All over the world, many immigrants and their children have turned to small business when faced by the limited opportunities open to them in the labor market. For Israel, essentially a country of immigrants, worldwide experience in this area is of great significance. The recent wave of immigration from the former Soviet Union has greatly increased the Jewish population of Israel whereby new immigrants now constitute around 10% of the national work force. A rapid influx of immigration may lead to a political anti-immigrant backlash. Indeed, the current under-employment of the labor force and the competition for jobs have created a need for new employment opportunities: one possible solution is the promotion of entrepreneurial initiatives.
Our aim was to determine practical implications from the international and Israeli literature, for Israeli policy makers in the area of immigrant entrepreneurship. A theoretical background provides the justifications and frameworks of analysis for policy efforts in this area. A local economic development approach encompasses much of the policy supporting entrepreneurship and the contemporary development of entrepreneurial theory allows recognized entrepreneurial traits and problems to be identified. From this theoretical base and a review of entrepreneurial support elsewhere, this research analyses and describes common features of immigrant entrepreneurship. The entrepreneurial characteristics of the current immigrant wave are also described; on the basis of our own investigations together with other research from Israel and Russia.
Some general conclusions and policy recommendations from the international literature review include an emphasis on policy focus and coordination between different support initiatives. Specialization and the possible standardization and qualitative control of support are also recommended. Of particular significance to the Israeli context, of immigration from the former USSR, is the major role of interpersonal migration networks. Interpersonal networks between immigrants, immigrant communities and their origins may be the key to the phenomenon of immigrant entrepreneurship in Israel. In addition to the innovative and growth generating functions of entrepreneurship, immigrant businesses may provide additional labor market opportunities through their formation of an “immigrant economy”. Based on immigrant (migration) networks and the peculiarities of specific immigrant communities, this economy provides alternative development, complementary to the main stream economy.
