Immigrant Entrepreneurs Spark Houston’s Economy
I recently posted a press release article citing the increased number of acquisition inquiries that business brokers in Houston are experiencing from business owners in foreign countries. It seems that Houston is not alone.
The Center for an Urban Future, a New York City-based think tank, in a press release February 6, 2007, revealed a major new study indicating that immigrant entrepreneurs have become increasingly powerful economic engines for cities. The report, titled “A World of Opportunity: Understanding & Tapping the Economic Potential of Immigrant Entrepreneurs,” documents that immigrant entrepreneurs are starting a greater share of new businesses than native-born residents. The study takes an in-depth look at immigrant-owned businesses in New York City, Los Angeles, Houston and Boston.
Based on 18 months of research, this study is built upon extensive data analysis, focus groups conducted with immigrant business owners and economic development experts, and interviews with business owners, immigration experts, ethnographers, local economic development officials, banking and microfinance specialists and government officials.
Here are the major findings for the City of Houston
- An immigrant from Pakistan, founded a wireless communications firm that topped the 2006 Houston Small Business 100 list, a ranking of the city’s most successful small businesses compiled by the Houston Business Journal.
- A native of Nigeria, started an international oil exploration, refining and trading company that now has more than 1,000 employees worldwide and was recently cited as the second largest black-owned firm in the U.S. by Black Enterprise magazine.
- Houston ranks third among all American cities in the number of Hispanic-owned businesses (41,753) and sixth in the number of Asian-owned firms (15,966). It is also home to 16 of the largest 500 Hispanic-owned firms in the country.
Excerpts of other findings reported in the study on the impact of Immigrant-owned Small Business on Houston Economic Growth
Anglo-owned firms still play a leading role in Houston’s economy, and remain dominant in the critical energy, biomedical and aeronautical sectors. Yet, local business leaders say that the proliferation of small-and medium-sized, immigrant-run firms has exerted a strikingly positive effect on the city’s economy, a claim undoubtedly reflected by the fact that 94 percent of the new businesses created in Houston between 1995 and 2005 had fewer than 50 employees.
Shirley Brooks, a senior loan officer at the Houston branch of ACCION Texas, says immigrants and refugees account for about 30 to 40 percent of the business owners and would-be entrepreneurs that come to her office seeking financing. Similarly, Neil Polansky, longtime director of City of Houston’s One Stop Business Center, says that a growing number of the entrepreneurs that come through the center’s doors for information about starting a business are immigrants.
“Immigrant entrepreneurs are now the entrepreneurial spark plugs of cities,” says Jonathan Bowles, director of the Center for an Urban Future and primary author of the report. “While immigrants have a long history of starting businesses in the U.S., their contributions have grown in recent years thanks to an explosion of immigration and their high rates of business formation. They are an incredible asset for cities that has only begun to be tapped for economic development.”