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11/9/2011
02:55 PM
Rob Preston
Rob Preston
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Foreigners Don't Take IT Jobs, They Create Them

Research shows that immigrant-founded companies generate billions in revenue and employ hundreds of thousands of Americans, so why do so many people want to seal our borders?

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My colleague Paul McDougall's recent column on the Occupy Wall Street movement and its potential to make U.S. companies fidgety about their IT offshoring strategies drew a fair bit of reader commentary. McDougall's premise, expanding on comments in the Indian press by HCL Technologies CEO Vineet Nayar, was that the OWS protests could pressure U.S.-based companies to keep IT and other jobs in this country or face a backlash from American citizens increasingly worried about their employment prospects.

The eight commenters came to pretty much the same conclusion: If we keep foreigners out of the U.S., employment will rise and the economy will rebound. One of the more articulate commenters, someone whose "job was outsourced to a foreign company doing business in the US," put things this way:

"We need to put Americans back to work by sending all of these foreign nationals home. Hire Americans first. If a company wants to outsource, require that American citizens and permanent residents are used by the vendor. This would help the economy some. I truly hope that OWS threatens outsourcing to foreign companies and foreign workers."

Another commenter insisted that H-1B and other work visas "be immediately suspended. MILLIONS of our better paying jobs would be instantly RETURNED, to Americans, in America."

While I understand the deep frustrations and fear that accompany 9%-plus national unemployment, I'm not buying this line of reasoning. A body of evidence shows that encouraging highly educated technology and other professionals to come to the U.S., or to stay here after graduating from U.S. universities with engineering or other technical degrees, actually increases employment and economic growth because those go-getters are more likely than the average professional to start and build businesses.

A research team led by Vivek Wadhwa of Duke University, building on studies conducted in the 1990s by AnnaLee Saxenian of the University of California at Berkeley, determined that in a quarter of the U.S. science and tech companies founded between 1995 and 2005, the chief executive or lead technologist was foreign-born. Wadhwa's research estimates that those immigrant-founded companies generated $52 billion in revenue and employed 450,000 people in 2005. In Silicon Valley, the percentage of immigrant-founded startups was even higher: 52% in 2005. Looking over the rich history of the U.S. high-tech industry, consider the economic contributions of companies such as Intel, Oracle, Google, and eBay--all of them with immigrant founders.

Furthermore, Wadhwa's research found that foreign nationals living in this country were listed as inventors or co-inventors in 25.6% of patent applications filed from the U.S. in 2006, up from 7.6% in 1998. Foreign nationals also contributed to most of the patent applications at Qualcomm, Merck, GE, and Cisco at that time, his team found.

More recently, a 2011 report from the Partnership for a New American Economy finds that more than 40% of the current Fortune 500 companies were founded by immigrants or their children. The revenue generated by those companies "is greater than the GDP of every country in the world outside the U.S., except China and Japan," the report states.

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In a speech in Washington in late September, New York Mayor Michael Bloomberg, who made his billions developing systems for financial traders, called on Congress to eliminate the cap on H-1B visas, increase the number of green cards for technical pros, and give foreign students with PhDs in science and tech fields permanent resident status. "Turning these students out of the country is, to put it bluntly, about the dumbest thing we could possibly do," Bloomberg said.

Clearly, foreign nationals aren't just "taking" U.S. jobs; they and their offspring are producing more than their fair share of innovations and economic opportunity, much of it on these shores.

Critics of this line of reasoning will point to the abuses: mainly, the H-1B and other visa holders brought in to do mid-level engineering and other work that could be done by U.S. nationals. But the answer is for government visa issuers to crack down on the abusers, not to end the visa program and shut down immigration of high-skill workers.

What about those U.S. companies moving IT and other jobs offshore by the boatload while accepting U.S. government bailout funds? In this regard, if the Occupy Wall Street climate prompts U.S. businesses and consumers to skew their buying toward companies dedicated to keeping jobs in this country, that's their prerogative. But let individual buyers decide whether to apply that pressure. Don't cede that decision to government bureaucrats.

Rob Preston,
VP and Editor in Chief, InformationWeek
rpreston@techweb.com

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@robpreston @InformationWeek @IWpremium

To find out more about Rob Preston, please visit his page.

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<<   <   Page 2 / 13   >   >>
braya
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braya,
User Rank: Apprentice
11/27/2011 | 1:30:29 AM
re: Foreigners Don't Take IT Jobs, They Create Them
Burger flipping you say? Enter illegal immigrants, which is a far worse problem than the H-1B program. Don't you agree? :)
braya
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braya,
User Rank: Apprentice
11/27/2011 | 1:27:46 AM
re: Foreigners Don't Take IT Jobs, They Create Them
That was what Corporate America wanted at that time and now that they are feeling the backlash, people are whining.
braya
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braya,
User Rank: Apprentice
11/27/2011 | 1:02:25 AM
re: Foreigners Don't Take IT Jobs, They Create Them
All is fair in love and in war. In this case, Trade Wars. The H-1B program as whimsically projected by some people here is capped at only 65,000 a year.

