Showing posts with label H1b visa. Show all posts
Showing posts with label H1b visa. Show all posts

Monday, February 2, 2009

More evidence of dysfunctional immigration policy - REDUX

Recently on progressive websites, like Daily Kos, there have been a spate of hyperbolic, anti-immigrant, stories depicting a scourge of H1b visa holders stealing American high-tech jobs and replacing US workers in times of economic uncertainty.

Taking advantage of current economic anxieties, anti-immigrant allies like the Progammers Guild and their allies have seized the opportunity to promote their zero-immigration agenda by depicting foreign workers as the cause for rising unemployment rates.

Of course this would be nothing new if it were coming from the usual right-wing anti-immigrant websites. But by candy-coating their xenophobic message in outrage against evil corporations, and painting themselves as advocates for working Americans, these groups and their followers have managed to find some resonance on progressive websites.

Of course, those who have followed immigration issues for some time are well aware of the nasty streak of xenophobia that permeates the H1b visa debate.

One look at the Programmers Guild Blog, published by Guild President, Kim Berry, reveals just how much this "tech workers union" has in common with the likes of hate groups like FAIR and NumbersUSA.

Legalizing 12 million illegal immigrants will substantially increase our population: Chain-migration occurs when an immigrant becomes a citizen. Citizens have a legal right to bring in family members other than spouses and children. They can bring in their parents, their adult siblings and the spouses and children of their adult siblings.

...Amnesty is not in the U.S. economic interest:

* The plan would flood in cheap labor that, not only would not pay federal income tax, but would often be entitled to the earned income credit.

* Recent immigrants send over $56 billion back to their home countries each year. Over $15 billion bleeds to Mexico, $25 billion to South America and $16 billion to Asia. (Frosty Woodbridge “America's Death by a Thousand Cuts” March 2007)

* The massive population increase would increase demand for imported oil and consumer goods, further exasperating our energy dependency and trade deficit with China.

...The comprehensive approach permit(s) birthright citizenship anchor-baby to continue. Women from as far a China are making tourist trips to the U.S. to drop an anchorbaby, assuring themselves of a path the U.S. citizenship in the future.

Programmers Guild


But with that said, there are in fact huge problems with H1b program.

So with that in mind I figured it might be a good time to re-visit this issue and republish a story from a while back that looked at the H1b issue in a rational and reasonable way without all the immigrant-bashing so prevalent in the current wave of web posts:

MORE EVIDENCE OF DYSFUNCTIONAL IMMIGRATION POLICY
originally published April 4, 2007

While most Americans spent this past weekend relaxing and enjoying the first days of spring, in the personnel offices of Microsoft, and Infosys and in countless immigration attorney's offices across the country, the yearly frenzy of the H-1b work-visa filing deadline was fast approaching. Many, like San Francisco attorney Gali Schaham Gordon, spent Saturday putting the final touches on the up to 50 pages of forms sometimes required for each applicant.

By the end of the Monday deadline, representatives of the USCIS said the agency had received a record 150,000 applications for the 65,000 visas available for the 2008 federal fiscal year.

Since the yearly cap was hit in one day, immigration officials announced they would accept all the applications filed Monday and Tuesday and place them in a computer-generated lottery to determine who will receive the visas, which are reserved for architects, engineers, computer programmers and other high -skilled workers.

The visa program, which claims to insure that the "best and brightest" from around the world have an opportunity to work in America and eventually become citizens, was reduced in less than 24 hours to a random lottery.

Herein lies an example of the underlying dysfunctional nature of the current immigration system.

Programs, which at face value look totally rational and in fact beneficial, turn out, due to incompetence, abuse, and a lack of true regulation and oversight, to be ineffectual to the point of being detrimental to both the immigrants and the American people.

Started in 1990, the H1b visa program was supposed to allow those with special skills, higher education, and technical expertise to enter the country legally to work and eventually receive permanent residency and citizenship. It was touted as the best way to assure that a future Einstein would not be turned away at the border. This is particularly true in the case of those foreign students who make up half of the graduates of US universities with degrees in engineering and mathematics.

But what has happened in the years since it's inception has nearly insured that the truly "best and brightest" would in fact be turned away, or at best be placed in an immigration limbo of endless paperwork, long waits and lotteries. Utilizing a first-come first served system to issue the visas, last years quota ran out in eight weeks... this year...it took less than a day.

