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Over the course of her career, Ms. Alice Yardum-Hunter has given many speeches and has published numerous articles to the lay and professional attorney reader alike. The writings and speeches published here and elsewhere are a sampling of her works.
These publications are made available for your personal edification, but are copyrighted and may be used or reprinted only with permission.
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H-1B Cap Threatens to Stall High Tech Firms
5/1/1998
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by Alice M. Yardum-Hunter
published in HR News by the Society for Human Resource Management |
A widespread shortage of skilled workers in the high tech and other professional fields may keep U.S. companies from hiring the workers they need if those workers are not U.S. citizens or permanent residents.
The H-1B visa, which allows U.S. companies to hire foreign professionals on a temporary basis for up to six years, is arbitrarily capped at 65,000 per year. Currently, the cap is slated to be reached by early May. Unless Congress passes, and the President signs legislation increasing the number of visas available, human resources managers will be forced to postpone their H-1B hiring until October 1st or later. This will result in critical projects being postponed, workers being laid off, and profits forfeited. U.S. companies in every field will be affected.
A Senate bill would lift the cap to approximately 90,000 visas or more for the next five years. But controversy swirling around the legislation could spell its doom. Immigration is always a controversial subject. Even when the competitiveness of the American economy is at stake, proponents of immigration are viewed with suspicion and distrust.
The high-tech labor shortage has been well-documented by industry groups such as the Information Technology Association of America (ITAA) and the American Electronics Association (AEA). For the past several years, these groups and regional high-tech alliances have reported that the industry has hundreds of thousands of unfilled positions available. Many companies have turned to H-1B employees to fill the gap. Shortage is widespread.
Even companies that aren't in the technology field are being squeezed by the shortage: the National Association of Manufacturers, the U.S. Chamber of Commerce and the National Federation of Independent Business all report that their member companies are finding it harder and harder to find qualified workers.
But now that these same companies are asking for the H-1B cap to be raised in order to help fill this demand, suddenly the labor shortage itself is being challenged.
Although every metropolitan area newspaper boasts pages and pages of high-tech help wanted ads each week, the General Accounting Office has challenged the methodologies that ITAA and the Commerce Department used to quantify the shortage.
GAO, while careful not to dispute the actual shortage, cited the lack of unusual salary growth for high-tech workers as evidence that the shortage may not be as widespread as reported.
However, CIO Magazine reports that the average compensation for a high-tech worker rose 13.5 percent in 1997, nearly four times the average wage increase for non high-tech workers. These figures also do not account for other methods companies use to attract employees, such as sign-on bonuses, extra vacation, stock, nor for they efforts they make to attract them, such holding recruiting fairs during spring break.
Even Norman Matloff, a computer scientist on the faculty of the University of California-Davis who believes the shortage does not exist, admits that the wages of technology workers rose more than 7 percent in 1997. This is compared to average U.S. worker wage increases of 2.3 percent and an inflation rate of 2.1 percent.
Foreign workers are sometimes blamed for taking jobs from Americans by accepting lower wages. More cynical critics believe the entire high-tech industry invented the labor shortage in order to replace higher-paid American workers with low-paid foreign workers, turning the industry into an "electronic sweatshop."
However, information from the National Science Foundation shows that foreign-born scientists and engineers on average earn more, not less, than U.S.- born counterparts. One reason the foreign-born employees are paid more is that they often are fluent in two or more languages and can help U.S. companies break into new global markets.
Cynics also argue that industry leaders practice "ageism," refusing to hire older workers with families and higher salary demands in favor of younger employees who can work all night for much less compensation.
In any case, according to these critics, U.S. workers should be retrained to take over these jobs before any more foreign workers are allowed in. These critics are unwilling to concede that there is an immediate shortage, for that could open the door to more foreign-born workers.
Critics have no data based in logic to support their arguments. There are legal complaint mechanisms in the H-1B program which prohibit the payment of wages below prevailing rates. Also federal and state laws protect against age discrimination
Yet few complaints and lawsuits are not being filed. That’s because abuses don’t exist; a shortage does. Harris Miller, President of the ITAA said critics are “jumping off the pier and into the water” because critics cannot substantiate their position. Anecdotes can mislead
While it's easy to find anecdotes about 55-year-old engineers who cannot find jobs, these isolated cases are not indicative of an overall trend.
The current unemployment rate for electrical engineers is 0.4%. Between fixing the Year 2000 problem and meeting new demands, U.S. high-tech workers of all ages are in high demand. And their average salary of $49,586 per year is 73 percent higher than average U.S. private sector compensation.
If enough American workers with the relevant skills were available, U.S. companies would never undergo the expense (up to $15,000) and time-consuming hassle that it takes to hire an H-1B worker. Christopher Lancashire, President and CEO of CompuTec, an international human resource organization said that Computec’s business has tripled in the past nine months because employers are so desperate.
Rather than taking jobs from Americans, H-1B workers actually create more jobs by developing products that require marketing, sales and administrative support. Intel founder Andy Grove is a prime example of this. An immigrant from Hungary, Grove created hundreds of thousands of jobs at his company, which is often credited as the leader of the U.S. high-tech industry.
As valuable as these H-1B workers are, companies that use them recognize that they are only a temporary solution to a permanent problem. High-tech companies spend about $200 billion a year on training programs to keep their workers current, and an additional $4 billion a year to fortify American public schools, colleges and universities.
But it is nowhere near enough. According to AEA, between 1985 and 1997, the number of bachelor’s degrees awarded in engineering in the U.S. decreased by the following proportions:
· engineering, 16 percent
· mathematical/computer science degrees, 29 percent
· electrical, electronics and communications engineers, 37 percent; and
· the number of computer and information sciences degrees decreased computer and information sciences, 42 percent.
Increasingly, computer science degrees – especially at the master’s and Ph.D. levels – are being earned by foreign nationals, whom companies must use an H-1B visa to hire.
High school and elementary school students do not show promise of reversing the trends at the university level. The Third International Math and Science Study, released in February, ranked U.S. 19th out of 21 countries in math skills and 16th out of 21 countries in science skills. No relief in sight
The high-tech labor shortage is real and affects a variety of companies nationwide, including manufacturing, pharmaceutical and education. And it's going to get worse.
According to the Bureau of Labor Statistics, demand for database administrators, computer support specialists and computer scientists is expected to increase by 118 percent; for computer engineers, 109 percent, and for systems analysts, 100 percent.
Clearly, the problem is much bigger than 30,000 more H-1B workers can solve. But increasing the 65,000 cap on H-1Bs is a place to start.
If the high-tech industry is unable to hire the skilled professionals they need for nearly six months, project postponements and cancellations will hurt their profits. Should stocks on Wall Street tumble as a result, the entire economy could be affected. *Alice Yardum-Hunter is an attorney with 18 years of exclusive practice in the field of immigration and nationality law and is located in Encino, California.
Copyright © 1998 Alice M. Yardum-Hunter. All rights reserved
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