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4/6/2007
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With The H-1B Visa Cap Filled In Record Time, Reform Is In The Air

If changes to the controversial foreign worker program happen, they'll likely occur this year and be tied to increases in the visa cap.

For both critics and supporters of the H-1B visa, two days last week revealed everything you need to know about the foreign worker program, one of the most controversial topics in business technology.

In the first two days that the U.S. government accepted applications for H-1B work visas, 133,000 envelopes poured in with applications seeking 65,000 openings. The crush was enough that U.S. Citizenship and Immigration Services cut off new applications, certain the envelopes it had--many with multiple applications--would fill the slots. It's the fastest the application period has ever closed. Last year, the cap was met May 26, the year before that in August.

H-1B visa supporters see the overflow as reason to raise the cap so businesses can get the talent they need from abroad. Critics see the queue as a mockery of what the H-1B is supposed to be. Instead of a ticket for the supertalented to work in the United States, the visas are being hoovered up, often by offshore outsourcing companies that want to train workers on U.S. business and technology practices so they'll be better workers when they head home.

Reformer Grassley isn’t opposed to raising the visa cap

Reformer Grassley isn't opposed to raising the visa cap

Photo by Sipa Press
In 2004, in the trough of a U.S. recession, Congress lowered the visa cap to 65,000 after three years at 195,000. In 2005, it added 20,000 visas for foreign nationals who graduated with advanced degrees from U.S. universities. The tech industry--which takes the majority of the visas--has been pushing to raise the ceiling to at least 115,000. However, the policy debate in Washington this year could move beyond the cap number to more serious reform, starting with a bill introduced last week by Sens. Chuck Grassley, R-Iowa, and Dick Durbin, D-Ill. (More on that later.)

Differences are emerging within the pro-H-1B camp. Major U.S.-based software vendors, most of which look to bring foreign workers here indefinitely, are subtly trying to distinguish their needs from companies that want an ever-rotating staff of short-term foreign workers.

Still, tech employers continue to speak with one voice about the need to increase the number of H-1B visas. Last month, Microsoft chairman Bill Gates testified before a Senate committee on the need to let more people from abroad work here, accurately predicting that the H-1B allotment would quickly be filled. "The question we must ask is, how do we create an immigration system that supports the innovation that drives American growth, economic opportunity, and prosperity?" Gates said. His recommendations centered on attracting the best students from abroad to study here and stay when they finish, and to expedite work privileges and permanent-resident status for highly skilled workers.

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How is the market for IT jobs in the U.S.? Merely OK. The IT unemployment rate based on an average of the past four quarters is 2.3%, according to Bureau of Labor Statistics data released last week. To compare that, unemployment across all management and professional jobs, IT and non-IT, was 2.2%.

Some segments have boomed: In IT management, jobs are up 31% since the tech employment nadir of 2003, and unemployment is 1.9%. Jobs in the largest IT category, software engineers, are up 17% from 2003 and unemployment is 1.7%. But the second largest category, computer scientists and system analysts, has been flat since 2003, with 2.6% unemployment today. Support specialists see 3.2% unemployment, network and system admins 3.6%. Overall, IT jobs are up just 1% since 2001 and 5% since 2003.

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