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U.S. Tech Worker Shortage Looms, Study WarnsU.S. Tech Worker Shortage Looms, Study Warns

Tech-industry backed group says U.S. is losing the global battle for tech talent to countries that welcome skilled workers with open arms. But not everyone is convinced of a talent shortage.

Paul McDougall

May 23, 2012

5 Min Read

If the U.S. does not adjust its immigration policies to make it easier for foreign-born tech workers to reside in the country, it could fall behind the rest of the world in growth and innovation, say the authors of a new study that's sure to provoke controversy.

"There is a significant gap between the kind of graduates the U.S. is producing and what the American economy needs today and in the future," said officials at the Partnership for A New American Economy, in a statement. "U.S. companies are hungry for talent with degrees in STEM [Science, Technology, Math, and Engineering]--these jobs are increasing three times faster than jobs in the rest of the economy. However, these positions are the hardest to fill because of the dearth of native-born Americans with these degrees."

The group's study, provocatively titled "Not Coming To America," said that only 4.4% of U.S.-born undergraduates are enrolled in STEM programs. That compares poorly with 33.9% for students in Singapore, 31.2% for those in China, 12.4% for Germany, and 6.1% in the U.K. As a result, the U.S. will face a shortage of 224,000 hi-tech workers by 2018, the study says.

According to the group, which is backed by leaders from tech, media, and financial giants, including Microsoft's Steve Ballmer and JP Morgan Chase's Jamie Dimon, as well as municipal leaders like New York City Mayor Michael Bloomberg, that means the country needs to open up its immigration policies to make up for the shortfall.

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"We are quickly losing our edge as other countries adopt smarter, economic-driven immigration policies. The future is on the line--now is the time to reform the system and welcome the workers who will continue our success as the world's leading economy," said Bloomberg, in statement. The Partnership for New York City also backed the study.

The study's authors said the U.S. needs to take several steps to ensure that the supply of tech talent meets future demand.

They called on Congress and U.S. Citizenship and Immigration Services to establish a new visa category for foreign entrepreneurs looking to launch startups, to set aside more H-1B visas and green cards for foreign students enrolled in STEM programs at U.S. institutions, and to offer tax breaks for American tech workers who have moved abroad to encourage them to return home. Earlier this month, Senator John Cornyn (R-Texas) introduced a bill, the Securing the Talent America Requires for the 21st Century (STAR) Act, that would reserve 55,000 green cards for foreign students enrolled in graduate level STEM programs at U.S. institutions.

To offset those visas, the so-called green card diversity lottery would be eliminated.

They study's authors said special visas should also be created that would allow workers to be employed in specific areas of the country where demand for certain skills is the greatest.

"To remain a global leader, America should recruit immigrants with the right skills to fill jobs where they are needed," said former Toronto mayor David Miller, who consulted on the study. "Countries like Canada encourage regions and businesses to identify skills needed in their local labor markets. In a global competition for talent, this approach ensures that immigrants with the right skills for the economy are chosen."

Not everyone is convinced that the U.S. is facing a tech worker shortage. Ron Hira, a public policy professor at Rochester Institute of Technology, has said that claims of an imminent talent crunch are trumped up by tech companies looking for cheap, controllable labor. Hira declined to be interviewed, but provided InformationWeek with a copy of written testimony he gave to a Senate judiciary subcommittee last year.

Hira noted that Microsoft, one of the nation's largest tech employers, announced layoffs of 5,000 workers in 2009. "This was a substantial share of its workforce and according to its most recent filings Microsoft's workforce in the U.S. still hasn't come back to its 2009 levels," Hira said.

"The typical H-1B worker merely has ordinary skills, skills that are no better than American workers who are currently unemployed or underemployed," said Hira.

Earlier this year, IBM laid off about 1,900 workers, according to Alliance@IBM, which advocates on behalf of Big Blue employees. The group claims that since 2005, IBM has reduced its U.S. headcount by about 30%, from 133,789 employees to 94,000 today. The numbers have not been confirmed by IBM, which has discontinued its practice of reporting employee headcount by country.

Still, those people who believe it should be easier for tech workers to enter and remain in the country insist that immigration reform is essential if individual locales and the nation as a whole are to remain globally competitive.

"New York City is beginning to lose jobs to foreign competitors with business-friendly immigration policies," said Kathryn Wylde, president and CEO of the Partnership for New York City. "Our city's business leaders agree with Mayor Bloomberg that immigration reform belongs at the top of the national agenda."

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About the Author(s)

Paul McDougall

Editor At Large, InformationWeek

Paul McDougall is a former editor for InformationWeek.

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