No Deal

An immigrant exodus could hurt your bottom line.
Magazine Contributor
2 min read

This story appears in the November 2006 issue of Entrepreneur. Subscribe »

Fed up with what they see as federal inaction on illegal immigration, some cities and counties are taking the issue into their own hands. The sheriff in Butler County, Ohio, has threatened to arrest illegal immigrants. Hazelton, Pennsylvania, is revoking business licenses of companies that hire illegal immigrants and fining landlords who rent to them. What's getting lost, some say, is a discussion of illegal immigrants' buying power.

"When politicians say they're going to send back the immigrants, they don't realize that these 11 million to 20 million people are consumers," says Jorge Pinto, a professor of international business at Pace University in New York City. These restrictions have even legal immigrants lying low--and spending less with local businesses.

Multicultural management consulting firm Santiago Solutions Group estimates Hispanic consumers in the U.S. spent $700 billion last year. The U.S. Census also estimates that 40 percent of Hispanics living in the U.S. are foreign-born. "If 40 percent of [all Hispanic spending] is coming from immigrants, that's a massive amount of money," says Carl Kravetz of the Association of Hispanic Advertising Agencies.

This effect is already being felt in Atlanta, where realtors have noted an 80 percent drop in the number of Hispanics looking to buy homes since Georgia enacted stricter immigration laws. "Immigration has an impact on economic growth and on inflation," says Pinto. "The more these two variables become evident, the more pressure [there will be] on policymakers."

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