Government, Human Resources, and Law

Would immigration reform create jobs and innovation?

February 27, 2013
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Do immigration barriers stifle entrepreneurship and our vital STEM workforce?
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Being an immigration attorney, I witness firsthand how U.S. companies — including Michigan companies — struggle to recruit the engineers, researchers, health care workers, software developers and other STEM workers they need. You may be shocked to learn that presently there are between 700 and 800 openings for highly skilled and essential workers for over 40 established West Michigan employers posted on HelloWestMichigan’s website.

The number of such professional and skilled job openings for the 40+ member companies has remained steady at between 700 and 800 for nearly the past two years, according to Cindy Brown, executive director for HelloWestMichigan.

More than 40 percent of Fortune 500 companies were founded by immigrants or their children. Highly skilled STEM-educated immigrants are more likely to work in highly innovative fields, creating and supporting businesses with the most growth and job-creation potential. 

More than three out of every four patents at the top 10 patent producing U.S. universities has at least one foreign-born inventor listed, and the nearly 1,500 patents awarded to these universities are tied to inventors from 88 different countries, according to “Patent Pending: How Immigrants Are Reinventing The American Economy,” a 2012 report from The Partnership for a New American Economy.

More than half of all patents were awarded to foreign inventors “most likely to face visa hurdles: students, postdoctoral fellow or staff researchers.” Foreign nationals are listed as inventors on 84 percent of information technology patents, 79 percent of patents for pharmaceutical drugs or drug compounds were invented or co-invented by a scientist born abroad and 75 percent of patents in the molecular biology and microbiology fields are attributable to an immigrant.

With foreign-born individuals representing half of our U.S. graduate students in the STEM fields, clearly, we need to increase the number of U.S. born STEM grads, a dilemma that will not resolve overnight.  For U.S. employers to access this STEM talent now, they turn by necessity to the current U.S. immigration process and, specifically, the H-1B visa program.

You may not be aware that every H-1B application directly funds training and scholarships for U.S. workers, including grants to local communities to provide high-level training to employed and unemployed U.S. workers in occupations where skills shortages exist.

The American Competitiveness and Workforce Improvement Act established a mandatory H-1B employer training fund fee. U.S. employers are required to pay the Department of Homeland Security $1,500, employers with 26 employees or more, or $750, employers with 25 employees or less, for each H-1B professional worker petition, and these monies are deposited into a federal fund dedicated to the education and training of U.S. workers. Since 1999, nearly $2 billion has been collected from the H-1B program, with numerous awards granted to date, according to the National Foundation for American Policy.

Unfortunately, the H-1B specialty occupation visa category is capped at 65,000 per fiscal year, with an additional 20,000 for those individuals who possess a U.S. master’s degree.

Last fiscal year, the 20,000 quota for foreign advanced degree holders was hit only three weeks after the visas became available, with the general H-1B cap hit in just 10 weeks. These arbitrarily low annual quotas have left numerous employers across the country unable to access these highly skilled engineers, innovators, inventors and job creators who drive the growth of our economy.  

Each year approximately 50,000 master’s and doctoral students graduate from U.S. universities. However, one-third of those graduates accept job offers from competing countries — including China, India, Canada, the United Kingdom, Singapore and Australia — despite a preference to apply their knowledge and skills right here in America. 

New York City Mayor Michael Bloomberg, co-chair of the Partnership For a New American Economy, a coalition of mayors and business leaders who support the need for immigration reform, stated at the STEM in the City leadership summit this winter, “We are on the wrong side of global competition. . . . Our economy depends on immigrants, and, currently, our immigration policy is what I call national suicide.” 

What can be done to stop this brain drain and the unintended boost of our foreign competitors?

One solution would be to exempt foreign students holding U.S. advanced STEM degrees from the H-1B cap. Another partial solution would be to allow unused H-1B visa numbers from previous fiscal years, resulting from administrative processing delays with H-1B visa issuance at U.S. embassies abroad, to be recaptured in future years.    

