Immigrant Entrepreneurs: Overview

Entrepreneurship
The Small Business Administration (SBA) considers any company with fewer than 500 employees to be a small business. In 1998, approximately 98% of the 275,200 companies who hire employees in the United States were small businesses. (Sole proprietorships, those with a single operator, were not even included in this statistic.) Not only has the number of all small businesses increased, but woman- and minority-owned firms have risen dramatically in recent years. Between 1987 and 1992, black-owned businesses increased 46.5%; Asian-, Native American-, and Pacific Islander-owned businesses increased 60.7%; and Hispanic-owned buisnesses increased 82.9% (Office of Advocacy, U.S. Small Business Administration, 1998). Clearly, entrepreneurship offers important economic opportunities to non-white individuals and immigrants.

The United States provides open access to capital that attracts and supports energetic entrepreneurs. For example, this drive has resulted in 22 foreign-born business owners on The Forbes 400 in 1998 (Brenner, 1998). Fursash in the Journal of Commercial Lending asserts that contemporary immigrants tend to maintain their ethnic and cultural identities which enhances the marketplace by creating new product challenges: "As in the past, [immigrants] will still be the backbone of new small business" (Fursash, 1995).

Light and Rosenstein not only agree with this idea, they challenge that "existing entreprenuership theory is elitist" and "bankrupt" and focuses on alleged innovations and capitalist success stories. They prefer a view of entrepreneurship that honors the small innovations and stamina necessary for even the tiniest storefront to provide a livelihood for a family. According to their exhaustive study of self-employment statistics, the foreign-born have had higher non-farm self-employment than native-born Americans for more than 100 years. Immigration and other economic policies hinder the potential growth these statistics imply. Significant policy changes should be implemented that would expand entrepreneurship and offer solutions to reduce crime and alleviate poverty (Light and Rosenstein, 1995).

Immigration
Since it's birth, the United States considered itself a nation of immigrants (granted, to the great detriment of the original native Americans). The emerging country has depended on the influx of immigrants to support and create economic growth for four centuries. This situation is complicated by what Lacey refers to as the triangle of confusion in American attitudes as people struggle with this tradition of America as an immigrant nation, with restrictions or allowances in contemporary U.S. immigration policies, and with U.S. worforce needs.

Lacey asserts that the confusion is acerbated by immigrant rivalries and different ethnic groups competing for resources (based on scarcity or perceived scarcity). In his chapter, "A Brief History of American Immigrant Rivalries," he provides a narrative overview of mass immigration to the U.S. and related government policies. (See Immigration Timeline.) For example, during the Great Migration at the turn of the 20th century, a mild economic depression and growing labor movements looked for ways to guarantee rights and jobs for workers. Some of these efforts provided the environment that produced the Johnson-Reed Act, or National Origins Act, in 1924 that imposed annual ethnic quotas on immigrants (based on 25-year-old U.S. population statistics). The act was fully operational by 1929 and, Lacey maintains, contributed to the severity of the Great Depression by drastically narrowing the influx of new ideas and laborers (Lacey, 1990).

Conversely, Borjas believes that the net gain of mass immigration is too small to accept as a viable strategy for continued economic and social health for the U.S. He thinks that the U.S. benefits from the "brain drain" of other countries and warns that the Canadian point system of ranking potential immigrants is necessary. Only by admitting the best and the brightest can this country avoid the disaster of lower job skills and poor economic conditions of this Second Mass Immigration which resulted in a redistribution of visas from advanced, industrialized countries (e.g., European) to developing countries (e.g., Latin America) (Borjas, 1999, Immigration and Naturalization Service, 1999).

Much of the literature examines what kinds of restrictions should be placed on immigration policy. Sometimes the finer points of the discussion become mired in the paradox that Schuck identifies: "Americans like immigrants more than immigration" (Schuck, 1998). Separating feelings about individuals and their accomplishments from abstract principles is difficult. Even Borjas admits that his own family probably would not have qualified for entry into the U.S. if his point system were in place (Borjas, 1999).

Ethnic Entrepreneurship
Research about ethnic entrepreneurs has shown that immigrants share many of the same problems when they start a business. And many contribute to the success of the community at large when they succeed (Waldinger et al., 1990; Light and Rosenstein, 1995; Light, 1996; Brenner, 1998). Even business writers are recognizing the correlation between the Second Great Migration in the past twenty years and the economic success the U.S. currently enjoys. They are identifying additional opportunities and calling for expanding opportunities for these new entrepreneurs (Wulff, 1992; Fursash, 1995; Light and Rosenstein, 1995; Light, 1996; Brenner, 1998).

Immigrant entrepreneurs face many challenges in adapting to the host culture and building a successful enterprise. Waldinger et al. describe seven problems ethnic business owners commonly face:

These entrepreneurs may use support systems within their ethnic enclave communities—such as folk banking or lending societies—to manage these difficulties. Often these responses are due in part to limited access to traditional services either because of language, legal, or other barriers (Lindberg, 1993; Light, 1996; Ebo, 1998; Laguerre, 1998). Immigrants begin to master a cocultural existence seeking a balance between the host culture and their culture of origin (Ebo, 1998).

Immigrant Entrepreneurs in Chicago
Illinois ranks in the top six U.S. states of intended residence for immigrants and Chicago is in the top four metropolitan areas (Immigration and Naturalization Service, 2000). The city of Chicago has been host to immigrants from all over the world from the mid-1800's. For instance, the first German settler arrived in 1825 and the first Chinese men came here to work in 1871 (Lindberg, 1993). I moved here from Kansas City, MO, in part to experience this wonderful banquet of cultures and have explored many of the ethnic enclaves that are part of the city's tapestry.

This project gave me an opportunity to learn more about some of the people I have gotten to know since I moved here, as well as make a wonderful new acquaintance. After meeting with German-born Kurt and Maria Scheel, with Li and Martin Lien from Taiwan, and Eritrean Azib Gebrehiiwet, I learned many things about their personal experience and about how they fit into the framework of immigrant entrepreneurship that I read about or even assumed. (See Assumptions and Reflections for more information.)