The Exit and Survival Patterns of Immigrant Entrepreneurs: The Case of Private Incorporated Companies

This paper addresses two questions. First, do duration and exit patterns of firm ownership differ between immigrant and Canadian-born entrepreneurs? Second, what immigrant characteristics are associated with lower exit rates and longer ownership spells? The paper focuses on new spells of ownership of private incorporated companies that started between 2003 and 2009. On average, there was little difference in the duration of ownership between immigrants and the Canadian-born. Seven years after taking ownership, 56% of immigrants and 58% of the Canadian-born were still owners. In both cases, the exit rate from ownership was highest at the beginning of the ownership spell and declined rapidly with years of ownership. Exit rates were marginally higher among immigrant business owners during the first three years of ownership, but there was no difference between the two groups thereafter. However, recent immigrants (those in Canada for less than 10 years) had significantly shorter ownership spells than the Canadian-born or longer-term immigrants. Duration of ownership spells generally varied by age, source country and industry. Education had only a small effect on firm duration and exit rates. Among recent immigrants to Canada, business immigrants had the highest exit rates and shortest duration of ownership. However, among longer-term immigrants (those in Canada for 10 years or more), exit rates and the duration of ownership varied little across immigrant categories, which included refugees and family class, economic and business immigrants.

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