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America’s industries of the future need more workers

Retaining U.S. educated international graduates is the place to start

"[International graduates] are a source of national strength. A vast majority want to stay and contribute to American innovation.We must make it easier for them to do so."
Eric Schmidt, "I Used to Run Google. Silicon Valley Could Lose to China." New York Times, February 27, 2020

America’s industries of today and of the future need more workers

In a recent op-ed in the New York Times, Eric Schmidt (former CEO of Google and current chairman of the National Security Commission on Artificial Intelligence and the Defense Innovation Board) explains how the United States government needs to step up its efforts to win the technology competition with China. This includes building a workforce of technology experts, in part by recruiting global talent to the U.S:

“A majority of computer scientists with graduate degrees working in America were born abroad, as were most current graduate students studying computer science in U.S. universities. They are a source of national strength. A vast majority want to stay and contribute to American innovation. We must make it easier for them to do so.”

While America continues to enjoy historically low unemployment, the tighter labor market means U.S. employers are struggling to fill critical jobs, limiting productivity and putting global leadership at risk. These labor shortages are especially pronounced in emerging industries like artificial intelligence (AI) that rely on science, technology, engineering, and math (STEM) skills. STEM fields have unemployment rates below the national average and more than 300,000 more jobs than there are workers to fill them, according to estimates from New American Economy.1

Maintaining American leadership in STEM fields is critical not only to economic growth but also to national security and global leadership. Dr. Arthur Herman, an expert on defense, energy, and technology issues, writes in American Affairs:

“Today’s Defense Department and other leading experts all agree that the future of America’s defense will rely on advanced technologies such as AI, cyber, quantum, robotics, directed energy and hypersonic weapons, and even 3-D printing. … All of the above technologies will be critical if the United States is to maintain its military superiority over its rivals, including China.”

Yet, despite the demand for STEM workers, America’s immigration laws and policies get in our own way, limiting the avenues available to skilled foreign nationals who graduate from U.S. colleges and universities to remain in the U.S. they graduate and fill critical jobs in the U.S. workforce.

“Our global competitiveness hinges on our ability to attract and retain top minds from around the world”
National Security Commission on Artificial Intelligence Interim Report, November 2019

Retaining international graduates must be part of the solution

To ensure these roles are filled by the best-educated and most highly-skilled professionals, the U.S. must supplement its domestic labor force. As the National Security Commission on Artificial Intelligence explained in a recent report, “The American AI talent pool depends heavily on international students and workers. Our global competitiveness hinges on our ability to attract and retain top minds from around the world.”

Fortunately, there are tens of thousands of highly-skilled and U.S.-educated STEM graduates already in the United States and prepared to enter the workforce. In 2018, 50% of advanced STEM degrees awarded by U.S. colleges and universities went to international graduates, totaling over 250,000 graduates.2 Many of these graduates already have hands-on, U.S.-based work experience in their field of study thanks to participation in Optional Practical Training (OPT), a temporary immigration employment program that aims to facilitate their entry into the workforce (but is limited to a maximum of three years). And these students increasingly want to stay in the U.S. after graduation.

But the U.S. will have to work hard to continue attracting these students; other countries like Canada and Australia are prioritizing recruiting and retaining international students and graduates to their shores, expediting the immigration process and fast-tracking them into the workforce. The U.S. is already losing ground, as seen in the shrinking new enrollment rates fueled by long-term uncertainty for prospective students.

Forcing graduates through the H-1B program guarantees many have to leave the U.S.

There are no immigration programs – temporary or permanent – specifically tailored for skilled immigrants with a U.S. education or in-country work experience,3 meaning most graduates, even if they hope to live and work in the U.S. permanently, have no choice but to first apply for a temporary H-1B work visa.4 While the H-1B program was initially designed for employers to address temporary labor shortages in specialty occupations, it is now functioning as the country’s primary high-skilled immigration program.5

For more on barriers to recruiting and retaining global talent in the U.S., read our report here.

85,000

Annual number of H-1B visas available



190,098

Total H-1B petitions received by USCIS in first week of FY20



95,885

Petitions filed on behalf of individuals with an advanced degree from a U.S. college or university



The H-1B program simply does not provide enough visas or prioritization to effectively retain international STEM graduates. There are only 85,000 H-1B visas available each year, a cap set by Congress and unchanged for a decade; yet in FY17 USCIS received 236,000 employer-sponsored H-1B petitions in the first week, triggering a randomized lottery to see who would be lucky enough to apply for one of the 85,000 spots.

Though Congress and government agencies have tried to prioritize international graduates in the H-1B lottery by setting aside 20,000 of the annual H-1B visas for applicants with advanced degrees from U.S. schools and refining the selection order, the rapidly growing number and share of international graduates has far outpaced this small set-aside, while the demand for such high skilled labor continues to increase.

