Immigrants Own Businesses in NYC at Twice the National Rate

An FPI report on immigrant small business owners nationwide found that while over 18 percent of small business owners in the United States are immigrants, twice that amount (36 percent) can be found in the New York metro area.

A recent report by the Fiscal Policy Institute, “Immigrant Small Business Owners: A Significant and Growing Part of the Economy (PDF),” found that immigrants own more than a third — 36 percent — of the New York metro area’s small businesses, a 66-percent increase between 1990 and 2010, reported WNYC. In the United States overall, 18 percent of small business owners are foreign-born.

The study based the findings primarily on the 2010 American Community Survey, with data also coming from the Current Population Survey and previously unpublished data from the Survey of Business Owners, according to the FPI’s press release.

The report focused on the number of immigrant small business owners nationwide, and found that when it comes to immigrant-owned small businesses, New York comes behind Los Angeles, at 44 percent, and Miami, at 45 percent. Reports released by the FPI in October 2011 looked specifically at New York City and Long Island. The ethnic and community press covered both the national and local surveys. In more good news for small businesses, the number of them has been increasing over the past few years with more and more businesses looking for commercial office space for rent to kick start their business. This shows that not only are more immigrants starting their own business but more US citizens are confident enough in the economy to start a business too.

Korea Daily reporter Kisu Park looked at the numbers on Korean-Americans in the national report, and found a very high rate of business ownership among Korean immigrants (translated by Hyemi Lee):

Based on the analysis, 56,073 people from Korea are small business owners, making up 9.8 percent of the 573,202 people in the Korean-born working-age population.

This exceeds the overall percentage of immigrant business owners among the foreign-born labor force (3.5 percent), and that of other Asian countries such as Taiwan (6.8 percent), India (5.7 percent), and China (4.2 percent). While the number of working-age immigrants from China, Vietnam and the Philippines is higher by 200,000 to 500,000 people than the number from Korea, those communities’ small businesses ownership rates are only half that of the Korean community.

The country with the largest percentage of immigrant business owners among their workforce is Greece, at 16.1 percent. In contrast, Mexico, whose workforce includes nearly 7,600,000 people, has only slightly above 105,000 small business owners (1.4 percent).

Koreans account for 6 percent of all immigrant small business owners, coming in third below those from Mexico (12 percent) and India (7 percent.) However, as Koreans only account for only 2 percent of the entire immigrant labor force, it can be said that the ratio of Korean small business owners is very high.

The industries that have the highest rates of immigrant small business owners include taxi services (65 percent), dry cleaning and laundry services (54 percent), gas stations (53 percent), grocery stores (49 percent), miscellaneous general merchandise stores (47 percent), apparel manufacturing (45 percent), apparel wholesalers (44 percent), beer, wine, and liquor stores (42 percent), and nail salons (37 percent).

Juchan Kim of the Korea Times referred to a report done by the FPI in October 2011 that looked at small business ownership in New York City, which the Carib News also reported on at the time. The ranking for Koreans mirror their national standing. The excerpt below was translated by Hyemi Lee.

According to the Fiscal Policy Institute, in 2010 almost half of New York City’s small business owners (48 percent) were immigrants from other countries. Out of all immigrant small business owners in New York, the Chinese come in at the most. Koreans are third, below the Dominican Republic. India, Italy, Greece, Colombia, Former Soviet Union/Russia, Israel, and Jamaica round off the top 10.

Immigrant small businesses are of great importance to the following industries where they make up large percentages: Dry cleaning and laundry services (90 percent), taxi services (90 percent), grocery stores (84 percent), child day care services (75 percent), beauty salons (70 percent), restaurant services (69 percent), etc.

Reporter (and translator) Aleksandra S?abisz at Nowy Dziennik provided some Polish perspective on the data. Close to 17,5000 Polish immigrants own small businesses in the United States, making up 2 percent of all foreign-born small business owners. This puts the country in the top ten places of origin for small business owners. The numbers below, specific to Poles, can be found in the FPI’s supplemental data brief, “Immigrant Business Owners by Country of Birth.”

Immigrants from Poland specialize in small businesses that concern the construction sector. The Fiscal Policy Institute reports that there are 6,106 companies of this kind in the U.S. The second sector in which Polish entrepreneurs are widely represented is professional and business services (with 2,276 Polish-owned businesses of this kind, 620 of which offer building services). Some 1,402 small businesses owned by Polish-born small business owners operate in the transportation and warehousing sector, including 879 truck transportation companies. Another 1,334 are in the manufacturing sector, and 1,249 offer educational, health and social services, which includes 557 private practices.

