The Melting Pot That Isn't: Why America Needs Better Immigration

President Obama is putting immigration reform front and center on the political agenda, bringing together political, business, and religious leaders in a major White House meeting on Tuesday to focus on "fixing our nation's broken immigration system for our 21st-century economic and national security needs." But America's status as a magnet for immigrants already appears to be slipping, according to a new comprehensive measure developed by the British Council and the Brussels-based Migration Policy Group.

The Migration Integration Policy Index (MIPEX) rates the EU nations' (plus Norway, Switzerland, Canada, and the U.S. -- 31 countries in all) efforts to integrate immigrants according to 148 policy indicators, which range from opportunities for education and political participation to levels of protection against discrimination, from prospects for reuniting with family to the likelihood of achieving permanent residence status and citizenship.

For those keeping score, Sweden ranked first, Portugal second, and Canada third. The U.S. was ninth! The map below shows the scores for the 31 countries measured by the Index.

This new Index is an important advance in the way we measure openness to immigrants.  Previous studies, including my own previous work on the subject, for example, in The Flight of the Creative Class, gauge openness or tolerance by measuring the share of immigrants in the general population, or more commonly, with reference to surveys of attitudes toward immigrants, racial and ethnic minorities, or other excluded groups. The MIPEX measures something different and deeper -- the degree to which nations successfully integrate and proactively include immigrants. Still it is closely correlated with those other measures of openness and tolerance, such as Gallup surveys which measure openness to ethnic and racial minorities (.66) and to gays and lesbians (.68).

It's about more than generosity and big-heartedness. Immigrants are, in fact, key to economic growth and development, especially in our high-tech industries. Immigrants "have started 52% of Silicon Valley's technology companies and contributed to more than 25% of our global patents, according to Vivek Wadhwa, who has extensively studied the subject. "They make up 24% of the U.S. science and engineering workforce holding bachelor's degrees and 47% of science and engineering workers who have Ph.Ds." This is what venture capitalist John Doerr was talking about when he told an interviewer at the Web 2.0 Summit that America should "staple a green card to the diploma" of any immigrant who gets a degree in engineering.

In that spirit, I asked my colleague Charlotta Mellander to compare the MIPEX scores to a variety of other measures that have been seen to have a strong bearing on prosperity:  economic output, innovation, entrepreneurship, and the broader happiness of nations. With our usual caveat that our analysis only points to associations between variables, that we do not make any claims about causation, these scatter charts tell an intriguing story.

Nations that are more accepting of and better at integrating new immigrants have a higher level of economic growth and development. The MIPEX is closely correlated to a common measure of economic development -- the level of GDP per capita (.5). The MIPEX is also closely correlated with the UN's comprehensive measure of overall economic, social, and human development -- the  Human Development Index (.56).

Nations that are more immigrant-friendly have higher levels of overall economic competitiveness. The MIPEX is closely correlated to the Global Competitiveness Index developed by Harvard Professor Michael Porter and the World Economic Forum (.48).

Innovation is the underlying engine of economic development. And countries that are better at integrating immigrants are also more innovative. The MIPEX is closely correlated with the rate of patenting (.53)

The ability of countries to integrate immigrants translates into higher rates of entrepreneurship as well.  The MIPEX is closely correlated with a comprehensive measure of entrepreneurial activity -- the Global Entrepreneurship and Development Institute developed by Zoltan Acs and his collaborators (. 45).

So much for economic growth and development: But what about happiness and life satisfaction? Turns out, there is a close connection between the ability to integrate immigrants and the happiness of nations, too. The MIPEX and the Gallup World Poll's measures of happiness are closely correlated (.47).

Americans like think of their country as the world's great melting pot.  But this new immigration index and our analysis suggest that that's no longer an assumption that can be taken for granted.

While America's pundits and politicians obsess over the alleged social costs of illegal immigration, they should be worried that we may not always be the premier destination for legal immigrants, who bring the skills, energy and ambition that provide so much of the punch for the twin engines of innovation and entrepreneurship.  As Scott Page wrote in The Difference: How the Power of Diversity Creates Better Groups, Firms,  Schools, and Societies:

When we meet people who think differently than we do, who speak different languages, who have different experiences, training, and values, we should see opportunity and possibility. We should recognize that a talented "I" and a talented "they" can become an even more talented "we."

Nations that welcome the best and most diverse talent win, while those that close their borders to it fall further and further behind. The ability not just to attract immigrants but to integrate and effectively harness their skills is a key axis of global economic success, now and even more so in the future.

While the politics of immigration reform are likely weighing heavily on the president and his political team as they head into this reelection cycle, he must also take this opportunity to tell the world that America still stands as an open and welcoming location for ambitious, talented, and innovative immigrants who have done so much to propel its growth and prosperity.