How Trump’s DACA Action Could Affect Foreign-Born Entrepreneurs

In a free market economy, the efforts of entrepreneurs from all walks of life fuel the market. Because small business make up over 99% of U.S. employment firms, it’s important that anything that might affect this demographic be taken seriously.

As the Trump administration makes moves against immigration policies such as DACA, we need to closely analyze the impact it might have on entrepreneurship in the United States.

What Is DACA?

DACA, or the Deferred Action for Childhood Arrivals, is an immigration policy that protects certain immigrants who entered the U.S. illegally as children from deportation for two years. DACA was implemented by the Obama administration in 2012 and has over 800,000 enrolled applicants.

To be considered eligible, an applicant must:

• Have come to the U.S. before their 16th birthday.
• Have been less than 31 years old on June 15, 2012.
• Not have been lawful immigrants or nonimmigrants on June 15, 2012, meaning that they are not under any visa or green card and are in the U.S. illegally.
• Either have graduated high school, have a GED, be enrolled in school, or have been honorably discharged from the U.S. military.
• Must have lived in the U.S. continuously since June 15, 2007.

Applicants who meet all of these criteria can remain in the U.S. without fear of deportation for two years. DACA also allows eligible candidates to obtain Employment Authorization Documents. Once that two-year period is over, the applicant has the opportunity to renew their deferred action indefinitely.

This was created to allow those who came to the U.S. illegally as children to remain here. Many have come as infants and consider the U.S. to be their home. Some might not even know their native language.

The Obama administration tried to expand DACA to include parents as well (DAPA) and to give all eligible candidates a direct pathway to legal permanent residency (green card status).

How Have States Responded?

The county seems to be divided down the middle on this issue, as 26 states believe this to be an unconstitutional breach in the president’s authority. In 2014, those states sued the United States in an effort to stop the expansion of DACA. Other states, like California, Illinois, and Maryland, are giving provisions to DACA-eligible immigrants such as driver’s licenses and federal health insurance.

What Is President Trump Doing About DACA?

President Trump made his position on DACA clear during his campaign: he does not support it and intended to repeal it as soon as possible. Now, almost a year into his presidency, DACA has been repealed.

The Trump administration attributes the repeal to the threat that several states would sue, thus stopping DACA regardless. For this reason, six months have been given for Congress to develop a plan that would please all sides. After this time, DACA recipients may be subject to deportation.

Many people take issue with this because DACA caused many illegal immigrants to step out into the light and trust the proverbial olive branch extended by the government. Now that the program has been rescinded, the exposed immigrants are now prime targets for deportation.

However, those who oppose DACA are taking equal issue with a noted rise in unaccompanied minors crossing the border illegally from Mexico into the U.S. A series of “coyotes,” or cartels, have reportedly sprung up in response to DACA with the intention of ferrying teenagers into the U.S.

How this Affects Entrepreneurs

According to a report by the New American Economy, immigrants have started over 3 million businesses in the U.S. Because of all the ways that immigrants can start businesses in this country, it’s no wonder why foreign-born entrepreneurs play such an important role in our economy.

DACA, if it had been able to grow, would have greatly increased the number of immigrants who entered the U.S. illegally as children who could live and work freely. Due to its fledgling state and constant legal issues, only 800,000 immigrants were able to take advantage of it. While this is no small number, it is only a fraction of the number of new entrepreneurs this country could have housed.

In a 2016 study conducted by several organizations including the University of California and the Center for American Progress, 1,308 DACA recipients were surveyed about their jobs before and after being admitted to the program. According to the survey, over 95% of the recipients are employed and almost 50% were able to change jobs to improve their wages and working conditions.

However, one of the most startling impacts comes from the entrepreneurs. Based on the results from the study, over 6% of those surveyed went on to start their own businesses once they had access to the Employment Authorization Documents that DACA provided. Compare that to the percentage of U.S. citizens and legal immigrants who become entrepreneurs—which is 3.1% and 3.6% respectively. It’s clear that DACA could have facilitated a growing number small businesses.

Sweeping moves on the parts of both the Obama and Trump administrations have greatly impacted the immigration policies in the U.S. and subsequently the U.S. economy as a whole. Whether you are for or against DACA or any other policy that provides legal protection for illegal immigrants, great care must be taken as everything from taxes to the job market are heavily affected by this nation’s immigrants.

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from Fundera Ledger https://www.fundera.com/blog/daca-foreign-born-entrepreneurs