According to Bogdan Karlowicz, operational manager at construction company JMB Transportation in Nazareth, PA, there may be more Polish-owned truck transportation businesses in the U.S. than the FPI estimates.

“In Chicago alone there are some 600-700 of them,” he said. “In Pennsylvania and New York – maybe up to 150.” He added that over 10 years ago, there were more Poles doing business in the construction sector, but owing to the economic downturn, many have now switched to transportation.

“At some point, there was little money in the economy for construction, and meanwhile the demand for transport never ends,” he said.

Mr. Karlowicz also adds that although competition on the market is tough, Polish-owned transportation companies often cooperate and help one another. JMB Transportation, which employs 15 truck drivers and seven office workers, offers general freight transportation for individuals and companies.

Foreign-born U.S. residents account for 13 percent of the country’s population and 16 percent of the labor force (Poles constitute 1 percent of the labor force in the U.S.), indicates data from the American Community Survey 2010. It is a significant change compared to data from 20 years ago, when immigrants constituted 9 percent of the labor force and owned 12 percent of small businesses in America.

What is interesting is that most immigrant entrepreneurs don’t have academic diplomas and their propensity to open up their own business increases the longer they stay in the U.S. Generally speaking, immigrants who have lived in the United States for over 10 years are more likely to open their own business than U.S.-born residents.

Janusz Sklodowski, owner of JMB Transportation, in front of one of his trucks. (Photo courtesy of JMB Transportation, via Nowy Dziennik)

Janusz Sklodowski, owner of JMB Transportation, opened the company after living in the U.S. for seven years. “Coming to the U.S. I knew I would own a business one day. But first I had to put some “starting” money aside, so I worked in construction,” said Mr. Sklodowski, who had his own business in Poland too.

In order not to oversee any important legal and tax aspects when opening up JMB, he used the services of an agency from Chicago, which specializes in establishing businesses in the truck transportation sector. Mr. Sklodowski admits that business-minded Polish immigrants can run very prosperous companies. “Having one’s own business is, however, a 24/7 job, regardless of how many people one employs,” adds Mr. Karlowicz.

Long Island Wins also covered this month’s FPI report while also referring back to another October 2011 study entitled “New Americans on Long Island: A Vital Sixth of the Economy,” which found that, “In addition to working professionals, immigrants also represent 22 percent of small business owners on Long Island, adding to our tax base, creating jobs, and providing services.” The article also links back to profiles of immigrant professionals:

As part of our partnership with the Long Island Business News, we’ve posted multimedia stories about a range of immigrant professionals on Long Island, including a heart surgeon who was once undocumented and a Korean artist whose language struggles led him to express himself through oil and canvas.

An El Diario/La Prensa article from October included other statistics in the study particular to Long Island.

According to the report, over half of immigrants on Long Island (54 percent) work in white-collar jobs while the other half work in so-called “blue-collar jobs” — with low salaries — or in agriculture or fishing and in forestry jobs.

On the other hand, not all is positive: immigrants earn lower wages than their American-born peers. And those who are undocumented have low-wage jobs.

However, a quarter of all small businesses (22 percent) are owned by immigrants, including almost half (44 percent) of all restaurants. Add to that the fact that more immigrants are of working age than the rest of the population.

The study also concludes that three-quarters of immigrants on Long Island are homeowners. And a third of them (32 percent) pay more than $10,000 a year in property tax.

With Long Island a suburb for well-off residents, immigrants that live there are all relatively wealthy. More than half of immigrants live in families with an annual income of more than $80,000. Nassau and Suffolk Counties are among the 50 wealthiest suburban counties in the US.

Another finding is that the greatest increase in the number of immigrants between 2000 and 2009 is found in Hempstead/Long Beach, while the fastest growth of immigrants is on the East End.

And, while in the United States as a whole, the majority of immigrants are Mexicans (with 30 percent), on Long Island no one immigrant group dominates. The primary countries of origin are El Salvador (12 percent), India, Italy, the Dominican Republic (with 5 percent each), Haiti, Colombia and Jamaica (4 percent each). Mexicans make up only 2 percent of the population.

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