In the meantime, an ever increasing number of corporations use the program, and it's lack regulation and oversight, to pad their workforce with temporary workers earning lower wages with little or no legal recourse. Despite claims of portability and competitive wages, many H-1b holders are locked into jobs that pay below market standards with little chance of mobility to find other employment. They are in essence "owed" by those who sponsor them since changing employers forces those trying to get green cards to start the whole process over again with a new sponsor, a process that can take years of paperwork and bureaucratic red tape.

Yet some businesses love the program. Bill Gates regularly makes pilgrimages to Washington to lobby for increased guest-worker for Microsoft even though about one-third of his 46,000 U.S.-based employees have work visas or are former H1b holders who are now legal permanent residents with green cards, according to company spokeswoman Ginny Terzano. Other tech companies are estimated to use guest workers to fill nearly half their employment needs. Since both the H-1b visas, and the employment based green cards that result from them, are limited each year by quotas, the companies that over-utilize them in effect hold a monopoly over the immigration system.

Surely the intent of the program was not to concentrate larger and larger numbers of temporary workers in an ever-decreasing pool of employers. We have no idea yet how many of the 150,000 applications that flooded the USCIS offices on Monday came from Infosys Technologies, Microsoft and Deloitte & Touche, three of the largest users of H-1Bs according to the Department of Labor's office of foreign labor certification, but it's safe to assume they were once again well represented.

Besides the inherent inequity in the program for the immigrants who rely on H-1b visas to live and work in the country, opponents of the program claim that abuses of the system have allowed corporate sponsors to eliminate older, high-paid US workers to be replaced by cheaper foreign labor. Similarly, smaller US companies see the program as not meeting their needs due to its inefficient implementation.

The current H1-B quota is 65,000, but a series of exemptions make that a soft number. In 2005, the most recent year for which data are available, the U.S. approved 116,927 H1-B visas.

By law, such temporary work permits are normally issued to persons who hold at least a bachelor's degree. Government data show roughly half of people holding H1-Bs meet that minimum. The other half have master's degrees or better, although high school dropouts with vital experience can qualify -- which happened in 2003 when 117 fashion models won H1-B visas.

H1-B work permits run on a fiscal year that begins Oct. 1. Immigration officials say Monday is the soonest they'll accept applications, and employers fear that if they don't file their applications as soon as possible, this first-come, first- served system will exhaust its quota quickly.

...snip...

A similar rush last year forced Seth Sternberg, chief executive of Meebo, to delay some hiring plans. Meebo, a Mountain View developer of a Web site for instant messaging from anywhere, had hoped to add two foreign programmers to its 15-person staff last year. On May 27, the startup filed the paperwork to hire the two people, one from the United Kingdom and the other from Italy. But it turned out that last year's quota had been exhausted the day before Meebo's requests arrived.

"We'll have those applications ready to go day one," Sternberg said last week. He plans to resubmit the visa requests to hire those two same code warriors starting this October

Such frustrations have made an overhaul of the H1-B system a top priority of high-tech leaders.
...snip...

But H1-B critics -- led by older American-born programmers and their academic allies -- say even if U.S. high-tech firms need employees from overseas to stay competitive, the program is flawed in a way that leads to the loss of jobs through outsourcing.

...snip...

... those opposed to lifting the H1-B cap say the present program gives employers all the tools they need to absorb the highly skilled foreign graduates that tech officials talk about, and complain -- with justification -- that the so-called cap of 65,000 is a fiction.

A November report from U.S. Citizenship and Immigration Services puts the basic quota of H1-Bs at 65,000. But the law also says the first 20,000 H1-B applications filed for any masters' degree candidate or higher do not count against that quota. So that gets the number to 85,000. The report adds that "petitions for new H1-B employment are exempt" for foreigners hired to work at universities, nonprofit research institutions or governmental laboratories, and that would push the cap above 85,000.

According to the report, the United States approved 103,584 H1-B visas in fiscal year 2002; 105,314 in 2003; 130,497 in 2004; and 116, 927 in 2005.


San Francisco Chronicle


Both the H-1b program and its companion, the H-2A agricultural guest worker program, have thus far been dismal failures.

