The Big Story: Immigration reform is key for innovation, competitiveness
Pressure is building on lawmakers to address flaws in the country’s immigration system that keep the tech sector—including startups—from having the talent it needs. Following the recent passage of a sweeping competitiveness package, the Creating Helpful Incentives to Produce Semiconductors for America (CHIPS) and Science Act, members of the tech industry are calling to attention the need for immigration reform to keep the sector competitive.
Members of the semiconductor industry, who received a number of subsidies as a result of the CHIPS and Science Act, sent a letter this week calling on congressional leadership to invest in U.S.-born STEM talent and to reform immigration law so that highly-skilled foreign workers can remain in the U.S. and meet the U.S.’ STEM talent needs. The letter, signed by leading companies in the semiconductor industry, urges Congress to implement policy that would lead to the retention of foreign-born STEM talent, with an emphasis on graduates of U.S. universities. It calls for a Masters/PhD exemption for the statutory limitations for employment-based visas and green card recapture to ease the employer-sponsored green card backlog and to attach reforms to must-pass legislation, of which few vehicles remain. As the Biden administration forges ahead on innovative efforts—like microchip manufacturing—they must prioritize creating an immigration system that works for innovation.
While the CHIPS Act did include some provisions to support the innovation ecosystem, including through regional technology hubs, lawmakers rejected a provision from the House-passed version of the bill that would have created a visa specifically for startup founders. Overall, Congress has failed to adopt any immigration reform proposals that would bolster foreign-born STEM talent and support immigrant entrepreneurship in the U.S.
High-skilled immigration reform is essential for the innovation ecosystem. As we explained to lawmakers in a recent letter, startups need high-skilled immigration reforms and the creation of a startup visa. Immigrants are overwhelmingly entrepreneurial and critically fill gaps in our STEM talent pipeline. And over half of our nation’s billion dollar startups have an immigrant founder in spite of U.S. immigration law. But other countries with startup visas are competing for the innovative founders and talent that contribute to the robustness of our startup ecosystem.
Without an immigration system that works for entrepreneurs and innovation, the foreign talent required to maintain the U.S.’ competitive edge are opting for countries that are more hospitable. It’s essential that policymakers prioritize an immediate solution that will support the innovation ecosystem, not stifle it.
Policy Roundup:
Tech companies back affirmative action case. This week, Engine joined over 80 businesses in filing an amicus brief with the Supreme Court in support of efforts to promote student body diversity that are currently being challenged at Harvard and the University of North Carolina. In emphasizing campus diversity, universities are able to contribute to a robust and diverse workforce that leads to a stronger talent pool for innovative companies. Studies have shown how diverse teams lead to more and better innovation within the startup ecosystem and beyond.
EU countries threaten to undermine net neutrality in telecom proposal. This week France, Italy, and Spain called on the European Commission to create legislation that would force large technology firms to pay telecom companies based on the amount of Internet traffic they generate. Their effort follows comments from EU commission leadership and a telecom lobby report from earlier this year advocating for similar policy changes. Similar efforts have been rejected in the past, and critics have compared the proposal “to energy companies trying to collect fees from appliance makers for the energy use of washing machines, while consumers are already being charged for the actual amount of energy used to do their laundry.” Earlier this year, Engine joined civil society groups from across the globe in warning the EU about the consequences for EU net neutrality rules and the broader Internet ecosystem, should such a policy be pursued.
Proposed patent bills a mixed bag for startups. This week, two new patent bills were introduced in the Senate. Sens. Thom Tillis (R-N.C.) and Patrick Leahy (D-Vt.) introduced the Patent Examination and Quality Improvement Act of 2022 which is aimed at improving the patent examination process and the quality of patents issued by the USPTO. It calls for various government agencies to conduct a series of studies over the several years, and while it marks a step in the right direction, there are also other avenues to improve quality sooner. Separately, Senator Tillis also introduced the Patent Eligibility Restoration Act, which would relax the standards for patent eligibility and make it easier for a few companies to get and assert weak, overbroad patents claiming basic ideas of innovation and business. As we noted, that would unfortunately expose startups to more threats of litigation over low-quality patents.
India abandons privacy bill that would have stymied data flows. On Wednesday, the Indian government withdrew a proposed data protection and privacy bill that included rigid regulations on cross-border data flows and enabled the Indian government to seek user data from companies. Cross-border data transfers are critical to startups looking to operate abroad who cannot afford to build out data storage and processing infrastructure in each new country they enter. Startups and other stakeholders now await the new version of the bill—currently being drafted and slated to be enacted by early 2023—to see if it allays critical concerns that plagued the earlier proposal.
Startup Roundup:
#StartupsEverywhere: Los Angeles, California. Talyn’s eVTOL aircraft system is automating middle-mile cargo with aircraft that can take off and land without a runway. It utilizes two separate vehicles to bring aircrafts to a cruising altitude with 100 percent battery, allowing Talyn to fly faster and farther than its competitors, thus expediting the cargo delivery process. Co-Founder and CEO Jamie Gull spoke to us about his company, his experience working with various government entities, and his thoughts on the Small Business Innovation Research (SBIR) program.
