Will more H-1B visas end the tech labor crisis? Nov 03, 2000 08:10 AM ET

By Scotty Fletcher and Jessica Griffith, LocalBusiness.com

NEWS ANALYSIS ATLANTA, Nov. 3 (LocalBusiness.com) -- Ashish Bahl knows the impact an extra 87,500 visas can make.

Bahl, president and CEO of Atlanta-based high-tech incubator CyberStarts, has used more than 45 overseas employees in the incubator's portfolio companies since the beginning of the year.

"We use Indian firms to supplement our staff on a lot of our development work," said Bahl. "We can bring skilled engineers over for $50 to $60 per hour -- both contracted workers and H-1Bs for assignment -- and they go back when the job is finished. It dramatically reduces the cost of developing our technology."

Outsourcing high-tech work overseas may now become the norm for many American companies. Last month, the government increased opportunities for skilled foreign workers by raising the number of H-1B visas -- a type of immigration visa corporations use to bring educated immigrant workers to the United States -- from 107,500 in FY2000 to 195,000 for each of the next three years.

Many experts and business owners applaud the decision, saying the United States should encourage the admission of more educated foreigners. But they also warn that the newly expanded limits are not a cure-all for the high-tech worker shortage.

Consider the numbers: The Information Technology Association of America estimates that half the 1.6 million IT jobs created this year will not be filled. The resulting loss of productivity is estimated at $4.5 billion a year, according to the Computer Technology Industry Association.

The high-tech worker crunch Prior to the expansion of the skilled visa program, the government regularly would reach its cap by spring. By February of this year -- just five months into the federal fiscal year -- 81,262 H-1B visas were granted, according to a report from the Immigration and Naturalization Service. Of these, 43 percent came from India and 10 percent from China. Recipients must have at least a bachelor's degree or comparable education.

"Congress clearly came to the rescue on this bill," said Sam Myers, co-founder of Myers Thompson, a Minneapolis law firm that specializes in employment-related immigration.

Employment specialists acknowledge the problem is widespread. "We have felt the crunch, like every other company in our industry," said Laurie Fider, human resources manager at Arden Hills, Minn.-based Syntegra, the systems integration subsidiary of British Telecom.

Syntegra has 16 to 18 skilled visa holders among its U.S. workforce of about 900. Fider said if Syntegra decides to apply for more skilled visa workers it now will be able to hire them more quickly. Many of its foreign hires begin as new college graduates, but quotas often were full by May or June, forcing the company to wait until October.

More than 150 employees at NIIT work on H-1B visas nationwide. The information technology software, education and training company is based in India but has its national headquarters in Atlanta.

"These workers have been trained on our system and are able to become part of the team very quickly because they have been working on projects overseas," said Naushad Ahmed, vice president of professional services for NIIT. "Having them here has greatly increased our growth rate. The fact that the bill has passed is a fabulous thing."

Not a cure-call Although adding more visas is a start, it may be just a band-aid. Even with the increase, analysts say the demand will still most likely exceed the number of foreign workers allowed to work in U.S.-based firms.

Also, the time it takes the INS to approve the visas remains a problem. For many small companies and start-ups, even if a candidate is hired, it takes a while before they can begin working.

Another problem is timing. The H-1B normally has a six-year max, said Anton Mertens, partner of law firm Smith, Gambrell & Russell in Atlanta, and green cards can take as long as eight years to be approved.

"Timing is everything," said Mertens. "But there is some relief. While workers are waiting for their green cards, they can stay here as an H-1B, but they may end up working for the same employer for several years."

In response to this problem, the government will allow immigrants waiting for green cards to extend their H-1B status beyond the six-year max, in one-year increments, until their application has been approved.

Also, workers under H-1B's status can now change jobs or employers without affecting their status, as long as the new job is in "the same or a similar occupational classification" as the job in the original petition, said Mertens.

But the law, he said, is vague.

"It's going to be hard to explain why someone can go from a systems analyst job in Atlanta to another systems analyst position in Silicon Valley that may pay twice as much," said Dan White, also a partner with the Atlanta law firm. "INS will probably alter this part of the law. It will be hard for employers to explain, for example, that there was no one to fill the position in California. It may be a while before we know how to interpret this."

"It's not a slam-dunk procedure," said Ed Hayward, a partner in the Minneapolis law firm Oppenheimer Wolff & Donnelly LLP. "You have to show that no U.S. workers are qualified or available for the position."

Small companies also could find themselves priced out of the visas, said Sophie Lambert, an associate attorney with Oppenheimer Wolff & Donnelly's New York office. The new bill raises the cost of a visa from $610 to $1,110, and the employer pays most or all of the fee.

"Especially for start-ups, the cost can get pretty high," Lambert said.

Helping in the process are a new breed of online services, including VisaNow.com of Chicago which uses a software program to automate some INS application sections. Also, H-1BSponsors.com, a company based in India, matches foreign job candidates to U.S. employers. More than 10,000 job seekers and 200 companies have registered on the site, which has found positions for about 500 workers.

"Now that they gave this allotment of visas, it's going to be somewhat of a race to see which companies will get the visas first," White said.

http://www.localbusiness.com/Story/0,1118,ATL_490507,00.html

-- Martin Thompson (mthom1927@aol.com), November 03, 2000

Answers

Visa change aims at tech labor crisis, but is it a solution? Nov 03, 2000 07:33 AM ET

By Jessica Griffith, LocalBusiness.com

MINNEAPOLIS, Nov. 3 (LocalBusiness.com) -- Software CEO Glyn Meek knows the value of the right kind of visa.

