Canadian Businesses owned by Immigrants more likely to innovate products and processes

The results of the Statistics Canada study were expected since Canadian immigrants are more likely to have studied STEM fields than Canadian-born residents. Small and medium-sized businesses in Canada that are owned by immigrants are statistically more likely to implement product or process innovation.

Immigrant business owners are 8.6% more likely to innovate a new product and 20.1% more likely to innovate in production processes or methods. They were also more likely to find new marketing methods. Organizational innovation was relatively the same for businesses owned by immigrants and the Canadian-born.

The two groups were broadly similar in their use of IP – Intellectual Property, although immigrants were more likely to have registered industrial designs when the results were adjusted for characteristics of the business and the owner. There was relatively little difference in terms of the use of intellectual property from patents, trademarks, trade secrets, and nondisclosure agreements.

Statistics Canada investigated whether a business owner’s immigration status affected whether a business would implement an innovation or own intellectual property. The study is part of a larger research project to better understand what leads to innovation and how innovation leads to success in Canadian businesses.

The results were collected using data from 2011, 2014, and 2017 versions of the Survey on Financing and Growth of Small and Medium Enterprises.

The results were consistent with the original study hypothesis, as immigrant entrepreneurs are more likely to be highly educated in science, technology, engineering, and mathematics. They are also more likely to trade internationally and file patents in the United States. These factors have shown a positive correlation with innovation.

The study found that immigrant-owned businesses seem more likely to innovate products or processes, whether or not they are a recent immigrant. The results were the same when examining whether the company was part of a knowledge-based industry or part of the economy as a whole.

The results may be partly related to unobserved differences between immigrant and Canadian-born owners, or they may reflect characteristics mainly observed among immigrants, such as doing business abroad and exposure to international innovations and technologies.

According to Statistics Canada, future research will further examine the sources of innovation for immigrants.

Reference is taken from CIC News