Since 2012, individuals with an advanced degree from a U.S. school have grown from 25% to 50% of the H-1B petition pool.6 In 2018, the total number of U.S. advanced degree holders being sponsored for H-1Bs hit 95,000, eclipsing the total number of available visas by 10,000.


Even if advanced degree holders were very lucky and were selected for every single H-1B visa in the lottery, it would still leave 10,000 U.S. educated graduates with no opportunity to get a visa and start contributing. In reality, the chance of an advanced degree holder winning the H-1B lottery in 2018, even if it were conducted under the new selection process, would only be 55%, meaning 43,000 graduates would have been denied a chance to apply.

The United States would benefit by expanding its legal immigration avenues so all international graduates, including advanced STEM degree holders with a job offer, have a chance to stay and contribute to the workforce and the U.S. economy.

Solutions to retain international graduates and protect American leadership

As Dr. Schmidt explains, “We can change the immigration process for highly skilled people now to reduce the red tape, backlogs and uncertainty that threaten to drive tech talent to other countries — including to our strategic competitors.”

The United States would benefit by expanding its legal immigration avenues so all international graduates, including advanced STEM degree holders with a job offer, have a chance to stay and contribute to the workforce and the U.S. economy.

The most straightforward solution is to allow graduates with a U.S. degree and a job offer to start working and begin the green card process immediately; this would relieve pressure on the H-1B program and keep it more focused on truly temporary workers, while facilitating permanent residency for well-educated and highly-skilled individuals who have already lived in the U.S. for some time and can fill permanent roles.7 If they eventually apply for citizenship, they will be eligible to work in more restricted occupations like government defense and security jobs.

The benefits of retaining international graduates extend far beyond the jobs they’ll fill. Highly-skilled graduates and workers earn relatively higher salaries and make outsized contributions to the economy. They also benefit native-born Americans by creating jobs, raising wages, and fueling research and innovation.

This should be done in addition to, and not in place of, current categories like family sponsorship, humanitarian relief, or the diversity visa. The United States’ economic and demographic needs will not be met by shifting numbers from one category to another, and massively cutting legal immigration overall will wipe out the gains to one industry with harm to others.

Footnotes

  1. The Bureau of Labor Statistics lists unemployment rates at 3.0% for computer and mathematical occupations, 2.0% for architecture and engineering, and 1.4% for healthcare practitioners and technical occupations.
  2. Based on analysis of tables from the Digest of Educational Statistics 2019, published by the National Center of Education Statistics under the Department of Education. For reference, see "Table 323.30 Master's degrees conferred by postsecondary institutions, by race/ethnicity and field of study: 2016-17 and 2017-18” and “Table 324.30 Doctor's degrees conferred to males by postsecondary institutions, by race/ethnicity and field of study: 2016-17 and 2017-18”.
  3. Compare to Canada, where international graduates have multiple options to apply for permanent residency, and where time spent studying and working in the country directly supports their application.
  4. Transitioning from a student visa to a green card is difficult, in part because the student visa is a “single intent” visa, meaning it is only for the purpose of studying; the student is not allowed to enter on a student visa if they intend to stay in the U.S. permanently. Even when it’s possible for an employer to immediately sponsor an employee, the green card process is long, complicated, and costly, and many employers are hesitant to begin the process immediately. This presents a challenge for international students because they cannot continue working on their student status; outside of OPT, they need a new immigration status that allows them to work until their employer is ready or able to sponsor them. And even if employers will sponsor the employee, if the individual is from a country like India or China, they will face long backlogs before they are even eligible to begin the process.
  5. For more on how the failure to update the high-skilled immigration system for decades has led to an overreliance on the H-1B program and significant challenges to recruiting and retaining talent, see the joint report from FWD.us and the Orrin G. Hatch Foundation, “Barriers to recruiting and retaining global talent in the U.S."
  6. Based on analysis of USCIS breakdown of general cap and advanced degree exemption cap totals for FY13-17, available in the proposed rule “Registration Requirement for Petitioners Seeking To File H-1B Petitions on Behalf of Cap-Subject Aliens” (see Table 7—H-1B Petitions Received by Regular Cap and Advanced Degree Exemption), plus additional data previously provided by USCIS for FY18 (while USCIS has scrubbed the 2018 data from its website, it can still be viewed in a cached version here.
  7. This closely reflects the approach in previous bipartisan proposals, including former Republican Sen. Orrin Hatch’s Immigration Innovation Act (S. 2344) and the comprehensive immigration reform bill (S. 744) that passed the Senate in 2013.
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