We often take for granted that the U.S. is a melting pot, and that we are a nation of immigrants. In fact, this country has been built on the shoulders of hard-working men and women from all over the globe.
We tend to forget how important immigration is to our economy, how encouraging an influx of talented, skilled workers from around the world, is the key to maintaining this country’s competitiveness in a fast-changing global market. As the world continues to grow smaller and more interconnected, it is more important than ever. To remain competitive in an increasingly globalized world, the U.S. needs to do everything it can to attract and retain brainpower – the best and the brightest – not build walls.
Those who are turned away instead go create businesses, invent and innovate for our competitors, reducing growth and innovation at home. It’s ironic that many “free market” advocates here in the U.S. are card-carrying protectionists when it comes to immigrant labor.
To remain competitive in an increasingly globalized world, the U.S. needs to retain the best and the brightest – not build walls.
The truth is that businesses are in fact eager to bring foreign talent to our shores, and traditionally, one of the best (or at least most common ways) to do that is through the H-1B program – the visa used by businesses to employ foreign workers in occupations requiring specialized skills and at least a bachelor’s degree. Given that the U.S. needs to do everything in its power to attract these highly-skilled foreign workers needed by so many of its businesses, the question quickly becomes … Why is the H-1B process so complicated, time-consuming and prohibitive?
Today, as has been for more than a decade, the demand among businesses for highly-skilled, foreign workers far exceeds the number who are able to attain H-1B visas. Congress continues to arbitrarily cap the number of H-1B visas at 85,000, 20,000 of which are allotted to workers holding a master’s degree or higher.
For the past three years, the U.S. has met that cap within the first week of accepting applications. In 2015, 233,000 petitions were filed, but again, only 65,000 were accepted, a 28 percent acceptance rate. This year, the number of applications rose yet again, just outpacing last year’s record numbers. This means that, as demand continues to increase and the cap stays put, we’re denying employment to thousands upon thousands of highly-skilled foreign workers – and to more every year.
Do we deny visas to so many in order to protect American jobs? Because the research actually shows that, rather than reduce the number of jobs for native-born workers, H-1B workers help inspire job creation. A study by the National Foundation for American Policy found that U.S. technology companies increase their total employment by five workers “for every H-1B position requested.”
For the past three years, the U.S. has met the H-1B cap within the first week of accepting applications.
Another report by Harvard Business School found that the H-1B visa program for skilled foreign professionals “has played an important role in U.S. innovation patterns” over the past 15 years. Specifically, it found a direct correlation between an increase in H-1B caps and an increase in the overall number of inventions and patents, thanks to the “direct contributions of immigrant inventors.”
It also seems that the arbitrary limits on the number of H-1B visas may be having the opposite effect on the U.S. labor market than Congress intends. A number of polls of U.S. technology companies have shown that, when faced with these limitations on hiring skilled, foreign workers, companies react by moving more of their business outside the United States – to regions where this skilled workforce is available.
For these reasons, it’s absolutely critical that Congress begin to incrementally lift its arbitrary cap on the number of H-1B visas. It’s time to reevaluate our priorities and the way our visa programs are constructed. Voices throughout the tech community and beyond have been calling for change for years, but little has been done to amend the system.
While calls for reform have been growing in volume, and bills like the “H1-B and L-1 Visa Reform Act of 2015” and the “Immigration Innovation Act of 2015” have been introduced in earnest, Congress hardly seems to be in a rush. Today, both bills still languish in committees.
When I talk about reforming our visa programs, I’m not just talking about lifting caps on the number of visas issued; it goes beyond that.
In December, a new law went into effect requiring any company in the U.S. with more than 50 employees to pay an additional $4,000 if more than half of its staff already hold such visas. This makes an already expensive and complicated process even more cost-prohibitive. The overall cost to employers of applying for an H-1B visa is already upwards of $5,000 per employee.
So, while smaller companies and startups with fewer than 50 employees may be able to avoid the additional costs, it’s still by no means easy for these companies to acquire H-1B visas for their employees. For startups and SMBs, the process can be extremely time consuming and a drain on already-scant resources.
