Reclaiming Cleveland's Immigrant Entrepreneurs

In an increasingly global economy, highly skilled and entrepreneurial immigrants provide the necessary bridge to the talent, business, and capital in their homeland. The risk-taking factor in the immigrant community, coupled with scientific accomplishment, internal networks providing seed capital, and access to inexpensive overseas labor markets, provide a formidable combination for local economic development. Recent studies show that immigrants to the U.S. are much more likely to be entrepreneurs than native-born Americans. For some immigrant groups, the entrepreneurship rate is 2 to 3 times greater than the American-born population. As a result, Northeast Ohio is less connected to global opportunities (particularly in emerging markets), and remains vulnerable to adverse consequences of globalization.

In contrast, our bustling neighbor to the north, Toronto, enjoys a foreign-born community that comprises 43% of its total population. In studying regions around the U.S., research finds that “the leading edge of population and economic growth in the country is related to immigration," particularly from Asia and Latin America. The Brookings study revealed the percent change of the foreign-born population from 1980 to 2000 for the following cities: Atlanta: +816%; Raleigh-Durham: +709%; Las Vegas: +637%, Austin: +580%, Denver: +258%, Salt Lake City: +211%, Minneapolis: +196% and Cleveland: -11%

Only Pittsburgh and Buffalo (classified like Cleveland as former "immigrant gateways"), performed worse, by losing -23% and -26% respectively. Clearly, Cleveland should attempt to reclaim some of its glory as an immigrant magnet for international talent and entrepreneurship. Researchers have found that many foreign-born scientists and engineers in Silicon Valley acted as entrepreneurs and as middlemen who facilitate trade and investment links with their countries of origin. In 2000, Indian and Chinese entrepreneurs alone headed 29% of Silicon Valley’s technology businesses. Collectively, these companies accounted for $19.5 billion in sales and over 77,000 jobs in Silicon Valley.

Cities like Austin, Denver, Boston, and San Jose have greatly benefited from high levels of immigrant technology talent. Almost 25% of the founders or chairman of the biotech companies in the U.S. that went public in the early 1990s also came from outside the U.S. In an effort to reverse economic decline and post-industrial depopulation, cities such as Pittsburgh, Baltimore, Indianapolis, Louisville, Philadelphia, Minneapolis, Schenectady, and the state of Iowa have recently employed ways to partner with their existing immigrant communities in order to pro-actively attract more internationals, whether residing in or outside the U.S., to relocate to an immigrant-friendly destination for starting or expanding business operations, attending college, raising a family, etc. Without the rich immigrant history and diversity that Northeast Ohio enjoys, the Spartanburg-Greenville region of South Carolina has become a world-class center for manufacturing, creating the highest diversified foreign investment per capita in the United States.

One of the best ways for Cleveland to boost its international population and promote economic growth is to attract and retain a greater international student pool at our area colleges and universities. One of the key engines for Silicon Valley’s entrepreneurial growth in the 1980s and 1990s was the fact that many international students to California colleges and universities started new companies in the Valley upon graduation. This is to be expected considering that the percentage of Master’s Degrees awarded to foreign students was high in Computer Science (48%), Physical Science (41%), Engineering (40%), and Mathematics (35%). Over 44% of all patents filed in the U.S. are filed by internationals.

Cleveland is rich in higher education resources as higher education is one of Ohio’s most significant “exports.” According to the National Association of International Educators in 2002-2003, Ohio’s 18,668 foreign students (and their family members) made a net contribution to the State economy of $425,028,000 in tuition and living expenses. International Students to Northeast Ohio contribute over $100,000,000 to the regional economy per year. Cultivating this population upon arrival in Northeast Ohio is key, considering that 90% of the foreign students in Northeast Ohio leave the region upon graduation.

It is clear that successful regions have partnered up with their immigrant, bilingual and minority communities to help build the necessary bridges to the global and multicultural marketplace. Multi-cultural meccas with hyper-global connectivity will dominate the 21st century. Cleveland's economic woes require work on many fronts, and its rich diversity and immigrant history provide one of the keys to a future economic renaissance.

from Cool Cleveland readers Rose A. Zitiello, Esq. and Richard T. Herman, Esq. Rose Zitiello, Esq. is a specialist in community development, and host of Cuyahoga County Community College's Smart TV program Cleveland's Diversity, Historic and Contemporary Cultures: Their Struggles and Contributions. Richard Herman, Esq. is the principal of Richard T. Herman & Associates, a Cleveland multicultural law firm speaking over 10 languages and serving diverse communities. Ms. Zitiello and Mr. Herman are available for public speaking engagements and consulting. They can be reached at rzitiello@aol.com and herman@asklawyer.net

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