Download to read offline
Harrison.Clip.Immigration
- 1. WEDNESDAY, OCTOBER 3,2012 KLMNO EZ SU Economy & Business A15 Decline in immigrant businesses fuels concerns Economic recovery in U.S. could pay the price for today’s visa rules Obama’s economic team, Version 2.0 What the president’s lineup might look like if he wins reelection BY J.D. HARRISON The once steady rise in immi- grant entrepreneurship has stalled in the United States, threatening to further slow an already sluggish economic recov- ery. Over the past six years, the proportion of new companies founded by foreign-born individ- uals has slipped to 24.3 percent from 25.3 percent, according to a Kauffman Foundation survey published Tuesday. This updated previous studies showing a boom in immigrant entrepreneurship over previous decades. The group’s researchers now wonder whether “the period of unprecedented expansion of im- migrant-led entrepreneurship that characterized the 1980s and 1990s has come to a close.” The drop is even more pro- nounced in the nation’s preemi- nent start-up community, Silicon Valley, where the number of new firms with at least one immigrant founder dropped to 43.9 percent from 52.4 percent in 2005. “I knew the numbers were slowing, but that was shocking, andthat’swhenIrealizedthiswas worse than we thought,” Vivek Wadhwa, director of research at the Center for Entrepreneurship and Research Commercialization at Duke University’s Pratt School of Engineering, said in an inter- view about the study, which com- piled data from 1,882 firms na- tionally that were started in the past six years. (Wadhwa writes a columnforTheWashingtonPost.) The growing consensus among economists is that young busi- nesses — rather than small busi- nesses in general — represent the most reliable, consistent source of job creation, and foreign-born entrepreneurs have long been at the helm of many of those firms. In December, the National Foun- dation for American Policy re- leased a study showing that near- ly half of the country’s top ven- ture-backed, early-stage compa- nies were founded by at least one immigrant. Expanded to include fast- growing start-ups with immi- grants in upper-management po- sitions, the number leaps to 74 percent. But increasingly strict immi- gration laws are making it more difficult for those immigrants to start their enterprises in the Unit- ed States, prompting a “reverse brain drain,” according to the re- searchers behind the Kauffman study. Of particular concern is the growing number of foreign-born students who earn advanced de- grees at U.S. universities but after graduating are forced to return home, where some create firms that compete against American companies. Last month, 165 university presidents and chancellors sent a letter to Congress and President Obama urging them to support visa changes that would allow foreign-born students who earn advanced degrees to stay in the United States and work or start companies here. The current im- migration system, they said, pos- es “a critical threat to America’s preeminence as a global center of innovation and prosperity.” Lawmakers have already pro- posed several remedies over the pastyear—mostrecently,Startup Act 2.0, which would create a new visa category for immigrants who start companies and hire workers in the United States. The bill would also provide green cards forstudentswhoreceivegraduate degreesinmathandsciencefields from U.S. colleges. But the meas- ure has been stalled by a bitter partisan divide over broader im- migration changes. “Both sides support these tar- geted changes, but Democrats want comprehensive immigra- tion reform, and they’re con- cerned that, if this is taken care of, the urgency around immigration reform won’t be there anymore and they won’t be able to resolve the larger amnesty issue,” Wadh- wa said. “So you have the all-or- nothing strategy versus the all- the-job-creators-we-can-get strategy. That’s what it boils down to right now.” Should lawmakers not address the country’s immigration issues, the economic road to recovery may get significantly longer, Wadhwa warned, and the United States will likely struggle to main- tain competitiveness in global markets. “If we wait five years to fix the immigration system, the undocu- mented, illegal workers will still be here, but the high-skilled im- migrants will be long gone,” he said. “They’ll be back home build- ing the next Googles and Intels in other countries, and we will wake up five years from now and won- der how we let this happen.” harrisonj@washpost.com Twitter: @jd_harrison and @onsmallbiz. BY NEIL IRWIN In the high campaign season, the clash between President Obama and Mitt Romney de- mands most of the attention of the two rivals and their