I think we all know why America is on its knees right now, it is a backlash of greed and exploitation.

If you truly believe that "you've got (IT) talent", innovate, move on, prove your niche and stop bitching about H-1B. In any issue America just wants to exploit but not exploited but when we are, we bitch to hell about everything and how America was so great as it was once were. Sounds familiar?

People are whining because apparently they cannot move on because they really don't have the talent. Do you bigshots really think that U.S. Companies will settle and risk ruining their business because of mediocre talent, foreign talent that is? Logic dictates that they won't.

All whiners are scared individuals.
braya
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braya,
User Rank: Apprentice
11/27/2011 | 12:47:05 AM
re: Foreigners Don't Take IT Jobs, They Create Them
Answer: Lobbyists. The system is "workable" by lawyers and it was intentionally made that way. Why? Washington, Inc.
braya
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braya,
User Rank: Apprentice
11/27/2011 | 12:43:00 AM
re: Foreigners Don't Take IT Jobs, They Create Them
When the American economy was good and products and services in America were cheap because of programs such as the H-1B Visa, outsourcing. off-shoring, etc. Americans were certainly not whining or at least the majority of Americans didn't

Blame that to Corporate America.

Everything is fair in love and in war. In this case, Trade Wars.
YMOM100
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YMOM100,
User Rank: Apprentice
11/18/2011 | 6:10:31 PM
re: Foreigners Don't Take IT Jobs, They Create Them
But if all you need is cheap labor, it makes sense to bring them here. If the US is the main market and services need to be rendered, then having folks sit somewhere overseas doesn't help. And you don't have to deal with foreign governments, customs, etc.
hoapres
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hoapres,
User Rank: Apprentice
11/18/2011 | 4:24:19 PM
re: Foreigners Don't Take IT Jobs, They Create Them
My major problem with bloggers is that they often don't investigate the facts but merely rebroadcast somebody else. The concept of checking the validity of Wadwha's study instead of just quoting it assuming that it is factually accurate doesn't even come to thought.

To be fair, bloggers are not acting like a journalist. Assuming that true journalism exists any more with a journalist going around pounding the pavement then one often finds that what you were told is not factually accurate.

The end result is you get statements such as

>> Clearly, foreign nationals aren't just "taking" U.S. jobs; they and their offspring are producing more than their fair share of innovations and economic opportunity, much of it on these shores. <<

which is hardly "Clearly" at all.

Oneshot007
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Oneshot007,
User Rank: Apprentice
11/17/2011 | 11:29:12 PM
re: Foreigners Don't Take IT Jobs, They Create Them
Perhaps some of what you reported could be true. BUT....many companies created here in the US are former H-1b's who gained their citizenship and started IT consulting companies. And guess what?? There are over 300 hundred companies who partner with my company and send me all of their available consultants - who you say ? - Guess What again... are 99% H-1b's ! I've be in IT since the late 70's and I know more about the industry than you! The former H-1b's who are now US citizens and have move up in management now choose H-1b's over US citizens. Many of the H-1B companies are presenting US citizen resumes to their clients and and jacking up the rates without the US citizen knowing and presenting h-1b/green card rates at the client desired rate minus several dollars. I have already caught several of these companies in these practices including discrimination. The program has it's place - BUT THE PROGRAM IS TO NEVER REPLACE A QUALIFIED US CITIZEN WITH AN H1-B - PERIOD!!!!!!!!! WHY don't you log in to some India H-1B blog sites like I have done and screen captured what they are saying - like ' We own the US IT industry'.....and you know what - if they don't they're might close. I like my friends that I have worked with who are from India. Many are also hard working US citizens. No problem with that at all. But we have millions of natural born citizens who spent thousands to go to college but out of work - 450,000 are IT workers. There are currently 2 million H-1B's here for 6-years minimum. (go to http://www.uscis.gov for the facts) DO THE MATH !! We use to let in 250,000 plus per year. We're down to 65,000 plus 20,000 Master h1-b's. We're losing our homes, our families and our minds. KNOW WHAT YOU ARE WRITING BEFORE YOU publish. GET AN ACTUAL PULSE ON THE IT COMMUNITY ! p.s. I am collecting the evidence and will provide to EEO and necessary Inspector General offices.
And if you would like to go undercover to see these practices firsthand so you can write the truth - please let me know.
hoapres
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hoapres,
User Rank: Apprentice
11/16/2011 | 1:18:35 AM
re: Foreigners Don't Take IT Jobs, They Create Them
If you can build your product cheaper in another country then you do it outside the US and don't bring foreign workers to the US in the first place.

YMOM100
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YMOM100,
User Rank: Apprentice
11/16/2011 | 12:58:23 AM
re: Foreigners Don't Take IT Jobs, They Create Them
The difference is that the Chinese have tons of cash and the US doesn't. So why do you think is calling the shots in any form of trade negotiation. The US lost out on that due to reckless administrations wasting trillions on wars rather than on investing into the country's future.
Aside from that, there is plenty of opposition to Wal-Marts all over the place, not just in China.
<<   <   Page 2 / 13   >   >>
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