Twenty years ago, he came from England to Texas on an H-1B, a type of immigration visa corporations use to bring educated immigrant workers to the United States. Meek is now a U.S. citizen and chief executive officer of Austin, Texas-based systems management software company TriActive Inc.

"I was able to do more here than I could have in England," Meek said. "There, society is very much a class structure, where the United States is more of a meritocracy."

The vision of the United States as a land of opportunity has never waned, Meek said. Last month, the government increased those opportunities by raising the number of skilled worker visas from 107,500 in fiscal year 2000 to 195,000 for each of the next three years.

Many experts and business owners applaud the decision, saying the United States should encourage the admission of more educated foreigners. They also warn, however, that the newly expanded limits are not a cure-all for the high-tech worker shortage.

Consider the numbers: The Information Technology Association of America estimates that half the 1.6 million IT jobs created this year will not be filled. The resulting loss of productivity is estimated at $4.5 billion a year, according to the Computer Technology Industry Association.

The high-tech worker crunch Prior to the expansion of the skilled visa program, the government regularly reached its cap by spring. By February of this year -- just five months into the federal fiscal year -- 81,262 H-1B visas were granted, according to a report from the Immigration and Naturalization Service. Of these, 43 percent came from India and 10 percent from China. Recipients must have at least a bachelor's degree or comparable education.

"Congress clearly came to the rescue on this bill," said Sam Myers, co-founder of Myers Thompson, a Minneapolis law firm that specializes in employment-related immigration.

Employment specialists acknowledge the problem is widespread. "We have felt the crunch, like every other company in our industry," said Laurie Fider, human resources manager at Arden Hills, Minn.-based Syntegra, the systems integration subsidiary of British Telecom.

Syntegra has 16 to 18 skilled visa holders among its U.S. work force of about 900. Fider said if Syntegra decides to apply for more skilled visa workers, it now will be able to hire them more quickly. Many of its foreign hires begin as new college graduates, but quotas often were full by May or June, forcing the company to wait until October.

More than 150 employees at NIIT work on H-1B visas nationwide. The information technology software, education and training company is based in India, but has its national headquarters in Atlanta.

"These workers have been trained on our system and are able to become part of the team very quickly because they have been working on projects overseas," said Naushad Ahmed, vice president of professional services for NIIT. "Having them here has greatly increased our growth rate. The fact that the bill has passed is a fabulous thing."

Not a cure-call Not everyone is convinced the increase in skilled worker visas will help the technology economy. Myers, the attorney, said it is a short- term solution. Instead, the United States needs to train more technology workers.

A large portion of the fee for the skilled worker visas is designated to fund programs that would encourage children to study math and science, but Myers said results of these programs are not yet conclusive.

Minneapolis-based IXMatch expects to hire more overseas employees under the new bill, said Kurt Peterson, a talent finder for the company. IXMatch develops software that helps recruit job candidates and match them to appropriate positions. But, Peterson said the INS still takes too long to approve the visas, a particular problem for small companies and start-ups.

"That's the problem and dilemma we face. If we find a candidate, they won't be able to start until later," he said.

"It's not a slam-dunk procedure," said Ed Hayward, a partner in the Minneapolis law firm Oppenheimer Wolff & Donnelly LLP. "You have to show that no U.S. workers are qualified or available for the position."

The new bill tries to address some of the timing issues by making the visa more portable, INS spokeswoman Eyleen Schmidt said. If a worker wants to switch jobs once he is in the United States, he can apply and make the switch while the INS is processing the application.

Small companies also could find themselves priced out of the visas, said Sophie Lambert, an associate attorney with Oppenheimer Wolff & Donnelly's New York office. The new bill raises the cost of a visa from $610 to $1,110, and the employer pays most or all of the fee.

"Especially for start-ups, the cost can get pretty high," Lambert said.

Helping in the process are a new breed of online services, including VisaNow.com of Chicago, which uses a software program to automate some INS application sections. Also, H-1BSponsors.com, a company based in India, matches foreign job candidates to U.S. employers. More than 10,000 job seekers and 200 companies have registered on the site, which has found positions for about 500 workers.

Filling the 'vacuum' Daniel Miranker, a founder and chief technology officer at Austin- based Liaison Software Inc. said his company has used foreign workers on special visas in the past, but has no plans to use them in the future.

He said information technology is such a labor-intensive business that other solutions are necessary, such as software that can perform tasks such as Website construction and application development.

"Things are so out-of-whack now that they could remove that law altogether, and we would still be short of people," Miranker said.

The problem also depends on type of worker needed and where a company is located. Meek said he has not used the program because he can find the people he needs in Austin.

Myers said the United States risks losing local business if it does not allow immigrant workers to fill voids.

"The alternative is American employers go offshore," he said. "Any large high-tech company has a constant demand for highly qualified tech workers. They are not going to cease expansion because of U.S. immigration limitations. They are just going to open operations in England or Ireland or other English-speaking countries."

LocalBusiness.com staff writers Marsha Barancik, Peggie Evans, Scotty Fletcher and Tim Green contributed to this story.

Jessica Griffith covers the Twin Cities region for LocalBusiness.com. LocalBusiness.com staff writers Marsha Barancik, Peggie Evans, Scotty Fletcher and Tim Green also contributed to this story.

http://www.localbusiness.com/Story/0,1118,ORL_490479,00.html

-- Martin Thompson (mthom1927@aol.com), November 03, 2000.

To see the real "non-spinned" (in other words, the TRUE) situation concerning H1B visas, please visit: http://www.zazona.com/ShameH1B/ http://heather.cs.ucdavis.edu/svreport.html

These are things that the industry lobbyist (who control the media) are desparate that you not see.

-- K (infosurf@yahoo.com), November 03, 2000.