aides: how to attack, when to parry and so on. There is not much time on the trail for them to consider the gory details of how they might govern, in a second term for Obama or a first for Romney. But come Jan. 20, somebody will govern, and he will confront an economy that remains stuck in high unemployment and slow growth, as well as enormous budget deficits and a polarized political environment that makes addressing either a difficult task. Based on conversations with economic policy veterans allied with each party, here is a run- down of how the president could build his economic team as he picks his Treasury secretary and White House advisers, with the Romney version to come Thurs- day. Timothy F. Geithner has made no secret of his intention to step down as Treasury secretary at the end of Obama’s first term, leaving open the administration’s senior- most economic policy job. When Geithner came into office in 2009, job No. 1 was rescuing the nation’s financial system. In 2013, the Treasury secretary faces the chal- lenge of helping to manage high- stakes negotiations over U.S. fiscal policy. Obama, his aides have said, hopes to leave office with a longer- term deficit reduction deal in place. Two veterans of fiscal policy battles would have an edge in considerations for the big office at 1500 Pennsylvania Ave.: White House Chief of Staff Jacob Lew and fiscal commission co-chair- man Erskine B. Bowles, who was a chief of staff in the Clinton administration. Both know the budget backward and forward and have long experience in the trenches negotiating with con- gressional Republicans. Lew is a favorite of many inside the White House and is viewed as an effective chief of staff. But in moving next door to the Treasury Department, Lew would leave Obama with another major job to fill. Bowles has shown more inde- pendence from the president and less willingness to toe the Demo- cratic Party line while leading the Simpson-Bowles commission. But he would also add to the president’s credibility as a deficit hawk in negotiations over a long- term budget deal. Other names that could show up on the list include outsiders, such as Wall Street titans Larry Fink and Roger Altman, and ad- ministration insiders, such as Gene B. Sperling of the National Economic Council, Deputy Treas- ury Secretary Neal S. Wolin and Lael Brainard, undersecretary for international affairs. Other changes to the economic team would probably be less dra- matic than they would be under a Romney administration, but there is sure to be some shuffling around as some officials return to the private sector or seek new jobs within the government. Michael Froman, the White House adviser for international economic matters, is a strong candidate to replace Ron Kirk as U.S. trade representative. Sperling, who was also NEC director during the Clinton ad- ministration, seems inclined to stay around a bit longer, even without a promotion. But at some point there might be a vacancy in that crucial job of coordinating the administration’s economic policy. If Sperling took that job, it would offer a chance for one of his deputies, such as Jason Fur- man, to succeed him as NEC chief. Jeffrey Zients has won strong reviews for his performance as acting director of the Office of Management and Budget, despite having relatively little experience with the federal budget. Coming from a corporate background — as chief executive of the Advisory Board Co. — Zients worked on the management side of the OMB before serving as acting budget chief. With his business-heavy résumé, he could be tapped for commerce secretary and serve as the administration’s liaison to the corporate world, working to patch up Obama’s strained rela- tionship with business. Lew and Bowles are most experienced with domestic fiscal matters. If either is named Treas- ury secretary, he might consider a deputy with a strong background in international affairs. Brainard, Geithner’s point person on the euro-zone crisis, the United States’ economic relationship with China and other delicate tasks of financial diplomacy, would offer that experience. If she took that job, Brainard could be in line to take Treasury’s top job late in Obama’s second term or in a future Democratic administration, as Larry H. Sum- mers did after serving as deputy secretary under Robert Rubin. But there’s also a chance she could move to the White House, perhaps to succeed Sperling at the NEC. Mary Miller, the Treasury un- dersecretary for domestic fi- nance, could emerge as a candi- date for any of several financial regulatory jobs, such as a post on the Commodity Futures Trading Commission or as one of the bank regulators. irwinn@washpost.com The growing burden on caregivers Once again, my husband