A conversation about the importance of immigration on entrepreneurship with Ali Noorani, President and CEO of the National Immigration Forum
Immigration has been at the forefront of conversations these days. What is often lost in this discussion is how immigrant-owned businesses benefit the US economy. In fact, immigrant-owned businesses employ 8 million workers and generate over $ 1 trillion in sales.
Their success is visible in both Fortune 500 companies and small businesses. Sadly, immigrant small business owners have been hit hard by the Covid-19 pandemic, as a National Bureau of Economic Research study found that a third had reported significant losses. This is compounded by the fact that many homeowners are unsure of their eligibility for government assistance programs.
As President and CEO of the National Immigration Forum, Ali Noorani leads an advocacy organization that works with faith, law enforcement and business leaders to promote the value of immigrants and the immigration to the United States. A second-generation American, Ali grew up in California as the son of Pakistan-born parents and is the author of “There Goes the Neighborhood: How Communities Overcome Prejudice and Meet the Challenge of American Immigration” and host of the podcast “Only in America”.
I recently reached out to Ali to discuss the impact of Covid-19 on immigrant business owners, ways lawmakers can support them, and steps they can take to keep their businesses viable during this. period. I am grateful to Ali for taking the time to talk to me; below is a summary of our conversation.
Rhett Buttle: Can you describe the impact of immigrant-owned businesses on job creation in the United States?
Ali Noorani: The impact is, in a nutshell, enormous. In 2017, more than 3.2 million immigrants ran their own businesses and employed nearly 8 million U.S. workers, generating total sales of $ 1.3 trillion. By this measure alone, it is quite clear that immigrants and immigration are of great benefit to the nation.
As a percentage, immigrants are more likely to start businesses than US citizens. Yes, immigrants make up over 40% of Fortune 500 company founders, but they are also heavily represented in Main Street companies. I think most of us have first hand experience with this – it’s businesses like restaurants, grocery stores, gas stations, and dry cleaners. Immigrant-owned businesses are the fuel of the US economy.
Butt: How are immigrant-owned businesses affected by the Covid-19 pandemic?
Noorani: The impacts of Covid-19 have been significant. According to a study by the National Bureau of Economic Research, more than a third of immigrant business owners reported “substantial losses in business activity.” Only African-American business leaders reported such losses at a higher rate (41%).
Immigrant-owned businesses are heavily represented in some of the sectors most affected by Covid-19, such as transportation, restaurants and hospitality. Since many businesses are located in communities disproportionately affected by Covid-19, those that have been able to stay open may have seen a drastic drop in demand for their services or products.
Butt: What is the effective support provided to immigrant-owned businesses by policy makers and other leaders (eg, business, philanthropy)? What else should they be doing to help?
Noorani: There is no federal program created in response to Covid-19 that is only for immigrant-owned businesses. Many immigrant-owned businesses may be eligible for general Covid-19 economic relief programs for businesses, such as the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL). However, eligibility does not guarantee equal access and does not guarantee that funding will be available under these federal programs.
Unfortunately, there is significant ambiguity about the eligibility of immigrant businesses and how the government weights eligibility, both of which have limited the number of immigrant businesses that receive assistance. In addition, in the first wave of PPP loans, immigrant businesses that did business with smaller community banks were at a disadvantage in being able to obtain PPP loans, compared to larger businesses.
A June survey of Latin American small business owners (immigrants and non-immigrants) found that 71% of respondents had not asked for government help. Of these respondents, almost 20% thought they might be eligible but needed help filling out the forms. Language barriers and technological illiteracy are among the factors that can make online applications for P3s and other business loans or grants difficult for many immigrant-owned businesses to access.
A unique barrier to immigrants is that they may be reluctant to access available resources lest it affect their long-term immigration and naturalization prospects. The litany of changes in immigration policy made by the Trump administration has made a system that many find more complicated than our tax code, even more convoluted.
Government officials should make it clear whether and under what circumstances immigrant businesses are eligible for aid programs – federal, state or local. Addressing language and digital barriers would also be helpful. More concretely, it would also be very beneficial to simplify the PPP remittance process and make the remittance automatic for loans up to a certain amount.
Private companies, foundations and other philanthropic organizations are also starting to help businesses alleviate Covid-19. However, their contributions are difficult to fully grasp as they represent such a diverse support sector and often target specific geographic locations. Given the estimated overall reduction in the number of business owners of around 3.3 million, the impact of such assistance will most likely be limited to businesses, including immigrant businesses, that have the contacts or capacity to know what help is available.
But there are a few possibilities. The Boston Foundation has made nearly $ 1 million available to Greater Boston nonprofits that provide vital support to communities, including nonprofits that work with immigrants. Google has committed $ 175 million to black-owned businesses. Magic Johnson Enterprises targets minority and women-owned businesses with a commitment of $ 100 million. PayPal and the Association for Enterprise Opportunity are targeting black-owned businesses with a $ 10 million fund.
Butt: What are the top things immigrant small business owners need to think about and do to keep their business viable in these uncertain times?
Noorani: To begin with, small business owners need to know what federal, state and local public and private resources are available to help them in these unprecedented times. They need to better understand not only what resources are available, but also which are not, and how to secure the available resources to maintain their operations.
Immigrant business owners should keep abreast of the latest health precautions they need to take for their workers and customers and ensure their employees have the necessary personal protective equipment and have a safe working environment. These precautions can help protect the health of their employees and customers and guard against legal liabilities.
But the response and recovery to Covid-19 does not depend solely on the immigrant business owner. Local chambers of commerce, Rotary clubs, banks and other civic institutions should redouble their efforts to involve immigrant business owners. We all have stories of business districts revitalized by immigrant entrepreneurs. Therefore, it will take all of us to support these business owners and ensure that main streets across America continue to thrive.
Butt: What resources can help business owners during this time?
Noorani: In terms of existing resources, public resources are available at the federal, state and local levels, and some private resources are also available. Immigrant business owners should seek information from organizations and agencies focused on issues relevant to small businesses. For example, the Small Business Administration and other business associations have useful information on their websites about resources available to assist with the economic recovery from Covid-19.
In light of the continuing nature of the pandemic, immigrant business owners would also do well to examine what components of their business model can be done virtually and invest in the technology to make this possible.
Additional resources that would benefit immigrant business owners include support services with native speakers available and technical assistance in completing the necessary paperwork to secure funding opportunities.
Don’t miss my previous conversations with Ron busby, CEO of US Black Chambers, Inc., Ramiro cavazos, President and CEO of the Hispanic Chamber of Commerce of the United States, Cooling clamp, President and CEO of the Asia / Pacific American Chamber of Commerce and Entrepreneurship, Jen earle, National CEO of the National Association of Women Entrepreneurs, and Jill houghton, President and CEO of Disability: IN.