Strategies for Helping Growing Number of Immigrant Businesses

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A vendor hangs articles of clothing along 9th Street in the Italian Market neighborhood of Philadelphia. The market was featured in a new report that said states and cities have a stake in supporting immigrant-owned businesses because of their role in revitalizing neglected neighborhoods. (AP)

States and cities have a stake in encouraging and supporting the growing number of immigrant-owned businesses because of their role in revitalizing neglected neighborhoods, according to a report released this week by the Fiscal Policy Institute and the Council for the Americas, a business organization that supports free trade.

Success stories include the 9th Street Italian Market in Philadelphia, where Latinos have revived a district once declining as Irish and Italian shopkeepers retired, and the Midtown Global Market in St. Paul, where an abandoned Sears distribution center became a multicultural market.

“Immigrants are not magic ingredients to an economic development strategy, but they are an asset to the cities they join,” concluded the report called “Bringing Vitality to Main Street – How Immigrant Small Businesses Help Local Economies Grow.”

Immigrants are especially prevalent in small retail stores and services such as grocery stores, restaurants, car washes and beauty salons that the report calls “Main Street.”  The number of immigrant Main Street business owners grew by 90,000 since 2000 while the number of American-born owners shrank by 30,000.

Immigrants accounted for all the growth in Main Street businesses for most of the nation’s metro areas, including New York, Chicago and Dallas. Immigrants make about a quarter of the $50 billion generated annually by Main Street businesses, the report said, citing census data.

The report includes case studies from Nashville, Philadelphia and Minneapolis-St. Paul, where different strategies were assessed. All four cities, despite generally lower than average immigration, have been able to avoid population declines because of immigration, and all have a strong level of government support for immigrants.

Immigrant-owned small stores are now a majority in Los Angeles, San Jose, the District of Columbia and Miami. Nationwide, immigrants own most gas stations, dry cleaners and grocery stores, the study found.

Some of the report’s recommendations for states and cities interested in promoting this growth include:

  • Provide a welcoming climate for immigrants. Hostile legislation such as English-only laws can have a chilling effect.
  • Create a government office for immigration. The symbolism is powerful even when there are only a few staff members. Examples: Philadelphia’s Mayor’s Office of Multicultural and Immigrant Affairs and Nashville’s Mayor’s Office of New Americans.
  • Offer culturally competent training and services, such as in licensing and accounting. “There is a huge difference when these services can be provided in the language of immigrants.”  
  • Target problems faced by unauthorized immigrants:  “It makes sense for states and cities to do what they can to remove barriers for undocumented immigrants living in their communities.”
  • Take advantage of federal funding for refugee resettlement, and encourage banks to be more innovative when dealing with immigrant-owned businesses.
  • Foster incubators for small businesses, especially commercial kitchens, which can help immigrant food businesses meet the hurdles of health inspections.

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