and I have joined the millions in this country providing care for an elderly relative. A few years ago, we cared for my husband’s father. But he insisted on returning to his home. The situation worked for a while. Then it became clear that my father-in-law would need to move back in with us. There is joy in caregiving. Yet it’s also a tough job, and it can bring on lots of stress, anxiety and a strain on your finances. And in our country’s never- ending battle to contain health- care costs, caregivers are increasingly performing tasks usually left to trained medical staffs. Patients who are discharged from the hospital or return home after same-day medical procedures often require a lot of medical attention. When that patient is elderly with chronic physical and cognitive conditions, many of those medical duties may fall to a member of the family. A report from AARP’s Public Policy Institute and the United Hospital Fund, a nonprofit research organization, confirms what many caregivers have known for years — that they are doing far more than helping with daily living tasks such as bathing, dressing, eating, shopping and/or managing the finances of elderly parents or relatives. “At a time when federal and state health policy is driving changes to reduce hospitalizations and nursing home admissions, it is critical to consider who will care for people with multiple chronic conditions who need substantial help with tasks that are often considered ‘nursing’ or ‘medical’ care,” the report’s authors wrote. “The default is the family, ready or not.” There are more than 42 million unpaid family caregivers in the United States, according to the report, “Home Alone: Family Caregivers Providing Complex Chronic Care.” Almost half of family caregivers performed medical or nursing tasks that included managing multiple medications, helping with devices for mobility, preparing food for special diets, caring for wounds, administering IVs and injections, using monitors, managing incontinence and operating specialized medical equipment. The report was based on a national survey of 1,677 family caregivers. Many respondents reported having to administer five to nine prescription medications a day. Forty percent of those surveyed said they felt stressed and worried about making a mistake. At one point, to manage all the medication my father-in-law had to take, my husband created a spreadsheet, which included dosage details — how many times a day, how much — and what the drug does. Although the report was aimed at professionals in the elder-care field and policymakers, it’s an important validation for caregivers’ expanded responsibilities and shows that they need more training. “It really calls for far more systematic and sustained efforts to help family caregivers perform tasks that 20 years ago would have been done in hospitals,” said Carol Levine, director of the Families and Health Care Project for the United Hospital Fund. “Having been there myself, often the tasks are presented to you as ‘This is what you need to do’ rather than ‘Are you able to do this or willing to do this?’” So what do you do if you are a caregiver facing more medical or medication responsibilities than you think you can handle? Ask for help. “Find out what types of help are available,” Levine said. “What you also need to do is be realistic about what you can and can’t do.” In our case, we hired professional long-term care assistants to help with my father-in-law, who requires a great deal of care and monitoring for his diabetes. If your elderly relative is being discharged from a medical facility and you aren’t comfortable administering medication or handling medical equipment, let the medical team know. You might get pushback, Levine said, but press anyway. “While loved ones are in the hospital, you aren’t allowed to touch pills or run machines, and then when they are ready to go home, you get a quick tutorial,” Levine said. “In the hospital, there is always somebody to call — an aide, nurse or doctor. When you are home, you are really all alone. I don’t think professionals understand that.” If you’re a caregiver looking for help, go to www.aarp.org/ homefamily/caregiving. Read the article by Levine on whether you are suited for the medical jobs of family caregiving. You can also find resources at www.nextstepincare.org. Family caregivers are crucial in the mission to lower health- care costs. But if we don’t take care to make sure they are supported and trained for all the care they have to give, this mission will fail. Readers can write to Michelle Singletary at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071, or singletarym@ washpost.com. Personal responses may not be possible, and comments or questions