Bordering on Confusion

The prospects for Congressional action on immigration reform underwent a “seismic change” on Election Day, said Senator Mark Warner (D–VA) on the evening of 7 December. Warner was speaking to a large audience at the National Press Club in Washington, D.C., and a larger one watching on C-SPAN. A lawyer who made a fortune as an early investor in the telecommunications firm Nextel and other high-tech startups, Warner has long advocated increasing the number of H-1B skilled temporary worker visas and “stapling a green card to every Ph.D.” as ways of encouraging innovation. As one of three prominent panelists at the culminating event of the 2012 Mortimer Caplin Conference on the World Economy, the theme of which was “High-Skilled Immigration: Politics, Economics, and Law,” he declared himself “optimistic” that immigration legislation incorporating these policies could pass the incoming Congress.

Proponents of reform can count on “strong bipartisan support for new visa programs for STEM”—that is, science, technology, engineering, and mathematics—added Teresa Sullivan, Warner’s fellow panelist and president of the University of Virginia (UVA) in Charlottesville, home of the Miller Center, which sponsored the conference. The “global battle for talent” impels the United States to admit more skilled foreigners, agreed the panel’s third member, billionaire entrepreneur and philanthropist Steve Case, best known as a co-founder of AOL.

When the companies say they can’t hire anyone, they mean that they can’t hire anyone at the wage they want to pay.

Deceptive unanimity

This elite and visible unanimity, however, belied the tangle of issues revealed earlier in the day during the smaller, nontelevised meeting where scholars from economics, political science, law, and public policy examined the likely difficulties of devising immigration policies that help the economy without harming immigrants or people who are already in the country. Daytime speakers also considered the difficult job market facing many STEM workers, another issue that the three evening panelists’ statements ignored.

During the evening panel’s question period, Computerworld’s prize-winning reporter Patrick Thibodeau asked how shortage assertions square with current high rates of under- and unemployment among American IT workers, especially those over 35. An audience member then asked about the front-page article on America’s scientist surplus that appeared inin July. Sullivan said that immigration shouldn’t “substitute for” providing opportunities to Americans but did not elaborate on how to prevent this. Case simply said that there are “plenty of jobs.”

Conflicting interests

The daytime expert conference helped to explain why people still argue that a skills shortage requires increased immigration, despite the reality of today’s very challenging STEM job market. A background paper prepared by Daniel Tichenor, a political scientist at the University of Oregon in Eugene, explained that the current, highly dysfunctional system of visas and regulations, like all of U.S. immigration law, arose from a complicated struggle among many interests.

University of Texas, Austin, political scientist Gary Freeman placed the politics of skilled immigration into the category that political scientists term “client” politics, in which the benefits of particular governmental actions accrue to a small number of groups or individuals while the costs diffuse more widely over people who may not even realize that they are being harmed. The result, as in the skilled-immigration debate, is that the groups benefitting from policies tend to be highly organized while the opposition is not. Many of the early-career scientists working in academe, for example, fail to distinguish between organizations that employ scientists in real jobs paying salaries commensurate with their skills and programs that “train” more scientists at low pay, adding to the supply of job-seekers while doing nothing to create real jobs.

The few who stand to benefit from such policies can nonetheless lose out to other strong interests, as happened when a proposal to increase high-skill visas—at the expense of visas devoted to increasing cultural diversity—failed in Congress late in 2012. The desire to attract more technical innovators goes back to the Founding Fathers, especially Alexander Hamilton, Tichenor writes. However, suggested Susan Martin of Georgetown University’s Institute for the Study of International Migration in Washington, D.C., and other speakers, in a “comprehensive” immigration bill meeting many needs, skilled immigration could again lose out to more powerful forces.