The fatal flaw in all these temporary work programs is a glaring lack of regulation, government oversight, enforcement of labor laws and safety regulations, accountability and administration. Thus far the programs already instituted have been abused and misused by employers to the detriment of both immigrant and US workers.

On Monday, as USCIS sorted through an avalanche of H-1b applications, in Washington, Senators Richard Durbin and Chuck Grassley introduced the "H-1B and L -1 Visa Fraud and Abuse Prevention Act of 2007", a bipartisan effort to address the problems of the guest worker program.
The 32-page Senate bill would impose a host of additional obligations on employers. They would be required to pledge that they made a "good faith" effort to hire an American before taking on an H-1B worker and that the foreigner was not displacing a prospective U.S. worker.

Employers would also have to advertise job openings for 30 days on the Department of Labor's Web site before making H-1B visa applications, and they would be prohibited from advertising positions only to H-1B holders.

In addition, companies with 50 or more workers would not be allowed to employ more than half of their staff through H-1B visas.

In an attempt to discourage employers from hiring foreigners at lower wages than their American counterparts would command, employers would have to pay all H-1B workers the "prevailing wage," as calculated by a different method that raises the minimum to a higher level than it currently stands.

The proposal also aims to beef up the Department of Labor's authority to investigate abuses, giving the department the power to conduct random audits on employers, to review applications for "clear indicators of fraud," and to hire 200 additional employees to administer, oversee and enforce the H-1B program.

Grassley described the bill as aimed at "closing loopholes that employers have exploited by requiring them to be more transparent about their hiring and...ensuring more oversight of these visa programs to reduce fraud and abuse."
Cnet.com

Although a step in the right direction, Senators Durbin and Grassley's proposal still falls short of the kind of real protections needed if any guest worker program is to work. Its worker protections, and employer requirements still leave much to be desired.

If in fact we must accept the idea that immigrant workers must be "tried out" on a temporary basis before they are allowed to join the workforce permanently in order to put together a political coalition willing to address immigration reform in any meaningful way, then we must demand that it be done correctly. If in fact our leadership is correct in their assumption that guest workers are key to passing meaningful reform, the protections afforded by the Durbin bill are a good starting point...but far more needs to be done.

Enforcement of ALL labor laws MUST go beyond 200 inspectors looking for guest worker violations.

Any company applying for as little as one guest worker should be required to meet and/or exceed all labor, occupation safety, and workplace regulations.

Just as many businesses must have yearly licensing and inspections by agencies such as the health department or other regulatory bodies, any business employing guest workers should be required to undergo periodic inspection and licensing by the DOL, OSHA, and all other pertinent labor regulatory agencies in order to continue utilizing the program. Those who do not comply should not only face the penalties already in place for workplace violations but have additional harsh penalties placed upon them in regards to guest worker abuse.

Enforcement of labor standards must be the cornerstone on which any sort of guest worker program is accepted.

If we must accept compromises in order to intact meaningful immigration reform, then those compromises must be made by ALL concerned. To ask workers, both immigrant and native-born to accept guest worker programs without true oversight and regulation, while business is allowed to continue as usual should be deemed unacceptable.

If in fact, businesses need these workers on a temporary basis to fill labor needs as they claim, they should be more than willing to assure that they are doing so within the guidelines of new tough, but fair, regulation.

If they oppose such regulation and oversight it can only be because they wish to exploit workers. ... It's as simple as that.

Read More...

Wednesday, April 4, 2007

More evidence of dysfunctional immigration policy

While most Americans spent this past weekend relaxing and enjoying the first days of spring, in the personnel offices of Microsoft, and Infosys and in countless immigration attorney's offices across the country, the yearly frenzy of the H-1b work-visa filing deadline was fast approaching. Many, like San Francisco attorney Gali Schaham Gordon, spent Saturday putting the final touches on the up to 50 pages of forms sometimes required for each applicant.

By the end of the Monday deadline, representatives of the USCIS said the agency had received a record 150,000 applications for the 65,000 visas available for the 2008 federal fiscal year.

Since the yearly cap was hit in one day, immigration officials announced they would accept all the applications filed Monday and Tuesday and place them in a computer-generated lottery to determine who will receive the visas, which are reserved for architects, engineers, computer programmers and other high -skilled workers.

The visa program, which claims to insure that the "best and brightest" from around the world have an opportunity to work in America and eventually become citizens, was reduced in less than 24 hours to a random lottery.

