NCPA - National Center for Policy Analysis

Immigrants Help Communities Battle Recession

January 17, 2002

Some observers perceive a strong antidote to recession in areas throughout the country dominated by immigrants. The newcomers not only have a strong entrepreneurial streak and act as a counter-cyclical economic force by establishing businesses, but also their numbers stimulate demand.

  • Latinos, Middle Easterners and Asians, in particular, have had a salutary impact in parts of Houston, Los Angeles and Manhattan.
  • With their numbers expanding at a rate far faster than native-born Americans, immigrant-dominated groups provide a consumer market that -- according to a recent University of Georgia study -- expanded nearly twice as fast in the 1990s as the general population.
  • One Houston developer, himself an immigrant, estimates that roughly 60 percent of the businesses in his more than 30 suburban properties are occupied by immigrants.
  • Much of the eastern and southern reaches of the Los Angeles basin are dotted with shopping centers and factories operated by, and often owned by, foreign-born entrepreneurs -- particularly Latinos.

Significantly, both Houston and Los Angeles suffered grievously in the recession of a little more than a decade ago as Anglo homeowners and businesses folded or moved.

As Manhattan struggles with the aftermath of Sept. 11 and vacancies rise, immigrant neighborhoods like Flushing in Queens -- where an estimated 70,000 largely Asian immigrants have migrated since the early 1980s, continue to see increases in both occupancy and rents.

Source: Joel Kotkin (Pepperdine University), "Immigrants Cushion the Economic Fall," Wall Street Journal, January 17, 2002.

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