Promoting ethnic businesses and entrepreneurship can help newcomers integrate

Immigrant entrepreneurs and ethnic retailers are a vital part of Canadian society. According to researchers at Ryerson, supporting immigrant entrepreneurs can improve the economy, build immigrant success and knit communities together.

School of Urban and Regional Planning professor Zhixi Zhuang examined over 110 suburban ethnic retail clusters in the Greater Toronto Area, in particular Chinese and South Asian retail areas in gateway communities such as Scarborough, Etobicoke, Mississauga, Brampton, Markham and Richmond Hill. She conducted focus groups in the case study areas with community leaders and residents, performed customer surveys and interviewed merchants, developers, architects and city officials.

Professor Zhuang’s research demonstrated that ethnic retailers’ contributions go beyond the standard engagement of business to customer. When she looked at immigrant entrepreneurs in various ethnic retail clusters, she found that these storefronts shaped the suburban landscape, provided gathering spaces and created a strong sense of ownership for those specific ethnic communities.

However, she also found a lack of planning at the city level to accommodate these types of retail spaces. “We take it for granted that we are a multicultural city,” she said. “These spaces make a lot of economic and social contributions. And they can serve as a gateway for better community building and inclusion. If we don’t help newcomers integrate, we will lose this unique ethnic capital.”

Supporting these communities through good urban planning is what professor Zhuang is recommending in her work. Cities need to take into account the importance of “ethnic anchors” and incorporate them into city planning. When local residents can receive services in a familiar language, buy products from their homeland and interact with other people from different communities, the result is a community for social interaction and public sharing beyond the co-ethnic community. These sites have been shown to regenerate lagging business areas and to provide diversity in suburban settings, suggesting that urban planners should consider these types of business clusters as a benefit to communities.

“We must think ahead to what kinds of initiatives, measures or outreach activities could help build the communities as a whole and promote intercultural understanding,” said professor Zhuang.

Giving ethnic entrepreneurs a leg up

Given the importance of entrepreneurship to driving innovation and economic growth, the contributions of immigrant entrepreneurs must also be recognized and better supported, according to professor and director of Ryerson’s Diversity Institute Wendy Cukier.

In one of the largest studies of immigrant entrepreneurs in Ontario, professor Cukier interviewed 240 entrepreneurs in Toronto, Mississauga, Niagara and Picton. Her survey demonstrated that entrepreneurship is a vital piece of the employment puzzle for newcomers in both small and large communities and confirmed that immigrants are more likely to choose entrepreneurship than Canadian-born individuals. While some newcomers are “pushed” into entrepreneurship because of barriers to traditional employment or difficulties getting credentials recognized, more are “pulled” into entrepreneurship, perceiving it to be a desirable career path.

Among the study’s respondents, few came to Canada through entrepreneurship or investor class immigration. “Most come through the family class,” noted professor Cukier. Immigrant entrepreneurs are also more likely to export than their Canadian counterparts. At the same time, her study showed that immigrant entrepreneurs face more barriers to supports and access to government funding than Canadian-born entrepreneurs. The lack of culturally sensitive support for entrepreneurs in government-funded programs creates unintended barriers.

“For example, The Dragon’s Den model of pitching is one which many government-funded business incubators rely on,” said professor Cukier. “It is great theatre, but it is a very Western approach, and it doesn’t necessarily help identify who is going to be a successful entrepreneur.”  

The study concluded that more flexible services and better supports for immigrants to pursue entrepreneurship need to be provided by settlement agencies and entrepreneurship service providers.

“The traditional model is that newcomers must learn English before they can be placed in employment and often entrepreneurship is not even an option that is considered. Yet most of the newcomers did not believe that language was a barrier to starting a business,” said professor Cukier. “It seems counterintuitive, but we see that many are eager to start working and we need to consider new models of work-integrated learning which include entrepreneurship.” For example, professor Cukier and the Diversity Institute partnered with the Scadding Court Community Centre in Toronto on its Business Out of the Box retail incubator for newcomers.

Additional recommendations in the  (PDF file) report included easier access to information and better coordination of services. The Diversity Institute is also partnering with a variety of stakeholders to create an online portal aggregating resources available to support immigrant entrepreneurs.

Research from professors Cukier and Zhuang illustrates the importance of supporting ethnic businesses and immigrant entrepreneurship for the benefit of communities and economic prosperity.

Professor Zhuang’s research is supported by a Social Sciences and Humanities Research Council of Canada Insight grant.

Professor Cukier’s research was funded by the Government of Ontario and the Ministry of Citizenship and Immigration through the Ontario Bridge Training Program for Internationally Trained Individuals.