In a recent article, I highlighted the likelihood that immigrants will become entrepreneurs. This likelihood is generally a combination of the fresh perspective immigrants bring together with the challenges they face in securing more regular employment.
While this heuristic is true in most countries, recent research from Harvard highlights that it’s not true for all immigrants. Instead, the study argues that immigrants are far more likely to become entrepreneurs if they migrate when they’re relatively young.
Entrepreneurial sweet spot
We often associate entrepreneurship as the preserve of the young, who are not yet wedded enough to the status quo, so can look upon a situation with fresh eyes. Indeed, in Organizing Genius, Warren Bennis argued that some of the most innovative teams in history typically had people in their mid 20s in them.
When we look at the entrepreneurial landscape today, however, we tend to trend towards an older demographic. For instance, research from MIT and Kellogg found that entrepreneurs in their 40s tended to get the most financial support from VCs. This was supported by research from Penn State, which showed that older entrepreneurs tend to be successful because of the range of life experience they can tap into.
This isn’t the case for immigrant entrepreneurs, however, as author William Kerr found that the most successful migrate in their teens. Kerr discovered this after analyzing the final wave of migration after the Vietnam War in the 80s and 90s. The Amerasian Homecoming Act (AHA) allowed around 25,000 children of Vietnamese mothers and American fathers to migrate to the United States.
The study found that the age of these youngsters played a key role in their success, with younger immigrants outperforming their older peers. Indeed, youngsters who migrated between 14 and 17 were typically more successful than those who migrated between 18 and 21. These advantages were fairly universal, with the younger migrants doing better in school, their careers, their language fluency, and their lifetime income.
Unique circumstances
Kerr acknowledges that this cohort is perhaps unlike other types of migrant, as they were given immediate right to work upon arrival, which is not something all migrants enjoy. This legal basis played a significant role in their subsequent success.
Their success is still notable, however, not least as expectations were incredibly low. Indeed, reports at the time remarked that the young migrants were uneducated and often unwanted by their host communities.
The researchers were able to track the career trajectories of the migrants because their arrival coincided with the creation of the Longitudinal Employer Household Dynamics (LEHD) database by the US Census. This provided anonymous career data for people, including their job titles and income.
Making progress
In total, the researchers tracked around 60,000 individuals who were aged between either 14 and 17, or 18 and 21. The analysis revealed a couple of clear trends. Firstly, younger immigrants nearly always tended to live in households with very low incomes. Indeed, the norm was for households to live on just 45% of the regional average income.
Despite this disadvantaged beginning, however, those younger migrants typically surpassed their older peers. Indeed, by 2019, they were found to earn 106% of the local average, compared to just 90% for those from the older cohort.
Younger arrivals were also found to be more likely to marry a spouse who was either college-educated or a US native (or both). Similarly, older migrants showed lower levels of education and language fluency than their younger peers.
Professional status
The younger cohort wasn’t just more likely to become entrepreneurs either, as the data found that they were also more likely to hold a variety of professional roles, from dentist to engineer. What’s more, for those who did take the entrepreneurial route, the younger cohort was less likely to follow a traditional path into the nail care sector.
Looking at how different countries handle refugee and asylum-based migration shows that even older refugees tend to do quite well in the long run. The outcomes for these groups are influenced by many factors, making it hard to pin down a single reason for their success.
Refugees are different from other immigrants because they usually plan to stay in the United States permanently. Unlike those who come to earn money to send home or international students who return when their visas expire, refugees aim to build a life here. In the early years of the American Humanitarian Admissions (AHA) program, about 95 percent of applicants were approved, reflecting a more open approach to immigration at that time.
“There’s a lot that we need to continue to explore and learn about from that vantage point,” the authors conclude. “Were there particular traits of this wave that were advantageous for this group? Did they land in a particular city that was overall more beneficial, or did they have a particular type of early career experience?”
