Something powerful jolted the U.S. economy in 1959. Fidel Castro's rise to power in Cuba started pushing hard-working, entrepreneurial people off the island. The talent flow continues to pay dividends for the United States nearly 60 years later.
Cuban refugees include former McDonald's president Ralph Alvarez, former secretary of Commerce Carlos Gutierrez and the late actor Desi Arnaz. Children of Cuban immigrants include Amazon founder Jeff Bezos, Washington Capitals and Wizards co-owner Raul Fernandez, and recent presidential candidates Marco Rubio and Ted Cruz.
The Cuban story is part of a broader pattern that has benefited the United States for generations. Other countries make value creators feel unwelcome and desperate to leave, while the U.S. beckons the same people with promises of liberty, individualism and opportunity.
That's the essence of the American brand, which pulled me from India as a young graduate student. Unfortunately, recent immigration policy and shifting public sentiment are threatening to flip the script. Rather than pulling talent from all over the world, America is rebranding itself as a place that pushes people away.
The reversal comes at a time when the country no longer has a monopoly on hosting big dreams. My nephew, a math and economics whiz from India, will make his mark in financial investment. But he doesn't see a need to study or work in the USA.
India, China and other countries that formerly pushed their talent out the door are giving people reasons to stay. Meanwhile, developed countries such as Canada are offering talented people reasons to come.
“Push” and “pull” factors are critical in entrepreneurship, based on new research I conducted with co-authors from the University of Illinois. We look specifically at what motivates aspiring entrepreneurs to quit their corporate jobs and strike out on their own, but similar dynamics drive the movement of people across borders.
Spinout founders sometimes leave their familiar environments in search of financial rewards, but their endeavors are usually associated with two aspirations: creative freedom and equity. These pull factors combine for wealth generation, creating a sense of fairness for contributions made. Similar forces bring fresh talent to America.
At least in the workplace, three main conditions push in the opposite direction. These include stifling bureaucracy, bad bosses and strategic disagreements. Working separately or in combination, the negative conditions contribute to the real push factor: lack of fit.
When talented professionals sense misalignment between individual and organizational purpose, they start planning their exits. This is also true for residents in a country, whether it is their birthplace or an earlier immigration destination.
Canada and Europe already are courting some of my colleagues affected by recent U.S. immigration policy. These are tenure-track professors with sharp minds, so they have options. Some turned down graduate school offers in other countries before choosing America precisely because they perceived it to be a strong fit on principles. Now they aren’t so sure.
Imagine receiving several job offers and choosing the best one based on firm reputation, only to find out later that your contributions aren’t appreciated. You probably wouldn’t stay long or recommend the employer to others. That’s how branding works. Individuals and organizations send signals about what they represent, and stakeholders use the information to make choices. Immigrants with high self-esteem and skills will similarly respond to the signals: “You belong,” or “get out.”
The international community is watching, but the greater risks will occur at home. Our research shows that organizational performance suffers when talented people leave to found their own firms.
That's partly because spinout founders function as ringleaders. They take the best people with them when they go. For countries that allow push factors to fester, the implication is a mass exodus of talent. That didn't work out well for Cuba.
A greater threat for the United States is loss of community as people increasingly view their neighbors with hostility. One naturalized citizen in my circle of friends, an endowed professor, is among many seeing the spillover effects of new immigration policy.
He now carries a passport to prove his U.S. status, but that does not stop the incivility. Dressed in a suit and tie while returning home from a conference, he was stunned when he entered a train car and a fellow passenger pointedly told him it was business class. Brand damage from such sentiment can take years to repair.
Vetting to keep potential criminals out is necessary, but countries that discourage immigration in the spirit of economic protectionism will suffer a double whammy — similar to the organizations we study. Not only will they will lose talent from within, they also will enable their competition from the outside.
Recent rhetoric invites Americans to push away, but the door to economic growth opens in the other direction. As someone who celebrates the entrepreneurial spirit in my country of choice, I implore: Keep pulling, America.