SUNS  4290 Tuesday 29 September 1998


UNITED STATES: CONGRESS LIFTING QUOTAS FOR HI-TECH WORKERS

Washington, Sep 25 (IPS/Jim Lobe) - The U.S. Congress, under pressure from the fast-growing hi-tech industry, is moving to double, temporarily, the number of highly-skilled foreign workers who will be permitted to work in the United States.

The House of Representatives voted 288-133 Thursday to approve a proposal negotiated with the White House to raise the annual cap on special H-1B visas, which has been 65,000 for the past few years, to 115,000 for 1999 and 2000.

In 2001, the quota would be reduced slightly to 107,500 under the bill which the Senate is expected to approve next week. In 2002, the quota would be restored to 65,000 again.

House passage marks the culmination of a three-year campaign by the hi-tech industry to preserve and expand its ability to recruit highly-skilled computer programmers and engineers from overseas.

Foreign-born professionals already play a major role in the hi-tech industry. A recent study found that one-third of the engineers living in the hi-tech mecca of California's 'Silicon Valley' came from other nations.

Top industry officials, such as Microsoft's Bill Gates, have argued that foreign recruitment is vital if the United States is to retain its global dominance in hi-tech over the long term. But foes of the visa
expansion say that the programme has been abused by companies, many of them owned by immigrants or foreign companies, who use it as a way to avoid the costs of more highly paid U.S. programmers and engineers.

At stake is the future of the so-called H-1B visa which permits skilled workers to work in the United States for up to six years under the sponsorship of the importing company. Many H-1B visa-holders eventually become permanent residents.

Almost half of all H1-B visa applicants are from India, whose own Bangalore-based computer industries are a major recruitment ground for U.S. companies. During the first half of 1998, most of the remaining applicants came from China (nine percent), Britain (five percent), the Philippines and Canada (three percent each) and Taiwan, Japan, Germany, Pakistan and France (two percent each), according to government figures.

Demand for H1-B visas has mushroomed. The 65,000-visa quota for 1998 was filled in early last May, and there is now a backlog of more than 30,000 applications.

The biggest sponsors of H1-B visas are actually companies owned by Indian immigrants or by Indian firms, according to a recent 'Washington Post' report which noted that these businesses often pay their workers less than what their U.S. counterparts with similar skills would be paid under U.S. law. One recent study found that hi-tech foreign workers earn 15-30 percent less than comparable U.S. workers.

Indeed, some critics say the visa programme is being used as a hi-tech version of the 'bracero' programme which permitted U.S. agribusiness to exploit cheap Mexican labour to harvest produce from U.S. farms 50 years ago.

In Thursday's debate, Democratic Rep. Ron Klink argued that many visa-holders were being used as "indentured servants" whose overall impact was to drag down wages in the industry and make it harder for highly-skilled U.S. workers to get jobs.

Another Republican congressman from California, where the hi-tech industry is strongest, agreed, charging that the expansion of the quota was aimed at appeasing a "powerful big business interest trying to secure cheap foreign labour".

But the industry has insisted that it is suffering a serious shortage of highly-skilled workers and must look overseas to make up the difference.

The Information Technology Association of America, the industry's major lobby group, recently reported that were almost 350,000 current openings in its associated companies for computer programmers, engineers and systems analysts. That represents about ten percent of all U.S.-based jobs in the information sector.

But critics question that claim. In testimony before Congress last July, Norman Matloff, who teaches computer science at the University of California at Davis, charged that the companies were being too "picky" in their employment policies, hiring only about two percent of programmers who apply for jobs.

If the industry had soaked up all eligible US workers, he argued, then one would expect wages to rise sharply. In fact, wage increases have been relatively modest, while universities have been pumping out graduates with computer science degrees at record rates.

"Claims of high-tech worker shortages are inflated," according to John Reinerg, who heads the Institute of Electrical and Electronic Engineers-USA here.

The administration of President Bill Clinton has tried to walk a difficult line between the contending forces. Not wishing to alienate its labour allies, the biggest single source of Democratic campaign
funds in November's mid-term elections, the administration has also been worried about Republican efforts to woo the industry, whose own largesse helped propel the president to victory in 1992.

As a result, Clinton negotiated a deal aimed at meeting the industry's demands while protecting against some of the most important abuses in the programme.

Under the bill, employers will be required to pay a 500-dollar fee for each H-1B visa with the money to be used for training of U.S. workers and greater enforcement of the programme's restrictions. The administration said some 250 million dollars should be raised in this way over the next three years.

Firms with more than 50 employees of whom 15% are visa-holders will also have to prove that they are not using the programme to avoid hiring US workers. The bill also requires employers to pay "prevailing wages", which are defined as including key benefits which many companies have not paid to foreign workers in the past.

Those changes were sufficient to neutralise the opposition of some critics, notably the big AFL-CIO labour confederation which, in the words of one official, "chose not to oppose the legislation."