Form I-94, the white card placed in most foreign nationals’ passports that denotes the date of their admission as well as their status and authorized period of stay.  Instead, the traveler will receive a stamp in their passport with a handwritten code of admission (such as H-1B or O-1) and period of admission. Under the plan, nonimmigrants arriving at land borders, and certain classes of arriving foreign travelers, such as refugees, will continue to be issued a paper Form I-94.

The reasons for eliminating the I-94 paper form are two-fold: (1) CBP already has access to the information gathered on the I-94 through the foreign national’s application for a nonimmigrant visa and the Web-based Advance Passenger Information System (APIS); and (2) eliminating Form I-94 will save the agency money and resources.

Since first announcing its plans to implement a paperless I-94, CBP has received concerns from federal and state agencies about the impact on their programs that use the document for an identifier. For example, what will state DMVs require? And, what will the Social Security Administration require for SSNs? CBP also has not yet fine-tuned an online systems query capability that must be in place before the paper record is eliminated.  While implementation of the paperless I-94 is still some months away, it is clearly on the horizon.

Meanwhile, CBP has already implemented another change for certain arriving nonimmigrant visa holders. CBP officials are no longer stamping prospective or returning foreign students’ Form I-20s and exchange visitors’ DS-2019s at ports of entry. Instead, CBP is using an electronic system to adjudicate the individual’s status notation. The stamping of the Form I-20 / DS-2019 had been a longstanding USCIS procedure, and thus USCIS is apparently reaching out to other agencies to inform them of the change, since many agencies require these stamps prior to granting benefits.

 

Comment » | Customs and Border Protection

Applicants Under Age 14 or Over Age 79 Do Not Need to Appear for Biometrics for Reentry Permit (or Refugee Travel Document)

October 19th, 2012

When a lawful permanent resident plans to depart the U.S. temporarily and does not expect to return to the United States for a year, often he or she is advised to obtain (before departing the U.S.) a Reentry Permit. A Reentry Permit is a travel document that helps to protect an individual from inadvertently abandoning permanent resident status. To obtain the Reentry Permit travel document, the individual must apply while in the U.S. and obtain biometrics (fingerprints and a digital photograph) prior to departing the U.S. Once the biometrics have been taken, the individual can leave the U.S. and the travel document can be mailed to him or her abroad.  The rules regarding fingerprints and photographs have been confusing for those under age 14 or over 79 because these individuals are not required to pay a biometrics fee or have their fingerprints taken. They are, however, being notified by USCIS that they are to appear at application support centers for biometrics. Just recently, however, USCIS has advised that such individuals are not required to attend a biometrics appointment. Instead, applicants under the age of 14 or over 79 can submit two passport-style photographs when applying for the Reentry Permit (in addition to all other required documentation), and USCIS will issue the travel document without requiring the applicant to attend an appointment.

Comment » | Department of Homeland Security, Lawful permanent resident

IRS Now Requiring Original Documentation for ITINs; Certain Nonresident Foreign Nationals Exempted

October 19th, 2012

From now until the end of the year, the IRS will no longer accept notarized or other copies of documentation (such as passports and birth certificates) for issuing individual tax identification numbers (ITINs) in an effort to “to strengthen and protect the integrity of the ITIN process while minimizing the impact on taxpayers.” During this interim period, people who need ITINs can do so by submitting original documentation (or certified copies by the issuing agency) by mail or at IRS walk-in sites. The IRS specifically states that apostille documents will not be accepted. The new rules specifically exempt military personnel and their families, as well as “nonresident aliens” who are applying for ITINs for the purpose of claiming tax treaty benefits or who are subject to third-party withholding for various income (such as certain gaming winnings or pension income, or otherwise need an ITIN for information reporting purposes). The IRS advises that while existing documentation standards will be maintained for these applicants, scrutiny of the documents will be heightened. ITIN applications by nonresident aliens that are accompanied by a U.S. tax return will, however, be subject to these new interim document standards. The IRS advises that it will return original documents within 60 days.

Comment » | Taxation

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