Herein lies an example of the underlying dysfunctional nature of the current immigration system.

Programs, which at face value look totally rational and in fact beneficial, turn out, due to incompetence, abuse, and a lack of true regulation and oversight, to be ineffectual to the point of being detrimental to both the immigrants and the American people.

Started in 1990, the H1b visa program was supposed to allow those with special skills, higher education, and technical expertise to enter the country legally to work and eventually receive permanent residency and citizenship. It was touted as the best way to assure that a future Einstein would not be turned away at the border. This is particularly true in the case of those foreign students who make up half of the graduates of US universities with degrees in engineering and mathematics.

But what has happened in the years since it's inception has nearly insured that the truly "best and brightest" would in fact be turned away, or at best be placed in an immigration limbo of endless paperwork, long waits and lotteries. Utilizing a first-come first-served system to issue the visas, last years quota ran out in eight weeks… this year…it took less than a day.

In the meantime, an ever increasing number of corporations use the program, and it's lack regulation and oversight, to pad their workforce with temporary workers earning lower wages with little or no legal recourse. Despite claims of portability and competitive wages, many H-1b holders are locked into jobs that pay below market standards with little chance of mobility to find other employment. They are in essence "owed" by those who sponsor them since changing employers forces those trying to get green cards to start the whole process over again with a new sponsor, a process that can take years of paperwork and bureaucratic red tape.

Yet some businesses love the program. Bill Gates regularly makes pilgrimages to Washington to lobby for increased guest-workers for Microsoft even though about one-third of his 46,000 U.S.-based employees have work visas or are former H1b holders who are now legal permanent residents with green cards, according to company spokeswoman Ginny Terzano. Other tech companies are estimated to use guest workers to fill nearly half their employment needs. Since both the H-1b visas, and the employment based green cards that result from them, are limited each year by quotas, the companies that over-utilize them in effect hold a monopoly over the immigration system.

Surely the intent of the program was not to concentrate larger and larger numbers of temporary workers in an ever-decreasing pool of employers. We have no idea yet how many of the 150,000 applications that flooded the USCIS offices on Monday came from Infosys Technologies, Microsoft and Deloitte & Touche, three of the largest users of H-1Bs according to the Department of Labor's office of foreign labor certification, but it's safe to assume they were once again well represented.

Besides the inherent inequity in the program for the immigrants who rely on H-1b visas to live and work in the country, opponents of the program claim that abuses of the system have allowed corporate sponsors to eliminate older, high-paid US workers to be replaced by cheaper foreign labor. Similarly, smaller US companies see the program as not meeting their needs due to its inefficient implementation.

The current H1-B quota is 65,000, but a series of exemptions make that a soft number. In 2005, the most recent year for which data are available, the U.S. approved 116,927 H1-B visas.

By law, such temporary work permits are normally issued to persons who hold at least a bachelor's degree. Government data show roughly half of people holding H1-Bs meet that minimum. The other half have master's degrees or better, although high school dropouts with vital experience can qualify -- which happened in 2003 when 117 fashion models won H1-B visas.

H1-B work permits run on a fiscal year that begins Oct. 1. Immigration officials say Monday is the soonest they'll accept applications, and employers fear that if they don't file their applications as soon as possible, this first-come, first- served system will exhaust its quota quickly.

…snip…

A similar rush last year forced Seth Sternberg, chief executive of Meebo, to delay some hiring plans. Meebo, a Mountain View developer of a Web site for instant messaging from anywhere, had hoped to add two foreign programmers to its 15-person staff last year. On May 27, the startup filed the paperwork to hire the two people, one from the United Kingdom and the other from Italy. But it turned out that last year's quota had been exhausted the day before Meebo's requests arrived.

"We'll have those applications ready to go day one," Sternberg said last week. He plans to resubmit the visa requests to hire those two same code warriors starting this October

Such frustrations have made an overhaul of the H1-B system a top priority of high-tech leaders.
…snip…

But H1-B critics -- led by older American-born programmers and their academic allies -- say even if U.S. high-tech firms need employees from overseas to stay competitive, the program is flawed in a way that leads to the loss of jobs through outsourcing.

