A previous version of this column referred to the “Start-Up Visa Act.” The correct name of the act referred to in the piece is Startup Act 3.0. This version has been corrected.
The saying goes, “there’s no such thing as a free lunch.” But the Startup Act 3.0, in its third incarnation, is starting to look a lot like an exception to the rule. The bill, introduced in the Senate, promises to jump-start the economy through the creation of new businesses. It provides visas for 75,000 foreign students and skilled workers to start companies. Individuals, in order to qualify, must already be in the United States on temporary visas. Their companies must receive an investment of at least $100,000 and employ a minimum of two U.S. workers in their first year, and five by the end of the third year.
The Ewing Marion Kauffman Foundation analyzed data on firm survival and employment from the Business Dynamics Statistics of the U.S. Census Bureau, and skilled-immigrant company-formation data that my research team, with funding from Kauffman, had previously gathered. Kauffman conducted the analysis to estimate how much the Start-up Visa, if adopted in its current form, could boost the economy. They released a white paper with their results Wednesday. Kauffman estimates that, conservatively, within ten years, a Start-up Visa could lead to the creation of between 500,000 and 1.6 million jobs-a potential boost to the economy of between $70 billion and $224 billion a year. That translates into a rise in GDP of between 0.5 and 1.6 percent, as computed using a methodology employed by the White House’s Council of Economic Advisors.