By Dalton T. Sirmans, General Partner
“Migration,” a Special Report in the November 16, 2019 issue of The Economist, includes six articles that compositely seeks to examine and define the issue as it exists around the world. While each of the articles is, in typical Economist style, well researched and revealing, we found several parts of one of the pieces, “How migration makes the world brainer,” particularly enlightening. The article focuses on skilled migrants and how Australia, one of the four countries with the largest populations of skilled migrants, addresses immigration.
“Everywhere, immigrants are likelier than the native-born to start their own business. People who pack up and fly thousands of miles to start a new life obviously have get-up-and-go. Also, many countries do not recognise foreign qualifications … so migrants often become entrepreneurs.”
In Australia, “Applicants for ‘skilled independent’ visas are given points for such things as education, work experience, English proficiency and, crucially, age. The ideal age is 25-32 … applicants with the most points are given permanent residency without even needing a job offer.”
“Australia’s annual intake of permanent migrants has risen since the 1980s, from 69,000 in 1984-85 (including 14,000 refugees) to around 200,000 from 2011 to 2018 (including 10,000-20,000 refugees). … The inflow of brains from all around the world has made Australia richer and more dynamic. Since 1973 its population has doubled; its economy has grown 21-fold. The country has enjoyed 28 years of unbroken economic growth.”
“Globally, the most skilled migrants are the most mobile. They face fewer barriers, because more places want them. … Whereas 80% of refugees and 50% of low-skilled migrants move to a neighbouring country, only 20% of highly skilled migrants do.”
“Three-quarters of skilled migrants go to the ten most popular countries, and
nearly two-thirds move to just four: America, Britain, Canada and Australia. … Within the superstar destination countries, migrants head for a few megastar cities. There are more foreign-born residents in Melbourne or Los Angeles than in the whole of mainland China. The proportions of foreign-born in Toronto, Sydney, New York and London are 46%, 45%, 38% and 38% respectively.”
“Immigrants or their children founded 45% of America’s Fortune 500 companies, including Apple, Google and Levi Strauss. Two-fifths of America’s Nobel science prize-winners since 2000 have been immigrants. Globally, migrants are three times likelier to file patents than non-migrants.”
“Startups that win visas for foreign staff in America’s skilled-visa lottery are more likely to expand, according to a study by Stephen Dimmock of Nanyang Technical University.”
“Multinational firms that hire lots of skilled immigrants find it easier to do business withtheir home countries, says William Kerr of Harvard Business School.”
“The most obvious benefits from migration are what economists call ‘static’ gains—migrants from poorer to richer countries earn more the moment they arrive. ‘But the real gains are the dynamic ones,’ says Caglar Ozden of the World Bank—the complex interplay of newcomers with natives and the outside world.”
“Australia’s unusually open immigration policy is underpinned by toughness. Successive governments have made it clear that Australia decides who can or cannot come. Those who try to migrate illegally are picked up at sea and, if no other country will take them, dumped in a camp on Nauru, a remote Pacific island. This policy is as cruel as it is controversial, but it has deterred irregular migrants from making the hazardous sea journey.”
Businesses founded by refugees are materially more likely to succeed, refugee employees add tangible value to the companies they serve, and as a market, the refugee community is growing year over year. Still, refugees and refugee-founded businesses are undervalued. Investing with a refugee lens, Amplio Ventures backs enterprises that are founded by refugees, leverage the refugee workforce and/or focus on the global refugee community. These investments are designed to yield market-rate returns while achieving measurable social impact.