Is H1B Policy to Blame for Shortage of U.S.-born Technology Graduates?

In a recent blog, I speculated on the reasons for the seeming lack of interest in computer science and engineering careers among our budding college graduates. I noted that many of the Millennial generation seem bored with the technology on which they were weaned, while others are too busy dreaming of becoming the next superstar (sports, entertainment) thanks to the well-meaning—but ultimately damaging—lie that “You can be anything you want to be.” 

One reader, however, took me to task for not mentioning what he believes is the real reason behind the lack of enthusiasm for technology among recent graduates. This reader pointed out that thanks to H1B, visas issued by the federal government, low-paid foreign IT workers are flooding the U.S. market and companies are snapping them up rather than pay more for homegrown workers. As a result, potential graduates see little future in an IT career—at least in the United States. 

According to Workpermit.com, a Web site devoted to “immigration advice,” an H1B visa is a non-immigrant visa, which allows a U.S. company to employ a foreign individual for up to six years. Individuals can’t just apply for an H1B visa to allow them to work here. The employer must petition for entry of the employee. H1B visas are also subject to annual numerical limits. 

When it comes to IT workers brought in under H1B visas, however, American companies get a whopping bonus, because they can pay such workers far below the standard wage paid in the United States for their work. The companies get cheap labor, but U.S. workers, as my reader suggests, get the shaft. I agree with my reader that the H1B program—ostensibly set up to fill a labor gap—has negatively affected the market for homegrown IT talent, and I have written as much on several occasions. 

On the other hand, the companies that ask for H1B workers claim they do so because there is a shortage of American workers who can perform the same tasks, and the rapidly declining numbers of computer science graduates seems to give credence to that claim. It seems legitimate for these companies to complain that there is insufficient U.S. IT talent out there to meet the immediate needs of our industries, including insurance. At the same time, however, there is little incentive for American students to pursue an IT career based on the potential job market, so the call for more foreign workers only increases. 

Is there a political angle to all this? You bet. At the recent SAS Premier Business Leadership Series conference in Las Vegas, SAS CEO Jim Goodnight said that for his company, “It has become more and more difficult to hire Ph.D.-level people interested in writing code, and we’re not producing homegrown people.” As a result, SAS is asking Congress to approve more H1B visas to fill the gap, but Goodnight says there is political resistance to that idea. 

“Nancy Pelosi refuses to give in on bringing smart people in until the 12 million people who are here illegally—most of whom will vote Democratic—are granted amnesty,” he stated. Interestingly, SAS is very active in funding computer education and literacy in U.S. schools, an effort for which they should be applauded. 

Is there an easy solution to this mess? Probably not. Perhaps the Obama administration, which seems fond of telling companies what they should pay their employees, should insist that any workers hired through the H1B system be paid the same as American workers in the same jobs. 

While that would seem to level the playing field, however, I would oppose it on the grounds that the government needs to keep its hands off what private industry pays its employees—although the trend now is disturbingly in the opposite direction. I would favor eliminating the H1B program as an incentive for companies to train up their own IT professionals, as Chubb once did. It seems clear at the moment that we cannot depend on our colleges and universities to supply these workers. 

The reader who took me to task has chosen to remain anonymous thus far, but perhaps he will now post a comment here. Or perhaps you will. 

Ara C. Trembly (www.aratremblytechnology.com) is the founder of Ara Trembly, The Tech Consultant, and a longtime observer of technology in insurance and financial services.