…snip…

… those opposed to lifting the H1-B cap say the present program gives employers all the tools they need to absorb the highly skilled foreign graduates that tech officials talk about, and complain -- with justification -- that the so-called cap of 65,000 is a fiction.

A November report from U.S. Citizenship and Immigration Services puts the basic quota of H1-Bs at 65,000. But the law also says the first 20,000 H1-B applications filed for any masters' degree candidate or higher do not count against that quota. So that gets the number to 85,000. The report adds that "petitions for new H1-B employment are exempt" for foreigners hired to work at universities, nonprofit research institutions or governmental laboratories, and that would push the cap above 85,000.

According to the report, the United States approved 103,584 H1-B visas in fiscal year 2002; 105,314 in 2003; 130,497 in 2004; and 116, 927 in 2005.

"It sure looks like they're issuing a hell of a lot more visas than they ought to be," said John Miano, an attorney and H1-B critic from New Jersey.

If hiring the best and brightest is the goal, Miano said, the data show that the current program misses the mark because it awards most H1-B visas to people with bachelor's degrees (45 percent in the most recent year, down from 49 percent the prior year) who come from low-wage countries (India tops at 44.4 percent, China second at 9.2 percent).

Sacramento software engineer Kim Berry, president of the Programmers Guild -- which he describes as "disproportionately over age 40 and disproportionately underemployed" -- said it's tough for U.S. tech workers to see jobs going to H1-Bs.

San Francisco Chronicle

The recently introduced "Security Through Regularized Immigration and a Vibrant Economy (STRIVE) Act", the House bill, sponsored by Reps. Luis V. Gutierrez (D-Ill.) and Jeff Flake (R-Ariz.), includes a provision to lift the cap on H-1b visas to 115,000 as part of a comprehensive overhaul of immigration law. But without any real improvements in regulation and enforcement of the program, the STRIVE Act as currently written would only exacerbate an already bad situation.

Both the H-1b program and its companion, the H-2A agricultural guest worker program, have thus far been dismal failures. The same should be expected of the proposed H-2C guest worker program that would allow for 400,000 unskilled and non-specialty workers to enter the country.

The fatal flaw in all these temporary work programs is a glaring lack of regulation, government oversight, enforcement of labor laws and safety regulations, accountability and administration. Thus far the programs already instituted have been abused and misused by employers to the detriment of both immigrant and US workers.

On Monday, as USCIS sorted through an avalanche of H-1b applications, in Washington, Senators Richard Durbin and Chuck Grassley introduced the "H-1B and L -1 Visa Fraud and Abuse Prevention Act of 2007", a bipartisan effort to address the problems of the guest worker program.
The 32-page Senate bill would impose a host of additional obligations on employers. They would be required to pledge that they made a "good faith" effort to hire an American before taking on an H-1B worker and that the foreigner was not displacing a prospective U.S. worker.

Employers would also have to advertise job openings for 30 days on the Department of Labor's Web site before making H-1B visa applications, and they would be prohibited from advertising positions only to H-1B holders.

In addition, companies with 50 or more workers would not be allowed to employ more than half of their staff through H-1B visas.

In an attempt to discourage employers from hiring foreigners at lower wages than their American counterparts would command, employers would have to pay all H-1B workers the "prevailing wage," as calculated by a different method that raises the minimum to a higher level than it currently stands.

The proposal also aims to beef up the Department of Labor's authority to investigate abuses, giving the department the power to conduct random audits on employers, to review applications for "clear indicators of fraud," and to hire 200 additional employees to administer, oversee and enforce the H-1B program.

Grassley described the bill as aimed at "closing loopholes that employers have exploited by requiring them to be more transparent about their hiring and...ensuring more oversight of these visa programs to reduce fraud and abuse."
Cnet.com

Although a step in the right direction, Senators Durbin and Grassley's proposal still falls short of the kind of real protections needed if any guest worker program is to work. Its worker protections, requirements to qualify for guest workers, and protections of US workers still leave much to be desired.

If in fact we must accept the idea that immigrant workers must be "tried out" on a temporary basis before they are allowed to join the workforce permanently in order to put together a political coalition willing to address immigration reform in any meaningful way, then we must demand that it be done correctly. The protections afforded by the Durbin bill are a good starting point…but far more needs to be done.

Enforcement of ALL labor laws MUST go beyond 200 inspectors looking for guest worker violations.

