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  • Immigrant brain-drain challenges US innovation

    March 2, 2009

    Placing limits on foreign workers may be stifling innovation in the US. That’s the conclusion of a Kaufman Foundation study titled “America’s loss is the world’s gain,” conducted by Harvard professor Vivek Wadhwa.

    "A substantial number of highly skilled immigrants have started returning to their home countries in recent years, draining a key source of brain power and innovation," says Robert E. Litan, VP of research and policy at the Kauffman Foundation, in a press release. "We wanted to know what is encouraging this much-needed growth engine to leave our country, thereby sending entrepreneurship and economic stimulus to places like Bangalore and Beijing."

    The release states: “Immigrants historically have provided one of America’s greatest competitive advantages. Between 1990 and 2007, the proportion of immigrants in the US labor force increased from 9.3% to 15.7%,” adding, “Immigrants have contributed disproportionately in the most dynamic part of the US economy—the high-tech sector—cofounding firms such as Google, Intel, eBay, and Yahoo.” (By mentioning Intel I assume the foundation is alluding to Budapest-born Andrew Grove, although San Francisco-born Gordon Moore and Iowa-born Robert Noyce are the cofounders. Nevertheless, the foundation’s point stands.)

    The foundation reports that immigrant inventors contributed to more than a quarter of US global patent applications and says that immigrant-founded US-based companies employed 450,000 workers and generated $52 billion in revenue in 2006.

    Says study author Wadhwa, "While some have tried to associate the increase in foreign workers over recent years with the economic problems that have plagued the country, this data verifies the opposite effect. If the US government and the business community could find better ways to offer good jobs in tandem with less restrictive visa policies for talented immigrants, the US might be able to recapture many of these immigrants and their potential to help grow the US economy."

    The two-year study focused on 1203 Indian and Chinese citizens who had studied or worked in the US for a year or more before returning home, primarily in the fields of management, technology, or science. Most had advanced degrees. Demands for their skills in their home countries as well as family considerations were the main factors prompting them to return home. A majority said they would like to start businesses within the next five years and said they believed that their own countries offered better career opportunities to launch startups.

    Posted by Rick Nelson on March 2, 2009 | Comments (18)
    Industries: Communications Test
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  • December 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Shakthivel commented:

    Real innovation comes from Westerners ( USA + Europe). Immigrants from India & China others are more hardworking and discipline in order to survive which results in higher rate of business growth.


    March 5, 2009
    In response to: Immigrant brain-drain challenges US innovation
    NoOne commented:

    I am wodering why people blaming H-1B for their job loss. Most of the job losses in the US were caused by US companies outsource their jobs overseas. They build facilities in low cost countries like India and China, hire people there and fire people here. H-1B actually help keeping jobs in US soil, which in turn helping US economy. Plus H-1B visa is limitted to 65,000 annually. There is no reasons to blame the massive job losses in US to H-1B program.


    March 5, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Van Martin commented:

    Interesting that with as many unemployed engineers as have been turned out over last 5 years that we still have H1B at all. This is not to stir the H1B pot yet-again, but I wonder if the whole idea of educating the world, then internalizing the results isn't counter-productive. As others have said in their comments, our youth does not see a future in engineering, so choose paths that lead to further brain drain in USA as H1B's and green-card aliens go back home. USA used to foster some unique thinking with our freedom and curiosity. Not sure we can recapture that for a generation or so :-(


    March 5, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Van Martin commented:

    Interesting that with as many unemployed engineers as have been turned out over last 5 years that we still have H1B at all. This is not to stir the H1B pot yet-again, but I wonder if the whole idea of educating the world, then internalizing the results isn't counter-productive. As others have said in their comments, our youth does not see a future in engineering, so choose paths that lead to further brain drain in USA as H1B's and green-card aliens go back home. USA used to foster some unique thinking with our freedom and curiosity. Not sure we can recapture that for a generation or so :-(


    March 3, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Jack commented:

    My son got a 720 on his SAT and is now a LT in the Navy. He studied finance and not engineering, because in 1999 he said, " I can't compete with all those Chineese." Let's be honest, the rate of immigration is a disincentive to study engineering of any kind, much less electrical or computer engineering. Look around you, there is no long term stability in the sciences because of the cheap labor brough in from overseas or shipped over the NET to the same countries. Get your brain around 2.5Billion (Chindia) and you can see that we cannot continue with 19th and Mid-20th Century immigration policies and nostalgia.


    March 3, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Starman commented:

    Good riddance. The amount of immigration, but legal and illegal has been totally disproportionate to the economic beneift they have delivered. Just think of all the costly infrastructure that has to be built to support the endless streat of newcomers: roads, hospitals, schools, universities, etc. etc. So, now we need immigrant doctors, immigrant nurses, immigrant nanies, immigrant school teachers, bi-linqual teachrs and so on just to support the immigrants that just preceeded them. The reality is that all this immigration is just downward pressure on wages and standard of living. Question: Should we allow the rate to be 20 million per year? or 1 million per year, or 10 per year. It used to be if you a Masters degree that meant a big house, a vacation home, and kids went to private school. Now it means middle class and you are still one of the highest paid people you know. So I say GOOD RIDDANCE and DON'T COME BACK!!!


    March 3, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Starman commented:

    Good riddance. The amount of immigration, but legal and illegal has been totally disproportionate to the economic beneift they have delivered. Just think of all the costly infrastructure that has to be built to support the endless streat of newcomers: roads, hospitals, schools, universities, etc. etc. So, now we need immigrant doctors, immigrant nurses, immigrant nanies, immigrant school teachers, bi-linqual teachrs and so on just to support the immigrants that just preceeded them. The reality is that all this immigration is just downward pressure on wages and standard of living. Question: Should we allow the rate to be 20 million per year? or 1 million per year, or 10 per year. It used to be if you a Masters degree that meant a big house, a vacation home, and kids went to private school. Now it means middle class and you are still one of the highest paid people you know. So I say GOOD RIDDANCE and DON'T COME BACK!!!