The Immigration Innovation Act of 2013, introduced by Orrin Hatch (R-Utah), Amy Klobuchar (D-Minn.), Marco Rubio (R-Fla.) and Chris Coons (D-Del.), incorporates both of these ideas and increases the current cap from 65,000 to 115,000 and establishes a market-based escalator that adjusts the cap up or down based on the demands of the economy, with a hard cap of 300,000 in any given year.

The bill proposes that if the cap is hit in the first 45 days when petitions may be filed, an additional 20,000 H-1B visas would be made available immediately: if hit within the first 60 days, an additional 15,000 H-1B visas would be made available; if hit within the first 90 days, an additional 10,000 H-1B visas would be made available and if the cap is hit within the first 185 days to 275 days, an additional 5,000 H-1B visas would be made available.

The bill would also provide spouses of H-1B visa holders with work authorization.

The Sustaining our Most Advanced Researchers and Technology Jobs Act of 2012 bypasses the H-1B category altogether.

Introduced in the Senate by Senator Lamar Alexander (R-Tenn.) and Chris Coons (D-Del.), the SMART Jobs Act proposes the creation of a new temporary visa category, the F-4 visa, for students pursuing master’s or doctorate degrees in the U.S. and offers U.S.-educated graduates in advanced STEM programs a path to permanent residency once they have secured full-time employment in a STEM field.

And how about those 7 to 10-plus-year waits for many highly skilled foreign professionals to become green card holders?

Currently, our system offers employment-based applicants a total of only 140,000 total green cards annually, which includes spouses and children who account for more than half of the available numbers.

To alleviate the multiple-year bottlenecks that have resulted, the Immigration Innovation Act of 2013 would exempt advanced U.S. STEM degree holders from the employment-based green card caps, along with extraordinary ability aliens, outstanding professors and researchers, and dependents of employment based immigrant visa recipients, eliminate the annual per-country quotas and provide re-capture and rollover of unused employment based green card numbers in other categories from previous years.

What about those entrepreneurs wishing to start up new businesses in the U.S.?

Each foreign-born graduate with a U.S. advanced degree in a STEM field creates, on average, 2.62 American jobs, according to a recent study by the American Enterprise Institute and the Partnership for a New American Economy.

Under our current system, entrepreneurs are faced with extremely limited to no visa options. 

This winter, President Obama called on Congress to create a special visa category, allowing foreign entrepreneurs who launch successful startups to live and work in the U.S., provided they raise a minimum level of capital investment and employ a minimum number of U.S. workers. 

The creation of new visa categories for STEMs and entrepreneurs will do no good if the current “Culture of No” at the U.S. Citizenship and Immigration Services service centers, where employment-based petitions are adjudicated, is not alleviated.

The dramatic increase in denials and multiple-page Requests for Evidence for H-1B and L-1 petitions in the last four years, with no corresponding change in the immigration laws or regulations, still plagues U.S. employers nationwide. 

While the problem is acknowledged by USCIS Headquarters in D.C., there will be no resolution until the immigration officers who are issuing erroneous case decisions are forced to view petitions in light of the actual statutory and regulatory requirements and not their own personal biases.

The need to reform our broken immigration system is never more evident than today.

Our own Gov. Snyder issued a public statement on the need for immigration reform, praising the bipartisan efforts to move forward on this issue: “Our current immigration system is inflexible and broken. It has hurt our economy by deterring foreign investment and making it harder for our companies to find the talent they need to grow and create more jobs. In Michigan, we know we must continue to welcome innovators, entrepreneurs and skilled workers from around the world. They can help our core industries — automotive, agriculture and tourism — continue to drive Michigan’s comeback and help our nation remain an economic superpower.” 

I observe with cautious optimism, tempered by realism, the current bipartisan comprehensive immigration reform proposals.

Whether it’s a comprehensive reform package addressing the multi-faceted woes of our current system, or the passage of several needed reform bills — let’s hope the differences between and within the parties do not stand in the way of progress.

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