Any company applying for as little as one guest worker should be required to meet and/or exceed all labor, occupation safety, and workplace regulations.

Just as many businesses must have yearly licensing and inspections by agencies such as the health department or other regulatory bodies, any business employing guest workers should be required to undergo periodic inspection and licensing by the DOL, OSHA, and all other pertinent labor regulatory agencies in order to continue utilizing the program. Those who do not comply should not only face the penalties already in place for workplace violations but have additional harsh penalties placed upon them in regards to guest worker abuse.

Enforcement of labor standards must be the cornerstone on which any sort of guest worker program is accepted.

If we must accept compromises in order to intact meaningful immigration reform, then those compromises must be made by ALL concerned. To ask workers, both immigrant and native-born to accept guest worker programs without true oversight and regulation, while business is allowed to continue as usual should be deemed unacceptable.

If in fact, businesses need these workers on a temporary basis to fill labor needs as they claim, they should be more than willing to assure that they are doing so within the guidelines of new tough, but fair, regulation. If they oppose such regulation and oversight it can only be because they wish to exploit both US and immigrant workers. … It's as simple as that.

Related:
Demand for H-1B visas exceeds limit, San Jose Mercury News

U.S. reaches 2008 cap for skilled-worker visa petitions in single day, Seattle Times

U.S. Companies Race to Fill Quota of Coveted Technology Worker Visas, Washington Post

Statement by AFL-CIO President John J. Sweeney on the Introduction of the H-1B and L-1 Visa Fraud and Abuse Prevention Act


Senate bill gives Americans preference for tech jobs, Cnet.com

Tech firms scramble for visas, San Francisco Chronicle

Overveiw of STRIVE Act, Migra Matters

Southern Poverty Law Center finds guest worker program close to slavery, Migra Matters

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Friday, January 5, 2007

Studies show immigrants driving force in tech growth

For the most part, the debate over immigration reform has centered on the influx of millions of low-skilled, economic migrants entering the country without documentation to take jobs in agriculture, construction and service industries.

Yet, behind the scenes, a controversy has been raging that does not deal with those who entered the country illegally, but rather with those who have entered through legal channels with visas issued for work. The debate over reform of the work visa program, and particularly H1b specialty visas, has been the most contentious of all. The H-1B visa program allows American companies and universities to hire foreign scientists, engineers, computer programmers and other high-skilled workers. In 2003, in response to the bursting tech bubble, the yearly cap on H1b visa was decreased from 195,000 to 65,000. Since then a war of words has raged between businesses who claim they must have access to the worlds brightest minds and professional organization and unions that feel the H1b system is too easily manipulated by corporate interests to the detriment of US workers.

A couple of new studies shed some light on this debate

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As with all things immigration related, there are arguments on both sides of this debate that are black and white … but as usual the truth lies in the area that is considerably more gray.

Do H1b workers lower the wages of native-born tech workers? Do US businesses need these workers for their special skills? Compelling arguments have been made on both sides of the issue. Just like the arguments over the economic benefits and costs of undocumented, low-skilled workers, the arguments for and against these highly educated, skilled workers cannot be viewed in a vacuum devoid of the complexities of long term economic and societal trends.

Two complementary studies have recently been released looking at one long term effect of immigration of high skilled workers. "American Made: The Impact of Immigrant Entrepreneurs and Professionals on U.S. Competitiveness", released last November by the National Venture Capital Association, looked at immigrant participation in launching venture capital backed business, and "America’s New Immigrant Entrepreneurs", released yesterday by Duke Universities Pratt School of Engineering and University of California, Berkeley, examined the role immigrants have played in engineering and technology company start-ups from 1995-2005. Both studies concluded that immigrants, and the H1b visas that allow them to work and live in the US, have played a major role in creating many of the companies and jobs that keep the tech industry running.

"America's New Immigrant Entrepreneurs'' found that nationwide, 25 percent of all tech and engineering start-ups have founders who are immigrants while "American Made: The Impact of Immigrant Entrepreneurs and Professionals on U.S. Competitiveness" found that 47 percent of venture-backed start-ups were started by foreign born entrepreneurs. These numbers are striking given the fact that the foreign-born represent only 11.7% of the total population.

The Duke study looks at two main aspects of immigrant contributions to the economy; companies started by immigrants and international patents issued to immigrant inventors.