    March 3, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Andy commented:

    Unfortunately we want to encourage illegal and uneducated immigration and keep out the ones that benifit this country. Government gets more power when its people require it's help. We need to stop voting the same people back into office. Get rid of the politicians and bring this government back to the people. I live in NH and this year my property taxes went up by over 50%. I payed 300K for my house less than 10 years ago. At the time the property taxes where @ $2500/ yr last year they were just under $8 this year they went to $11950. I may loose my house not because I lost my job. Not because I can't afford the mortgage but because I can't come up with another $330 a month to cover the increase in taxes. I am a degreed mechanical engineer and $12000/yr ($1000/month) is more than 10% of what both my wife and I make on 2 jobs each. When the Obama tax increases hit what the hell do I do then. How many jobs do I have to work? Why should I work sso hard when the government just takes it all away. Its time to take the government back and get rid of as much as we can. Socialism doesn't work and thats what Obama wants. Vote out incumbance vote for a third Party! Keep this America.


    March 3, 2009
    In response to: Immigrant brain-drain challenges US innovation
    arclight commented:

    We do need to grow local talent; that will take closer to 20 years than 10 even if we start now. In the meantime, we are going to need to ensure we get the immigrants that are actually going to contribute to the talent pool. Unfortunately, that won't happen because on this particular issue, the extremists from both the Democrat and Republican parties actually agree on what is needed (if not on why it's needed). The Democrat extremists want to let illegal immigrants into the United States by the droves so they can be "compassionate" and tax the wealthy to death to pay for them. The Republican extremists want to let illegal immigrants into the United States by the droves so they can serve as cheap (slave) labor for companies. The political influence of these two sets of extremists ensures that we never get to a rational immigration policy, and that even basic border controls fail over and over (remember the "never again" amnesty of 1986? Why do you think it failed?). Until we are willing to really confront how Congressfolks fund their election campaigns and break the stranglehold that money has on the Congress being able to do its job, and until we are willing to force the Congress to stop using the budget and the tax code to pay off contributors, reward friends, and punish enemies by passing real amendments with teeth that require a balanced budget and a sane tax code, it's very hard for me to see how anything changes in this space.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    bradstew commented:

    WE NEED TO ENCOURAGE US CITIZENS TO BECOME ENGINEERS. PERIOD. WE HAVE TOO MANY MBA'S AND OTHERS THAT NEED TO CREATE "PRODUCTS" FROM NOTHING.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    D. Laturell commented:

    Certainly this is a most interesting debate. It is entirely possible that the US has maintained it's lead because this is (or was?) the place foreign born talent wants to be and that immigration policy merely reflects that larger desire. If talent and investors do not want to be here or invest here, there is no immigartion policy that can change that. The point is we need to focus on making the US the most attractive place in the world to grow new business opportunities and talent will follow to drink from that well.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Baskaran commented:

    Half of the American companies are run by communist style leadership teams even though America is a 'considered' capitalist. Those generous companies who paid $80 (while their asian counterpart only pays $8 an hour in the same American soil) an hour for tightening bolts are feeling the pain and borrowing money mortgaging the past glory. In a nutshell if the 'talent' is not treated well it will find its own place where it is respected. Too bad that America is in the loosing side when it wants to 'protect' the interests of the public - whereas it is biting the feeding hand.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Policebox commented:

    Let's be clear here. For the last several decades the US has maintained its lead by attracting foreign born talent instead of trying to train native born talent. That strategy is now coming to an end. If we just stand here, not only will other countries draw away their native talent, they will draw away ours! It is true that simple economics will dictate that, but the US will be the loser. We need to ask what we are going to do about it. Let's begin by facing the fact that, even if we could get our educational system to jump into world competetive performance, it will still take a decade before we are turning out enough native talent to keep our leadership position. Second, having seen the grass roots of a typical American education system, I don't think the people that are involved in it and run it really understand what is needed. Changing their perspective is going to take years as well. We need to get busy, or the US will fall way behind.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    D. Laturell commented:

    Activities yielding the highest economic value will attract investors and innovators no matter the country of origin of the innovator and no matter the country of origin of the organization or investors. This is more a matter of investment opportunity and environment and less a matter of immigration. (all due respect to the Kauffman Foundation) This "natural selection" will continue to be the most important factor to influence who innovates and where the innovation takes place.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    McQueen commented:

    It sounds like this article trying to stir up another round of H1B discussion, which we already had too much before on some other article.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Joe commented:

    Well said, I think our country was #1 in all categories until 2001. Without innovation, one can not claim #1. Looking back in 1958 with PNP transistors to Yahoo to latest ASIC from iPhone, one can see that innovation was there with helping hand from immigrants and their patents filings. 1. What we need is a collaborative working relationship with immigrants and our traditional management from 70’s, (i.e. I mean do for your country and not for your own company or your self), then, we can regain our place # 1 in for technical, science and aero-space arena.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    John commented:

    I think let them go and start to train local people. What happened, they took experience from here and killed tons of jobs in here. This is because universities wanted to make millions on foreign students.


    March 2, 2009
    In response to: Immigrant brain-drain challenges US innovation
    Meredith Poor commented:

    More than likely, any significantly new enerprises at this point are going to come from leadership with a foot on each continent. Americans don't know much about current realities in China or India, and asians have little idea what will sell in the United States. The 'country of residence' is going take on the characteristic of an electron cloud: you'll never know where one is at any particular moment.

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