may be used in a future column, with the writer’s name, unless otherwise requested. To read previous Color of Money columns, go to postbusiness.com. Michelle Singletary THE COLOR OF MONEY Timothy F. Geithner has made no secret of his intention to step down as Treasury secretary. Holiday forecast less merry for retail Group expects slower sales growth than in past two seasons BY ANNE D'INNOCENZIO new york — Americans are ex- pectedtospendmoreduringwhat is traditionally the busiest shop- ping season of the year, but they are not exactly as ready to shop till they drop as they have been in the past two years. TheNationalRetailFederation, the nation’s largest retail trade group, said Tuesdaythatitexpects sales during the winter holiday shoppingperiodinNovemberand December to rise 4.1 percent this year. That is more than a percent- agepointlowerthanthegrowthin each of the past two years and would be the smallest increase since 2009, when sales were up just 0.3 percent. The projections are an impor- tant indicator for retailers that depend on the last two months of the year for up to 40 percent of their annual sales. But the esti- mates also offer valuable insight for economists who closely watch consumer spending, which ac- counts for up to 70 percent of economic activity. The holiday shopping season is one gauge of not only the shop- ping habits but also the mind-set of the average American during what has turned out to be a slow and uneven economic recovery. People are feeling better about rising home prices and a rebound- ingstockmarket,butjobgrowthis still weak and prices for things such as food and gas are higher. “Inalltheyears,thisisthemost challenging year doing a forecast,” said Matthew Shay, president and chief executive of the National Re- tail Federation, based in Washing- ton. “There are so many uncer- tainties.” No one’s feeling those uncer- tainties more than U.S. shoppers. Darlene Johnson of Silver Spring said her outlook has improved in the past few months. The value of her 401(k) retirement plan has risen. Home sales where she lives are up again, and her neighbors are getting higher prices for their houses. Still,Johnson,who’sbeengrap- pling with higher food and gas prices, says the economy is still not stable enough for her to splurge during this holiday shop- ping season. Last year, she overindulged and spent about $5,000, she said. It took until this past May to pay down her credit card debt. As a result, this year she plans to cut her holiday spending to $1,500. “I felt too much pressure finan- cially,” said Johnson, who works for the National Institutes of Health. “I am not going to do it to myself again.” It’s Americans’ worries about the economic uncertainty that led the National Retail Federation to predict slower growth during the winter holiday shopping season thantheincreasesof5.6percentin 2010 and 5.5 percent in 2011. The federation’s forecast is more optimistic than that of the Interna- tionalCouncilofShoppingCenters, a mall trade group that last week said it predicts a 2.9 percent in- crease. It’s also higher than the 3.3 percent growth estimated last month by ShopperTrak, a Chicago- basedanalyzerofretailfoottraffic. The forecasts come as retailers wrap up what is expected to be a strong back-to-school shopping season.Therehavebeennoofficial numbers out on sales for that shopping period, which is typical- ly the second-biggest shopping seasonoftheyearandabarometer for what people are willing to spend during the winter holidays. But Ken Perkins, president of Re- tailMetrics, said he expects rev- enue at stores open at least a year to be up 5 percent for the com- bined August and September months. For their part, retailers already arebeingcautious.JohnChalleng- er, chief executive of Challenger, Gray & Christmas, says retailers are expected to increase holiday hiring by 6 percent to about 700,000 for the October-through- December period compared with a year ago, when that figure was 660,200. The National Retail Fed- eration predicts that merchants will hire between 585,000 and 625,000 seasonal workers for the holidays. That is in line with last year’s 607,000, according to the trade group’s measure. Retailers are already starting to offer enticements to lure holiday shoppers. Kmart, Toys R Us and Wal-Mart Stores announced last month that they are either lower- ingorwaivingtheupfrontservices fees for their interest-free pay- over-time program. All three said the moves were in response to complaints from shoppers. — Associated Press MATT MCCLAIN FOR THE WASHINGTON POST Black Friday shoppers crowd a Fairfax Best Buy last year. The National Retail Federation said it expects holiday sales to rise 4.1 percent this year, after rising 5.5 percent in 2011.