Immigrants' Role in the Small Business Economy Grows - Businessweek Immigrants' Role in the Small Business Economy Grows - Businessweek

Thursday, June 14, 2012

Immigrants' Role in the Small Business Economy Grows - Businessweek

Immigrants' Role in the Small Business Economy Grows - Businessweek

The share of U.S. small businesses owned by immigrants has expanded by 50 percent since 1990, with almost one-fifth of business owners born outside the country, according to a new report (PDF) by the Fiscal Policy Institute.

The number of foreign-born business owners has increased in tandem with the immigrant workforce. Immigrants made up about 9 percent of workers in 1990 and 12 percent of business owners with fewer than 100 employees, according to the report, which analyzed U.S. Census data. In 2010, the foreign-born share of the workforce had grown to 16 percent, and immigrants made up 18 percent of small business owners.

“It’s gone from a modest size of business owners to a pretty substantial size of business owners,” says David Dyssegaard Kallick, a fellow at the institute who authored the report.

The conversation around immigrants’ role in the economy is often dominated by two oversimplified ideas, he says. Immigrants are either seen as strictly in competition with native-born workers for jobs, or immigration is seen as magic bullet to revive stagnant economies. While the impact of immigrants on job growth can be overstated, he says, “people sometimes don’t realize that when immigrants come into the economy, the economy also grows.”

Immigrants from the Mediterranean and Middle East had the greatest rate of business ownership. At least 10 percent of workers from Greece, Israel, Syria, Iran, Lebanon, Jordan, and Italy were business owners, according to the report. The most common types of businesses were service enterprises, such as restaurants, doctors’ offices, real estate companies, and retail stores.

Stocks rise on hopes for Fed action - CBS News

(CBS/AP) NEW YORK - The stock market surged Thursday after a tame inflation reading and another weak jobs report raised expectations that the Federal Reserve is closer to offering more support for the U.S. economy.

The market had a temporary surge late in the day after Reuters reported that major central banks were preparing for coordinated action to prop up financial markets in the event that Greek elections this weekend cause tumultuous trading.

The Dow Jones industrial average jumped about 100 points after the report came out and closed at 12,652, up 156 points. The Standard & Poor's 500 increased 14 points to 1,329. The Nasdaq composite gained 18 points to 2,836.

Low prices, weak hiring raise odds of Fed action
Weekly jobless claims rise to 386.000
U.S. futures volatile after sluggish job numbers

Applications for unemployment benefits rose last week, according to the latest government report. The four-week average increased for a third straight week, another sign that the jobs market remains weak.

The government's main measure of U.S. consumer prices fell in May by 0.3 percent, the biggest drop since December 2008. Analysts said the slowdown in price increases could make it more likely that the Fed will announce new steps to boost the economy when it meets next week. Low inflation gives the Fed more leeway to inject money into the financial system, keep interest rates low and encourage borrowing.

"The markets are higher, I think, because there are enough investors who believe that this morning's data on prices and jobless claims increase the case for more Fed easing as soon as next week's meeting," said Clark Yingst, chief market analyst at the securities and banking firm Joseph Gunnar.

Yingst said the market could easily switch directions in the coming days. "Traders are just following the trend one way on one day, but are perfectly happy following it the other way the next."

The gains were broad. Nine of the 10 industry groups in the S&P 500 made gains and more than two stocks rose for every one that fell on the New York Stock Exchange.

Just the whiff of another round of help from the Fed has been enough to shoot stocks higher in recent weeks, but the gains often disappear as quickly as they arrive. Last Wednesday, the Dow posted its best day this year, surging 286 points. Comments from a Fed official that hinted at more stimulus helped launch the rally.

The rally fizzled the next day, however, after Fed Chairman Ben Bernanke told a closely watched Congressional hearing that no new steps were being contemplated at the moment.

The question of will or won't the Fed act next week is top of mind for investors. The Fed's latest round of bond purchases winds down at the end of this month, and market players wonder whether a third is on the way, or if the current program might be extended. By making trillions of dollars' worth of bond purchases, the Fed helps keep interest rates ultra-low and encourages investors to put money into other assets, like stocks.

"Ultimately, all that matters for investors right now is whether these developments mean the Federal Reserve is more or less likely to ease policy in order to support what they may see as an insufficiently strong economic recovery," said Dan Greenhaus, chief global strategist at the brokerage BTIG, in a note to clients.

In Europe, borrowing rates for Spain touched a record high Thursday after the rating agency Moody's cut its credit rating to one notch above junk status. Spain's benchmark 10-year bond hit 6.96 percent before pulling back.

US STOCKS-Wall St rises on news central banks primed to act - Reuters UK

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