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‘About 25% of inventors and entrepreneurs in the US are foreign-born now our business leaders must articulately describe how migration benefits America’

William R. Kerr is D’Arbeloff Professor of Business Administration at Harvard Business School. Speaking to Srijana Mitra Das, he discusses migration’s gifts to the US economy — and managing the backlash against it.

Q. What is the core of your research?

A . My work focuses on innovation and entrepreneurship, including looking at how these two forces impact economic growth and the policy environments that shape them. This links to immigration policy, given how important immigrants are for innovation and entrepreneurship in the United States.


Q. What are the gains America has made from ‘talent immigrants’, as you write?

A. Immigrants play a central role in US innovation and entrepreneurship — today, roughly 25% of inventors and entrepreneurs in America are foreign born. These shares have grown substantially over the last four to five decades from being around 10% in the 1970s. Their contribution spans most sectors of the conomy, from low-skill service industries to very high-tech, venture capital-backed companies. One estimate suggests that 30% to 50% of US productivity growth from 1990- 2010 was due to skill immigration and its impact on productivity. In addition to this aggregate effect, immigration has substantially shifted the geography of US innovation towards tech hubs like Boston, Seattle and San Francisco.


Q. Given these facts alongside robust US employment, why is there a rising backlash against immigration in America?

A. This backlash is not just in America but in many countries. While we live in a time of amazing technological progress and new opportunity, there is also significant worry of displacement due to economic dynamism. Many people experience deep uncertainty about the future while regional differences in economic outcomes can also widen — it is often easier to see the benefits from immigration when a person is living in a high-tech cluster like Silicon Valley than when they are residing in a stagnant rural community. Unfortunately, at many points throughout history, foreigners have been a convenient target for politicians seeking to capitalise on precisely such discontent.


Q. In an election year, American politicians are calling for curbs on immigration — what are the implications for migrants’ quality of life in the US?

A. The choices of when and where to immigrate, potentially for studying or work, involve an investment. Migrants want to build a life in their new home, establish their base and professional networks and look to the future — harsh political calls for reduced immigration and animosity towards existing migrants raise deep uncertainty for immigrants in a country. They could think, ‘What will be my future here? Should I raise a family here?’ When contemplating investments like migration, this uncertainty is deeply unsettling. Alongside, it is important to note that US immigration systems have never been ‘user-friendly’ but America remained a top choice for migrants because of the great opportunities here — once you cleared the hurdles. Harsh political rhetoric casts deep uncertainty into the process, reducing the attractiveness of the country as compared to other destinations.


Q. Skilled migration is often thought of as largely male — is there an overlooked gender dimension to this discussion?

A. About 70% of H-1B visa applicants are male, reflecting in part the heavy use of the program for technical and computer-related occupations which remain unfortunately imbalanced on gender. That said, today, skilled immigration globally is higher among women than men — therefore, policy makers and business leaders should pay close attention to their destinations being attractive for women migrants.


Q. What are your suggestions for improving the current H-IB visa system?

A. This could be bettered in many ways. The most important improvement would be to prioritise how visas are allocated, given that demand is far greater than the supply — the lottery system is very inefficient. It should be replaced by a mechanism like wage ranking or auctions. I would also institute a minimum wage for the visa. Such reforms would help build political support for skilled immigration. Additionally, I advocate for the program’s size to be indexed to employment levels or economic conditions, rather than being set at rigid levels that only get adjusted every decade or longer after an extended political fight. Other areas for improvement include better school-to-work transitions, spousal work authorisation, moving to a quarterly system and possibly a regional visa component.


Q. We’ve seen politicians’ contributions to the discussion — can business leaders raise the tone of the discourse about skilled migration to the US?

A. Business leaders must do a better job of explaining to Americans the benefits that skilled migration brings to the economy. The US immigration system gives employers significant power in the selection of employment-based migrants. For employers to hold on to that special role, they must become more articulate about why the whole country benefits from skilled migration — and not just a handful of tech clusters.


By Srijana Mitra Das

https://economictimes.indiatimes.com/epaper/delhicapital/2024/jan/26/et-oped/about-25-of-inventors-and-entrepreneurs-in-the-us-are-foreign-born-now-our-business-leaders-must-articulately-describe-how-migration-benefits-america/articleshow/107157532.cms

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