Assisting our immigrant firms can open up the world
The rapid transformation of Ireland's demographic profile over the past decade through unprecedented levels of immigration has stimulated debate on the economic and social policy implications of the new multi-racial Ireland. One facet to this policy debate is the potential for non-Irish nationals to bolster business activity.
As foreign nationals currently constitute approximately 11pc of the Irish population, it is to be expected that their presence will increasingly come to be felt in terms of enterprise ownership. A 2008 nationwide survey of 1,108 foreign nationals resident in Ireland found that 12.6pc claim ownership or part-ownership of a business, while the 2011 Global Entrepreneurship Monitor (GEM) Report states that the overall rate for the whole adult population of Ireland is 8.6pc. Such research shows that for a variety of reasons, immigrants are more likely to start their own business than an Irish person.
In addition to being more entrepreneurial, the educational profile of non-Irish nationals ordinarily resident in Ireland shows a cohort of the population that has, on average, progressed to higher levels of education than the Irish population as a whole. It is also important to note the young age profile of immigrants which means that they are in an age bracket where statistically they are more likely to start their own business.
We therefore have within our population a very large group of people who are young, well educated, highly entrepreneurial and with established networks in foreign countries, but still we do not recognise them as an asset and a wonderful opportunity to expand our international trade.
When I have raised this issue in the past, the response that I normally received was that immigrant entrepreneurs are equally eligible to apply for any support programme that is available to indigenous entrepreneurs. However, a consistent finding in academic literature on immigrant businesses is their low propensity to use mainstream business support agencies, often relying instead on self-help and informal sources of assistance. Barriers to the take-up of support include: identifying and reaching marginalised groups, the inappropriateness of product-orientated approaches, doubts over the relevance of what is offered, and a lack of trust and confidence in those delivering support.
The extent to which the support needs of immigrant businesses are distinctive in comparison with those of 'normal' firms is also a key question. Although many of the support needs of immigrant businesses are shared with their majority counterparts, there are also specific issues that include language, religious, age, and gender aspects, and these have implications for the way business support is delivered if it is to be effective.
Immigrant entrepreneurs are also confronted with challenges in respect of starting and managing a business that are peculiar to their non-Irish status. These include a lack of business contacts, greater difficulty in accessing finance from institutional sources and an information deficit when it comes to negotiating the business regulatory and legal environments. Targeted intervention to directly assist aspiring foreign national entrepreneurs is commonplace in countries where immigrant populations are quite high, guided by economic growth as well as by social objectives.
What is required in Ireland is targeted intervention promoted through the social networks and media channels favoured by immigrants. Any such intervention should recognise the distinctive challenges faced by immigrant entrepreneurs, but should also appreciate the unique advantages that they can offer through their established networks in their home countries. At a time when Ireland is seeking to build its international trade across the globe, it appears that we have a wonderful resource on our doorstep that is not being proactively utilised.
Thomas M Cooney is Professor of Entrepreneurship at the Dublin Institute of Technology and president of the International Council for Small Business