December 9, 2022

By BRUCE CORRIE

We are inundated with stories about the costs and burdens of immigrants. This is a myopic view of immigrants as it focuses only on fiscal costs. What is missing is a larger picture of how immigrants interact in our economy – as entrepreneurs, consumers, workers, human capital, civic capital, fiscal capital, cultural capital and global capital. I call this immigrant capital.

When we look at immigrant capital we can see a different picture of the role of immigrants in the American economy.

I will give you examples from Minnesota – a state that is increasingly becoming a nodal point of immigrants settling in the USA be they the Hmong from Asia or the Somalis from North Africa.

One just has to visit certain commercial corridors in the Twin Cities to see how immigrant entrepreneurs have vitalized run-down neighborhoods, providing services, jobs and serving as role models in their communities. Immigrant entrepreneurship is also occurring at the high tech level in areas such as alternative energy, information systems and manufacturing. The number of Asian and Latino firms is growing at a much faster rate than all the other firms in the state.

Immigrants are also consumers of goods and services. I estimate Asian and Latino buying power in Minnesota to be close to 12 billion dollars. Nationally I estimate African immigrant buying power to be larger than the GDP of most countries in Africa – an estimated 45 billion dollars. Immigrants are also introducing new products and services to the local economy.

Immigrant workers complement the local workforce in Minnesota working in areas such as the meat packing industry or the hospitality industry. They are also serving as professionals in rural Minnesota as doctors and high tech workers for example. Minnesota is facing a looming worker shortage with the ageing of the population – in this context Asian and Latino workers are going be an increasing share of the prime worker base in Minnesota.

Immigrants also add to the quality of human capital in Minnesota with many immigrants from Asia and Africa having skill levels higher than the native population. They also are becoming an increasing presence in schools in rural Minnesota that are facing declines in student population.

Immigrants are playing an important role in the civic life of Minnesota. Apart from being elected to the Minnesota legislature they have a presence in the Governor’s cabinet, elected to local offices and serve as a vast army of volunteers to all political parties actively engaging in the political process.

Immigrants also add to the fiscal revenue of the state. Asian, African and Latino workers are going to be an increasing share of the prime tax base of the future. The Minnesota tax incidence study reports that on average a resident pays around 11 percent of their income in state and local taxes. I estimate that just one immigrant group, Asian Indians in Minnesota pay an estimated $200 million in state and local taxes in Minnesota.

Immigrants add to the cultural capital in Minnesota in theatre, arts, music, dance, and cuisine. They have added new festivals to the cultural landscape – for example, we now have the annual dragon festival and boat race that is increasingly becoming very popular in the summer.  Chicken curry could soon by the new hot dish of Minnesota!

Immigrant’s global networks are increasingly being tapped to improve the state’s competitiveness. Before major trade missions to India, China, Mexico and Japan, Minnesota governors have tapped into the local immigrant community to help build bridges into the future. Immigrants have responded with new global organizations such as the India Chamber of Commerce and the US China Business Council. These networks are also seen in the nonprofit and cultural areas from providing immediate responses to the Tsunami in Sri Lanka and the earthquake in Haiti to offering long term assistance to countries around the world.

I did some quantitative simulations to assess the impact of immigrants on various sectors of the Minnesota economy. The approximately 4,000 Liberians in the health care sectors in Minnesota have an estimated 300 million dollar impact on the economy. The almost 2,500 workers of Mexican origin in the meatpacking industry have an estimated 432 million dollar impact on the larger economy.  When we look at the progress of the Hmong in Minnesota we find we have a great return on our investment. From 1990 to 2007 poverty rates and welfare dependency have declined dramatically while homeownership rates, college graduation rates and workforce participation rates have increased significantly.

Immigrant capital is making Minnesota strong. Immigrant capital is making America strong. It is time to change the paradigm how we view immigrants in the economy.

Bruce Corrie, Ph.D., is the Dean of the College of Business and Organizational Leadership, Concordia University, St. Paul.

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