The New Immigration Wave

Throughout much of the 20th century, the industrial barons of Pittsburgh relied on immigrants and the sons of immigrants from all over Europe to work its steel mills, coal mines and railroads. Today, as the city builds its reputation as a 21st-century high-tech center, its companies still rely on the skills of immigrants.

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H-1B Visas At a Glance

The H-1B work visa is issued for "specialty occupations" only. An applicant must be sponsored by an employer. The employer pays filing fees and, usually, legal fees. The application fee is $1,110 per petition; $1,000 of this fee is earmarked for technical education for U.S. workers.

Before filing an H-1B petition, an employer must receive an approved Labor Certification Application (LCA) from the Department of Labor. The LCA must show that the employer has advertised the open position to U.S. citizens and will pay prevailing wages to the H-1B candidate.

Specialty occupations are positions that require at least a four-year U.S. bachelor's degree or a foreign university equivalent related to that position, or education plus relevant work experience and responsibility equivalent to a degree.

H-1B visas are good for three years and may be extended for another three, on approval of an extension petition, for a maximum concurrent term of six years. After that, an H-1B holder must return to his home country for at least one year before applying for a new visa. However, an H-1B holder who has applied for U.S. citizenship at least one year before his last H-1B term is up may be granted one-year extensions on his H-1B while the INS processes a green card.

No per-country or per-company H-1B quotas apply. However, companies with more than 15% of their employees on H-1B status must prove to the Labor Department and INS that they aren't discriminating against U.S.-born employees. Also, companies may not lay off U.S.-born workers in H-1B-equivalent positions, then fill those positions with H-1B holders.

H-1B employees must receive salaries and benefits equivalent to those received by their U.S.-born colleagues. H-1B employees are "at will" employees, meaning that if their work performance is poor, employers are free to dismiss them.

H-1B visa holders are free to solicit job offers with employers other than their original sponsors. A "portability" clause in the revised regulations permits H-1B holders to start work immediately if they accept a new job; the old regulations required a new H-1B petition to be approved first. These job changes don't count against annual visa caps. Virtually all employers report that their H-1B hires eventually ask for their help in gaining U.S. citizenship. Many choose to help as a way of keeping valued talent.

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That irony isn't lost on Lew Wheeler, CEO of Rapidigm Inc., a Pittsburgh-based IT consulting firm.

"I grew up in a row house in a steel town surrounded by union guys," Wheeler says. But instead of building steel superstructures, Wheeler's firm helps clients with software infrastructures, from supply-chain management to e-business platforms. And instead of hiring millworkers from Eastern Europe, Rapidigm is searching for software engineers - and finding them in Asia.

"There's a tremendous shortage of software engineers in this country," says Wheeler. He and other sources say U.S. universities simply don't graduate enough software developers to meet industry demand. So of the approximately 1,000 engineering consultants Rapidigm will hire this year, Wheeler expects that 700 of them will be foreign-born and entering the U.S. under the H-1B specialty-occupation visa program.

Filling such shortages was the rationale cited last year among high-tech firms that lobbied for raising the annual H-1B visa cap. Last October, Congress increased the cap from 115,000 to 195,000 for the federal fiscal years 2001 through 2003, with the cap dropping to 65,000 in 2004.

Proponents of the increase said the availability of 585,000 H-1B visas over the next three years is vital to sustaining the U.S. technology industry's growth. Opponents claimed that the IT worker shortage was overblown and suggested that more visas meant more competition for U.S. IT professionals.

But while the rhetoric was loud, reliable statistics to support either view are scarce, making it difficult to analyze the impact of the H-1B visa program on the IT talent shortage. The Immigration and Naturalization Service (INS), which processes H-1B visas, has kept very few detailed statistics on the program - although since raising the visa cap, Congress has ordered the INS to do a better job of it.

"There is such a lack of INS information about the H-1B that it was nearly impossible to say how the H-1B would fit into the gap in IT worker supply," says Alan Merten, president of George Mason University in Fairfax, Va., and chairman of a National Research Council (NRC) committee that studied the U.S. high-tech labor shortage last year.

The INS estimates that it issued approximately 54% of its H-1B visa quota to technology workers in fiscal 2000, or approximately 78,000 individuals. However, because the INS occupation categories are so broad, it's almost impossible to know precisely what types of IT jobs those H-1B candidates hold.

Yet discussions with immigration attorneys, analysts, immigration consultants and companies that hire H-1B holders reveal some evidence of the H-1B's effect on the IT labor market. In short, it seems the H-1B visas mainly address the shortages of technology workers for a relatively small niche of the overall IT workforce: hard-core software and hardware design skills for technology companies, IT contractors and consulting firms.

While some corporate organizations - which employ approximately two-thirds of the IT workforce - do hire H-1B applicants, the majority of H-1B hires go to technology hardware and software vendors.

At those firms, it seems that H-1B professionals do fill IT jobs that would otherwise go begging. But opponents still say the program harms the U.S. IT labor force.

