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What Is Wrong With High-Skill Immigration Policy?

Anyone following the news this summer could be forgiven for thinking the debt ceiling discussion was the only thing going on in Congress. Other Capitol Kabukis were also unfolding, however. For example, on 26 July -- during a publicity-sapping week before the debt deadline -- a hearing by the Senate Judiciary Subcommittee on Immigration, Refugees and Border Security examined "The Economic Imperative for Enacting Immigration Reform" and heard incisive testimony about the technical and scientific workforce.

As is usual at such events, the witnesses and senators generally adhered to their talking points, mostly claiming that there's a technical talent shortage that requires admitting more workers from overseas. Even so, a few revealing exchanges highlighted the dismal situation facing many scientists and engineers already in this country and how government policies make it worse.

Markets work when you let them work.

--Ronil Hira

The usual suspects (plus one)

The five-member panel assembled to testify included all the usual suspects. But there was one surprise.

First up were three witnesses from organizations that benefit from admitting larger numbers of foreign-born workers, students, or both. Bob Greifeld, CEO of the NASDAQ OMX Group, and Brad Smith, general counsel for Microsoft, spoke for business. Cornell University's president, David Skorton, represented the academic establishment -- in particular the Association of American Universities, whose 61 member institutions soak up half the federal research funding and award half of all doctorates in the United States.

The fourth witness added a piquant new voice, that of high-skilled visa holders awaiting green cards. Puneet Arora, an engaging physician who has studied at Indian and American universities and practiced medicine among America's underserved -- and who currently is Amgen's director of clinical research -- appeared on behalf of Immigration Voice, an organization of "legal high-skilled future Americans," its Web site says.

Absent from the discussion was any high-skilled current Americans to recount the experiences of citizen scientists who toil for years as postdocs, train their foreign replacements, and hunt futilely for better jobs -- or, increasingly, for any jobs -- in science. But Ronil Hira, associate professor of public policy at Rochester Institute of Technology in New York and a licensed professional engineer, described their plight, focusing on the high unemployment rate among American STEM (science, technology, engineering, and mathematics) graduates.

The usual messages

In beginning the hearing, subcommittee chair Senator Chuck Schumer (D–NY) advocated "virtually stapling a green card to [the] diploma" of anyone earning an American science or technical degree so that "the best and brightest students from around the world" can stay here and "start companies." Senator John Cornyn (R–TX) added that "there is a scarcity of qualified people for many jobs, particularly those requiring special skills." Cornyn, however, was quick to offer that it is illegal to hire "a foreign national under an H-1B program where there is a qualified American ready, willing, and able to do that job."

Greifeld, Smith, and Skorton then expounded on the pressing need for more technically trained foreigners to create jobs and economic growth in the United States. They noted repeatedly the many openings Microsoft and other companies are advertising right now. (Unmentioned were the claims of critics that companies sometimes strategically place job advertisements to circumvent federal requirements that exist to give hiring preference to Americans.) Senators and witnesses both invoked Google, Yahoo, and eBay as examples of immigrants' reputedly special propensity to found great corporations; as often happens, the discussion failed to note that these companies' foreign-born founders and co-founders arrived in this country as small children and were educated in American schools.

Witnesses also repeated another widely repeated, though convincingly refuted, claim -- that H-1Bs create jobs for Americans, specifically that five citizens are hired for every short-term visa holder admitted. Were this bit of mythology true, John Miano of the Center for Immigration Studies has written, "the H-1B program should be creating around 500,000 to 1,000,000 new jobs a year," a number so large it couldn't be missed, but that "simply is not there. Statistically, there is no linear correlation whatsoever between H-1B visas and job growth. "

A jobs recession for scientists

High-skill temporary worker programs like the H-1B visa, which were intended ostensibly to "complement the American workforce," have "made it too easy to bring in cheaper foreign workers with ordinary skills -- ... not specialized skills, ... not the best and brightest -- to directly substitute for, rather than complement, American workers," Hira said. What's more, "54% of the H-1B applications were for the lowest wage level, the 17th percentile. ... That's hardly the best and brightest."

"According to the IEEE-USA's analysis of Labor Department data," Hira continued, "there are more than 300,000 unemployed engineers and computer scientists" in the United States. And though Hira did not mention it, tens of thousands of the scientists counted as employed are trapped in low-paying postdoc "training" jobs that economists have long recognized as effectively disguising unemployment.

Beyond replacing American workers at home, Hira continued, short-term H-1B and L-1 visas provide "an unfair competitive advantage to companies specializing in offshore outsourcing. ... Simply put, the U.S. government is subsidizing offshoring."

Markets work when you let them

During the question period, Senator Chuck Grassley (R–IA), the cosponsor, with subcommittee colleague Senator Dick Durban (D–IL) of a bill to tighten the H-1B program, asked Hira if he could "rebut the assertion that some, including your co-panelist Brad Smith, have made that the U.S. does not in fact have enough highly skilled workers."

"The data [do not] support that assertion by Mr. Smith," Hira replied. "The unemployment rates ... are very high. In fact, they're higher for STEM graduates than for all college graduates. So, unless [you] argue that liberal arts majors are somehow in short supply, it's hard to argue this. The unemployment rates are twice to three times what we would expect."

Skorton expounded on the existence of such a shortage, calling the "raw unemployment rate ... too gross a measure" of whether "the right skill match" exists. Skorton did not address how universities could identify and supply the needed skills without worsening overall unemployment. "There [are] always cases [of] shortages of very narrow occupations," Hira acknowledged -- then went on to cite "a very good example" of the market working correctly. In the past few years, starting salaries for petroleum engineers "went up from about $69,000 to $84,000." Enrollments in U.S. petroleum engineering programs shot up, "filled almost exclusively by Americans."

"Markets work when you let them work," Hira said. "Importing workers "is intervening in the normal functioning of the labor market." The industry witnesses, however, displayed a dedication to free markets only when, under questioning by Senator Jeff Sessions (R–AL), Smith opposed the idea of replacing the current U.S. visa system with one like Canada's. The Canadian system awards points to visa applicants based on education or skills, whereas the U.S. allows employers, such as companies and universities, to select the individuals they wish to have admitted to the country. The point system, Smith said, would "basically put the government in a position [of] trying to determine what [will] best meet needs in the marketplace."

"You want to be able to do that yourself. I understand that," Sessions pointedly observed. He added that "other studies ... agree with Dr. Hira. I think he's fundamentally right."

Visa mills

Grassley argued that Schumer's visa-stapling proposal would "further erode the opportunities of American students. Universities would in essence become visa mills," he said. (One could argue that, because of their existing ability to import almost limitless numbers of international students and postdocs, they are visa mills already.)

Skorton's testimony illuminated universities' interest in keeping that power. "Contrary to concern expressed by some critics," he said, "there are not enough qualified or interested American students to fill all the slots in STEM undergraduate and graduate programs." Students and postdocs exist to serve institutional needs, he seemed to imply, and not vice versa.

"The United States benefits enormously from high-skilled, permanent immigration," Hira acknowledged. But because of badly designed visa programs, "many American high-tech workers and students believe [that] government policy purposely undercuts their careers," he warned. "Workers are leaving the field and telling students to stay away. ... This threatens the country's capacity to innovate and create jobs for the economy."

On balance, everyone agreed on only one thing: that the current high-skill immigration situation is a mess. Unfortunately, many of the solutions offered would only make things worse.