For example, as I wrote last year, even before filing a petition for a visa, every company has to file a Labor Condition Application with the U.S. Department of Labor that essentially attests that hiring an H-1B employee will not adversely affect any U.S. citizen- workers. This requires small companies to go through the time sink of establishing themselves properly by showing they have the cash-flow necessary to provide their prospective H-1B employees with the correct wages, and so on.
The overall cost to employers of applying for an H-1B visa is already upwards of $5,000 per employee.
What’s more, businesses across the board are eager to hire young workers, especially those right out of college. The benefits are many. Compared to “more experienced” candidates, hiring recent grads can mean lower costs — both in terms of salary and saving businesses from having to re-train employees or have them “un-learn” old habits or tools — along with a greater facility with technology, social media and metrics, higher levels of energy agility and innovation, and more.
Companies have begun to realize that hiring young people can be a smarter investment over the long-term as well, developing talent and future management within the organization rather than paying top-dollar for candidates from the outside.
Today, however, we’ve begun to see things trending in the opposite direction. Particularly in the case of foreign talent. Thanks to the maze of paperwork and difficulty of acquiring visas, businesses are becoming increasingly reluctant to hire foreign college students.
This is in spite of the fact that the number of foreign college students in the U.S. is on the rise. According to analysis by the Brookings Institution, since 2000, the U.S. has seen a 49 percent increase in the number of foreign students enrolled in our universities. Yet, as the same numbers show, in 2010, only 30% of foreign grads from U.S. universities were able to obtain an H-1B visa.
Thanks to the maze of paperwork and difficulty of acquiring visas, businesses are becoming increasingly reluctant to hire foreign college students.
This reality has led some schools, like the Kelley School of Business at Indiana University, to take matters into their own hands. In 2014, the school created an initiative called the IU Immigration Bridge Program, which was designed to aggregate its resources and bring together corporate recruiters, immigration law firms and graduates in an effort to help its students navigate and streamline the H-1B process.
It’s another great example of just how deep the problem has become and the extent to which it’s affecting both our businesses and our institutions. Change has been so slow to come at a policy level that even our nation’s universities – not traditionally among the most agile or reactive of our nation’s institutions – are moving to create their own workarounds to address visa gridlock.
That’s why, when we talk about reforming our visa programs, we’re not just talking about lifting caps on the number of visas issued; it goes beyond that. Instead, we need to consider the creation of an additional, complementary visa that is geared towards the foreign college students (graduates of both U.S. and international institutions) who now find themselves being pushed to the back of the H-1B applicant line.
Over the last few years, as the U.S. economy has rebounded, we’ve seen a dramatic uptick in employment levels, but nowhere has job creation been more explosive than in “STEM” fields – in science, technology, engineering and mathematics. Job growth has skyrocketed in these innovation-rich fields, which have begun to play an increasingly vital role in our increasingly connected world. Yet, according to InformationWeek, in 2015, outsourcing service providers received the largest share of H-1B visas. Not only does that potentially mean fewer H-1Bs for companies in STEM-related fields, but it also could mean that foreign workers with more traditional skill sets are actually receiving a swath of visas, and thereby drowning out the more highly-skilled foreign workers the H-1B is meant to serve.
Unable to acquire a visa and with no other alternatives available, our growth analyst, Abhi, will be forced to leave the U.S.
When considering the answer to this question, I can’t help but relate the experience of UpCounsel’s growth analyst, Abhishek Arora. After graduating from Berkeley last year, Abhi came to work for us and has been a model employee and important member of our team.
Earlier this year, he applied for an H-1B visa but sadly was denied. Unable to acquire a visa and with no other alternatives available, Abhi will be forced to leave the U.S. and pursue opportunities in other countries.
While this is a big blow for both Abhi and UpCounsel, the sad reality is that Abhi’s case is hardly unique; it’s one of many. Countless companies can relate to this story and that’s a huge problem.
After all, we live in a time where a highly skilled labor pool is only going to become more important to the health of the U.S. economy, especially as the population ages and as more jobs require advanced (and technical) skill sets. In the end, we need to be doing everything we can to welcome the best and brightest to our shores, and to encourage them to stay, rather than building paperwork barriers that keep them out. It’s both good business and good policy.