Merten's NRC report committee heard testimony that not all H-1B recipients had the skills required for the jobs they were filling and that unscrupulous employers undercut wages for everyone by underpaying H-1B employees. Yet the committee's report points out that these charges were anecdotal; no one would provide details, making it impossible to investigate these claims.

Wheeler says that Rapidigm just can't find enough American software engineers and that the alternatives to using H-1Bs to fill his firm's jobs trouble him. "If we close our borders to foreign-born workers, the software development will just go to other countries," Wheeler says. "We'd rather import people to write the software than export those jobs."

Paperwork Purgatory

To understand why H-1B holders are more prevalent in certain segments of the IT industry, it helps to understand some of the key provisions of the H-1B program.

Documentation requirements are one issue. For example, individuals don't apply for H-1B visas; employers do. As part of the H-1B petition process, employers must demonstrate to the INS that the job they're trying to fill is so specialized that it requires at least a bachelor's degree and that the H-1B petitioner's degree is directly relevant to the job being offered.

Further, an employer might need to document that all of its other employees in identical or comparable positions have degrees. These requirements tend to funnel H-1B holders to highly specialized positions.

In part, that's because corporate IT organizations are increasingly hiring or training people with non-IT backgrounds or degrees to fill positions requiring strong business and communications skills. Such companies would find it difficult to prove to the INS that those positions required specialized degrees as H-1B regulations require. It's much easier to meet the specialization requirements in hard-core technology areas like systems design and software engineering.

"An IT support organization often is looking for less cutting-edge people," says P.J. Ohashi, a senior technical recruiter at staffing firm Hall Kinion Corp.'s Bellevue, Wash., office. "These companies probably aren't going to do an H-1B sponsorship."

Throughout the petition process, which may last several months, the INS may require more information about the position itself, an employer's wage structure or the applicant's credentials. Immigration law attorneys point out that many firms simply don't want to spend the time or the money necessary to assemble this documentation - or risk a Department of Labor investigation into their hiring practices.

"Many people are intimidated by what they need to do to hire a foreign professional," says Howard Skolnick, in-house counsel for SAI Software Consultants Inc. in Kingwood, Texas, which hires many H-1B holders.

"Some companies, especially smaller, cost-conscious ones, are reluctant to get involved because the process is so complex and cumbersome," agrees Andrew Lipkind, an immigration attorney in Buffalo, N.Y. He and other attorneys say legal fees may range from $2,000 to $3,000 per petition, with discounts for high-volume clients. "It's the expense of getting the best possible talent into your company," he says.

And that's the way a lot of companies view the H-1B process.

"We're just thankful to have access to as many talented technical specialists and engineers as we can," says Kent Jenkins, a Cisco Systems Inc. spokesman in Washington. Cisco sponsored 398 H-1B petitions in the first five months of fiscal 2000, according to the INS.

Immigration attorneys say that in addition to longtime users of the H-1B program, they're seeing more business from companies new to the H-1B process. Most are small technology firms, and some may submit only one or two H-1B petitions.

"If you need that one person who's crucial to your business, you'll go through the process," says a spokesman for the American Immigration Lawyers Association.

Immigration on the Rise

Read across to see how many H-1B visas remain in effect from a given year. Read down to see the cumulative effect in a given year:
YEAR OF ISSUE

FY1999

FY1999

FY1999

FY1999

FY1999

FY1999

FY1998

325,000[1]

260,000

195,000

130,000

65,000

0

FY1999

136,888

136,888

136,888

*136,888

136,888

136,888

FY2000
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145,000

145,000

145,000

*145,000

145,000

FY2001
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195,000

195,000

195,000

*195,000

FY2002
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195,000

195,000

195,000

FY2003
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195,000

195,000

FY2004
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65,000

Estimated
Annual total

461,888

541,888

671,888

801,888

931,888

931,888

* Denotes year in which original visas would be expired if three-year extension was not filed with and approved by the INS
1 1998 was the year in which the American Competitiveness and Workforce Improvement Act became law and temporarily raised the cap on H-1B visas from 65,000 to 115,000 in FY1999 and FY2000. This starting figure of 325,000 visas assumes all visas issued from 1994 through 1998 remained active for six years (5 x 65,000); thus the figure decreases by 65,000 in each succeeding year as visas expire. (The 65,000 cap level was established in 1990 and by law, the U.S. may not lower the H-1B limit beneath that amount.)



Watson is a freelance writer in Chicago.Computerworld H-1B Feature Stories:
Playing the Numbers Game
How many IT Jobs are being filled by foreign workers? Nobody really knows.

Land of Plenty
Why do H-1B workers or job candidates want to participate in the program? Opportunities.

Computerworld's H-1B and Immigration Research/Resource Links:
H-1B and Immigration Resources
A list of resources from around the Web with more information about H-1B visa programs and U.S. immigration policies.

Read Computerworld's past H-1B Coverage:
H-1B Visa Coverage

Computerworld Forums:
What do you think?

Post your opinions about the H-1B program, and read what others have to say here.

Copyright © 2001 IDG Communications, Inc.

  
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