Immigrants play big role in the Maryland economy

By Jonathan Capriel
Immigrants account for about a third of new companies founded in the United States

Eshhaq Rafiq's parents fled Afghanistan for the United States during the Soviet occupation of that country. Mei Xu left China after the university student was assigned to warehouse work for re-education after the Tiananmen Square crackdown. Juan Barbaran came to America from Peru, seeking new opportunities after the promising soccer player broke his leg in a match.

The three, who came from different places and different circumstances, all wound up opening businesses to pursue the American Dream. They are among many foreign-born entrepreneurs in Maryland and nationwide who are creating jobs and boosting the economy.

Immigrants were almost twice as likely to start a company as U.S.-born citizens in 2014, according the Kauffman Foundation. In that year, immigrants started nearly a third of all new companies in the country. And nearly all of the new jobs in the United States were hires made by companies less than five years old, said Jason Wiens, policy director at Kauffman.

"When it comes to creating jobs, the age of the company is more important than size," he said. "Everyone is looking for a way to grow the economy. Welcoming more immigrants and creating more avenues for them to come into the country is a way we could put Americans back to work."

Jason Richwine, a conservative public policy analyst, counters that immigrant entrepreneurship numbers are overstated. In a blog post on the website for the Center for Immigration Studies, he cites self-employment data indicating that among adults age 25 and older, 11.4 percent of immigrants are self-employed, compared to 11.1 percent of native-born Americans.

"Even to the extent that brilliant, tech-savvy immigrants are boosting our economy, that is a case for the limited entry of 'Einsteins,' not for mass immigration," Richwine wrote.

In Baltimore, foreign-born residents make up 9 percent of the city's population but own nearly 21 percent of the city's businesses, according to a 2012 report from the Fiscal Policy Institute.

This doesn't mean Americans are less entrepreneurial than people from other countries, but immigrants to the United States tend to be risk-takers, said Rajshree Agarwal, professor in entrepreneurship and director of the Ed Snider Center for Enterprise and Markets at the University of Maryland.

"The very fact that they chose to leave their home country and go to another shows some abilities, aspirations and risk-taking that makes them different from people in their home country," she said.

Rafiq was 2 years old when his parents fled Afghanistan, receiving refugee status in the United States in 1988.

"The only thing we brought from Afghanistan was the luggage we could carry," he said.

With no money, limited English and five children to support, Rafiq's father, Kaseem Rafiq, worked at gas stations and convenience stores. The family saved enough money to open their first restaurant in 2005.

Rafiq worked at the restaurant, manning the cash register and watching his father cook, as a teenager and also while earning a degree in information systems from the University of Maryland, Baltimore County.

After Rafiq graduated, he didn't have much interest in working for someone else.

"I wanted a degree as a backup," he said. "The way we were raised was to be entrepreneurs. We believe that if you want to succeed you have to do something on your own."

Like his father, Rafiq saved up and, early last year, opened his own restaurant, Maiwand Grill, a fast-casual restaurant on West Baltimore Street downtown. While the menu is halal (prepared in accordance with the tenets of Islam), most of Maiwand Grill's customers are neither Muslim nor Afghan.

"Back when my father started, ethnic food wasn't so popular," the 30-year-old said. "That's changed. I think we are appealing to people who want to come in [and] have an upscale lunch at a reasonable price."

The restaurant serves about 150 customers during the lunch hour and employs 20 people.

"We are doing pretty well," he said.

Many immigrant entrepreneurs, like Rafiq, are in the service industry. In 2013, more than 40 percent of the retail and food service businesses in the Baltimore and Towson areas were owned by people born outside the United States.

But some like Xu found their callings in different industries. After coming to America to study journalism at the University of Maryland, Xu and her then-husband founded Chesapeake Bay Candle in 1994. The company has since sold more than 300 million candles and reported sales of $52 million last year.

The company opened a Glen Burnie factory in 2011, which produces over half a million candles a month and employs about 135 people.

Immigrant-owned businesses in Maryland generated a net income of $2.8 billion between 2006 and 2010, the most recent data available, according to Robert Fairlie of the University of California, Santa Cruz.

Growing up in Hangzhou, China, a city two hours away from Shanghai, Xu didn't imagine she would start a multimillion-dollar candle company in Maryland. In fact, she was on track to work for the Chinese government.

She was set to graduate from the Beijing Foreign Studies University in 1989 and anticipated landing a yearlong job at the World Bank or a similar organization, she said.

"At that time you were assigned a company, usually state-owned or a joint venture organization," she said. "All my classmates had been assigned a job."

But a month before Xu graduated, the government cracked down on student protesters in Tiananmen Square in Beijing, injuring hundreds and killing an unknown number. The government reassigned graduating students to less glamorous jobs that year as a form of re-education, Xu said.

"The graduates that year were sent to work with workers, farmers and the army," she said. "They wanted to alienate us from other students."

Xu ended up in a minerals warehouse. She worried that her language skills would decay if she stayed. So she headed to the United States.

"Leaving that job meant that I gave up my career in China, not to mention ending any possibility to start a regular job," she said.

Xu said she has never been worried about her future, even when she left China.

"Growing up in a very impoverished country, where there really wasn't anything, I was used to having nothing," Xu said. "When you have nothing, there is nothing to lose."

Barbaran was 21 years old and thought he'd lost everything when doctors told him he would never play soccer again after his leg was broken in a match against a rival university in Peru. He soon began looking for a different way to make a living.

With a small loan from his uncle, Barbaran moved to the United States, where he spent several years as a dishwasher at a Cuban restaurant while he learned English at the Community College of Baltimore County.

"Sometimes it wasn't fun at all," he said.

Two years ago, Barbaran established Juan of a Kind Foods with his wife. Barbaran said he has a "passion for guacamole," but it's their hot sauce — made from Peruvian aji amarillo peppers — that is catching many people's attention.

Now, Juan of a Kind Foods' hot sauce can be found in three restaurants in town, and whenever Barbaran sets up his tent at the Fells Point Farmers' Market.

"We are taking baby steps," said Barbaran, 38, who graduated from the University of Baltimore with a degree in business administration. "That allows me the opportunity to do things the right way."

Every Friday night, Barbaran, who continues to work full time with Paychex Inc., will cook the peppers and bottle the sauce from 10 p.m. to 2 a.m. at an industrial kitchen he rents from a church in Gambrills. With the help of his wife, they can fill 60 bottles an hour.

It's been a long path, and Barbaran knows he still has a long way to go to make it.

"But in the meantime, I knew it was all part of the American dream," he said. "No one was going to offer me a job because I used to play soccer."

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