Shortage claims remain “politically effective and, thus, popular,” said Michael Teitelbaum, formerly vice president and program director at the Alfred P. Sloan Foundation and now a Wertheim Fellow at Harvard Law School. He noted that in 2007, the United Kingdom adopted a rational approach to shortage claims by establishing the Migration Advisory Committee, an expert governmental body that investigates and determines whether “immigration is a sensible answer” to reported hiring difficulties, he said.

In contrast, the “employer-driven” American system gives that power to the entities that hire immigrants, said Ron Hira of the Rochester Institute of Technology in New York. For those doing the hiring, “the benefit of high-skill immigration” is that it “allows employers to pick” the workers they want from a large pool, explained Jennifer Hunt, a labor economist at Rutgers University in New Brunswick, New Jersey. “When the companies say they can’t hire anyone, they mean that they can’t hire anyone at the wage they want to pay,” she continued. The current American system imposes “no labor market tests” on the immigration of foreign workers, and in the IT industry, “age discrimination is an open secret,” Hira added. Employers “don’t have to look for Americans [and] can and do replace Americans. No shortage is necessary,” and employers can “pay below-market wages legally.”

Other approaches to selecting immigrants bring their own benefits and costs, speakers noted. Countries such as Canada and Australia have moved toward systems that award points for skills and characteristics and admit those who score highest. They have found, however, that people admitted on the basis of their credentials (but without links to specific employment) often have difficulty finding work that utilizes the skills that gained them entry.

Other experts propound a market-based approach that would require employers who claim shortages to buy rights to employ foreign workers at the going wage. This would protect the homegrown workforce by making immigrant employees more expensive than comparable Americans, said economist Madeline Zavodny of Agnes Scott College in Decatur, Georgia. And because it makes employers pay a premium to fill a job, it also tests whether shortages actually exist, she added.

All of these approaches beg another crucial question, speakers noted: how to define “high skills.” Able, well-educated individuals can succeed in a wide range of jobs, including jobs tangentially related to their education and skills. So which fields and what levels of education, training, or experience should be included? Which institutions’ credentials should be accepted?

Perverse incentives on campus

Companies are not the only powerful entities with financial interests in maintaining or increasing skilled immigration. Falling state support for public universities has created “perverse incentives” to admit foreign students who pay full out-of-state tuition and don’t receive financial aid, Teitelbaum said. At 12 of the 25 universities with the most foreign students, he noted, international enrollments have jumped by almost half over 5 years. All but one of this dozen are public institutions, and half are prominent Big Ten state flagships. Over the same period, Sullivan said, in another connection, UVA’s foreign enrollment has risen by 60%, with most foreign students coming from China.

Universities are also increasingly dependent on foreign graduate students and postdocs to do the work that allows universities to maintain their research operations and compete for grants, Sullivan added. American students often shun Ph.D. and postdoc programs because they “have intervening opportunities”—more attractive career paths than long years of low-paid bench work. Foreign students with no other option for entering the United States, she said, “stay and finish the degree.” This raises the question of whether the United States should be doing more to make academic careers more attractive to Americans instead of continuing to pursue a low-wage foreign workforce. The latter serves the short-term interests of academic institutions but may not serve the long-term interests of the United States.

Calls to attract the “best and brightest” from abroad seem less about securing unique talent than further saturating the market with redundant high-skilled labor, several speakers observed. “Stapling a green card” to all or most STEM graduate degrees would effectively give the power to grant permanent residence and work status to universities motivated by their own financial needs rather than by the needs of America’s economy, its STEM labor market, and its homegrown STEM workers.

In contrast, real immigration reform, Hira said, should “significantly raise wage floors” depressed by the presence of low-paid workers on temporary visas and “ensure that Americans have a first and genuine opportunity for these jobs”—two goals apparently absent from Warner’s stated preferences.

Just hours before, Teitelbaum had stated that he doesn’t “expect a smart set of reforms” to emerge from the forthcoming effort. He’s probably right, given that the only consensus to emerge from the long day and evening is that the current system is “broken.” The particular elements needing repair, and the steps needed to fix them, remain in dispute.

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