A largely invisible role of international students: Fueling the innovation economy

PITTSBURGH — Saisri Akondi had already started a company in her native India when she came to Carnegie Mellon University to get a master’s degree in biomedical engineering, business, and design.

Before she graduated, she had cofounded another: D.Sole, for which Akondi, who is 28, used the skills she’d learned to create a high-tech insole that can help detect foot complications from diabetes, which results in 6.8 million amputations a year.

D.Sole is among technology companies in Pittsburgh that collectively employ a quarter of the local workforce at wages much higher than those in the city’s traditional steel and other metals industries. That’s according to the business development nonprofit the Pittsburgh Technology Council, which says these companies pay out an annual $27.5 billion in salaries alone.

A “significant portion” of Pittsburgh’s transformation into a tech hub has been driven by international students like Akondi, said Sean Luther, head of InnovatePGH, a coalition of civic groups and government agencies promoting innovation businesses. Indeed, a neighborhood near Carnegie Mellon and the University of Pittsburgh has been dubbed the Pittsburgh Innovation District.

Since the second Trump administration began leveling visa crackdowns, funding cuts, and other attacks on higher education — including schools in Pennsylvania, a state that voted for Trump — much of the conversation about international students has focused on their importance to university revenues and enrollment.

But many of these students, especially in graduate schools, fill a less visible role in the economy. They conduct research that can lead to commercial applications, have skills employers need, and often start their own companies in the United States.

“The high-tech engineering and computer science activities that are central to regional economic development today are hugely dependent on these students,” said Mark Muro, a senior fellow at the Brookings Institution who studies technology and innovation. “If you go into a lab, it will be full of non-American people doing the crucial research work that leads to intellectual property, technology partnerships, and start-ups.”

Some 143 U.S. companies valued at $1 billion or more were started by people who came to the country as international students, according to the National Foundation for American Policy, a nonprofit that conducts research on immigration and trade. These companies have an average of 860 employees each and include SpaceX, founded by Elon Musk, who was born in South Africa and graduated from the University of Pennsylvania.

Whether or not they invent new products or found businesses of their own, international graduates are “a vital source” of workers for U.S.-based tech companies, the National Science Foundation reported last year in an annual survey on the state of American science and engineering.

That’s in part because comparatively few Americans study science, technology, engineering, and math. Even before the pandemic disrupted their educations, only 20% of college-bound American high school students were prepared for college-level courses in these subjects.

International students now make up more than a third of master’s and doctoral degree recipients in science and engineering at American universities. Two-thirds of U.S. university graduate students and more than half of workers in AI and AI-related fields are foreign born, according to Georgetown University’s Center for Security and Emerging Technology.

In Pittsburgh, international students are more than just contributors to the city’s success in tech. “They have been drivers” of it, said Dave Mawhinney, a professor of entrepreneurship at Carnegie Mellon and founding executive director of its Swartz Center for Entrepreneurship.

“Every year, 3,000 of the smartest people in the world come here, and a large proportion of those are international,” he said of Carnegie Mellon’s graduate students. “Some of them go into the research laboratories and work on new ideas, and some come having ideas already. You have fantastic students who are here to help you build your company or to be entrepreneurs themselves.”

Boosters of the city’s tech-driven turnaround say what’s been happening in Pittsburgh is largely unappreciated elsewhere. It followed the effective collapse of the steel industry in the 1980s, when unemployment hit 18%.

In 2006, Google opened a small office at Carnegie Mellon to take advantage of the faculty and student expertise in computer science and other fields there and at neighboring higher-education institutions; the company later moved to a nearby former Nabisco factory and expanded its Pittsburgh workforce to 800 employees.

Apple, the software and AI giant SAP, and other tech firms followed.

“It was the talent that brought them here, and so much of that talent is international,” said Audrey Russo, CEO of the Pittsburgh Technology Council.

At Carnegie Mellon, 61% of the master’s and doctoral students come from abroad, according to the university. So do 23% of those at Pitt, an analysis of federal data shows.

The city has become a world center for self-driving car technology. Uber opened an advanced research center. The autonomous vehicle company Motional — a joint venture between Hyundai and the auto parts supplier Aptiv — moved in. So did the Ford- and Volkswagen-backed Argo AI, which eventually dissolved, but whose founders went on to create the Pittsburgh-based self-driving truck developer Stack AV. The Ford subsidiary Latitude AI and the autonomous flight company Near Earth Autonomy also are headquartered in Pittsburgh.

Among other tech firms with homes in Pittsburgh is Duolingo, which has 830 employees and is worth an estimated $22 billion. It was cofounded by a professor at Carnegie Mellon and a graduate of the university who both came to the United States as international students, from Guatemala and Switzerland, respectively.

InnovatePGH tracks 654 start-ups that are smaller than those big conglomerates but together employ an estimated 25,000 workers. Now the University of Pittsburgh and others are developing Hazelwood Green, which includes a former steel mill that closed in 1999, into a new district to house life sciences, robotics, and other technology companies.

In a series of webinars about starting businesses, offered jointly to students at Pitt and Carnegie Mellon, the most popular installment is about how to found a start-up on a student visa, said Rhonda Schuldt, director of Pitt’s Big Idea Center, in a storefront on Forbes Avenue in the Innovation District.

Some international undergraduates continue into graduate school or take jobs with companies that sponsor them so they can keep working on their ideas, Schuldt said.

“They want to stay in Pittsburgh and build businesses here,” she said.

There are worries that this momentum could come to a halt if the supply of international students continues a slowdown that began even before the new Trump term, thanks to visa processing delays and competition from other countries.

Further declines are expected following the government’s pause on student visa interviews, publicity surrounding visa revocations and arrests, and cuts to federal research funding.

No international Pitt students are known to have had run-ins with Immigration and Customs Enforcement, a spokesperson for the university said. Carnegie Mellon has been asked to provide information to the House Select Committee on the Chinese Communist Party about its links with Chinese universities and research institutions, its international students, and those students’ participation in research. None of its students had been confronted by ICE as of the end of the spring semester, the university has said.

Pitt reports that 60% of its alumni stay in Pennsylvania and represent “an indispensable talent pipeline,” especially in biomedical research and advanced manufacturing. Carnegie Mellon says more than 400 start-ups have been created by its students and faculty since 2010, worth a combined $25 billion; it says 64% of all the graduates of its National Robotics Engineering Center stay in Pittsburgh.

Students and faculty at the 11 principal colleges and universities in Pittsburgh combined have launched an average of more than 30 businesses per year since 2017, according to the Pittsburgh Council on Higher Education.

The universities, the city, and local business and higher-education associations don’t break out how many of these were started by international students. But the Swartz Center for Entrepreneurship at Carnegie Mellon University has made 134 investments in start-ups with student founders over the last 10 years, and 36% of those, or 48, had at least one founder who was an international student. Of those, 25 were Pittsburgh-based.

Local tech companies with founders who came to Pittsburgh as international students include CEI, Vivisimo, FORE Systems, Near Earth Autonomy, Accion Labs, Logix Guru, JetStor, Adrich, and Voaige.

It’s too early to know what will happen this fall. But D.Sole co-founder Akondi has heard from friends who planned to come to the United States saying that they can’t get visas. “Most of these students wanted to start companies,” she said.

Akondi has been accepted into a master’s degree program in business administration at the Stanford University Graduate School of Business in California under her existing student visa, though she said her company will stay in Pittsburgh.

“I think we’ll see almost immediate ramifications in Pittsburgh in terms of higher-skilled, higher-wage companies hiring here,” said Luther, at InnovatePGH. “And that affects the grocery shops, the barbershops, the real estate.”

There are other, more nuanced impacts.

“Whether we like it or not, it’s a global world. It’s a global economy. The problems that these students want to solve are global problems,” Schuldt said. “And one of the things that is really important in solving the world’s problems is to have a robust mix of countries, of cultures — that opportunity to learn how others see the world. That is one of the most valuable things students tell us they get here.”

Pittsburgh is a prime example of a place whose economy is vulnerable to a decline in the number of international students, said Brookings’ Muro. But it’s not unique.

“These scholars become entrepreneurs. They’re adding to the U.S. economy new ideas and new companies,” he said. Without them, “the economy would be smaller. Research wouldn’t get done. Journal articles wouldn’t be written. Patents wouldn’t be filed. Fewer start-ups would occur.”

The United States, said Muro, “has cleaned up by being the absolute central place for this. The system has been incredibly beneficial to the United States. The hottest technologies are inordinately reliant on these excellent minds from around the world. And their being here is critical to American leadership.”

This story about international students was produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education.