What is clear is that immigrants have become a significant driving force in the creation of new businesses and intellectual property in the U.S. — and that their contributions have increased over the past decade.

Here are some characteristics of the engineering and technology companies started in the U.S. from 1995 to 2005.
  • In 25.3% of these companies, at least one key founder was foreign-born. States with an above-average rate of immigrant-founded companies include California (39%), New Jersey (38%), Georgia (30%), and Massachusetts (29%). Below average states include Washington (11%), Ohio (14%), North Carolina (14%), and Texas (18%).

  • Nationwide, these immigrant-founded companies produced $52 billion in sales and employed 450,000 workers in 2005.

  • Indians have founded more engineering and technology companies in the US in the past decade than immigrants from the U.K., China, Taiwan and Japan combined. Of all immigrant-founded companies, 26% have Indian founders.

  • Chinese (Mainland- and Taiwan-born) entrepreneurs are heavily concentrated in California, with 49% of Mainland Chinese and 81% of Taiwanese companies located there. Indian and U.K. entrepreneurs tend to be dispersed around the country, with Indians having sizable concentrations in California and New Jersey and the British in California and Georgia.

  • The mix of immigrants varies by state. Hispanics constitute the dominant group in Florida, with immigrants from Cuba, Columbia, Brazil, Venezuela, and Guatemala founding 35% of the immigrant-founded companies. Israelis constitute the largest founding group in Massachusetts, with 17%. Indians dominate New Jersey, with 47% of all immigrant-founded startups.

  • Almost 80% of immigrant-founded companies in the US were within just two industry fields: software and innovation/manufacturing-related services.

  • Immigrants were least likely to start companies in the defense/aerospace and environmental industries. They were most highly represented as founders in the semiconductor, computer, communications, and software fields.


…based on an analysis of the World Intellectual Property Organization (WIPO) patent databases, that foreign nationals residing in the U.S. were named as inventors or co-inventors in 24.2% of international patent applications filed from the U.S. in 2006.

Over half (52.4%) of Silicon Valley startups had one or more immigrants as a key founder, compared with the California average of 38.8%.

"America’s New Immigrant Entrepreneurs"

Duke researchers started with a list of 28,766 companies founded in the U.S. in the last ten years classified as technology and engineering companies in Dun and Bradstreet's Million Dollar Database. The list contains U.S. companies with more than $1 million in sales, and 20 or more employees, and company branches with 50 or more employees. This database is commonly used by researchers and is considered a reliable source. Researchers were able to reach senior executives to determine the backgrounds of key founders for 2,054 of the tech startups.

This study builds on the 1999 research of AnnaLee Saxenian, dean of the School of Information at UC-Berkeley, which focused on the development of Silicon Valley’s regional economy and the role immigrant capital and labor in the process. “Silicon Valley’s New Immigrant Entrepreneurs” found that that Chinese and Indian engineers ran a growing share of Silicon Valley companies and they were at the helm of 24% of the technology businesses started from 1980 to 1998.

The study from NVCA, although obviously from a more partisan source than the other studies, compliments and highlights much of the same ground covered by both Saxenian in 1999 and the current Duke/Berkley study. Using the Thomson Financial database the authors surveyed over 340 privately held venture-backed companies to discern the demographic data on their founders.


Immigrant-Founded Public Venture-Backed Companies

  • Over the past 15 years, immigrants have started 25 percent of U.S. public companies that were venture-backed, a high percentage of the most innovative companies in America.


  • The current market capitalization of publicly traded immigrant-founded venture-backed companies in the United States exceeds $500 billion, adding significant value to the American economy. This is an example of the enormous wealth-creating abilities of immigrant entrepreneurs.


  • Immigrant-founded venture-backed companies are concentrated in cutting edge sectors: high-technology manufacturing; information technology (IT); and life sciences.


  • As evidence of how important immigrant entrepreneurs have been to the U.S. technology base, the study found 40 percent of U.S. publicly traded venture-backed companies operating in high-technology manufacturing today were started by immigrants. Moreover, more than half of the employment generated by U.S. public venture-backed high-tech manufacturers has come from immigrant-founded companies.


  • The largest U.S. venture-backed public companies started by immigrants include Intel, Solectron, Sanmina-SCI, Sun Microsystems, eBay, Yahoo!, and Google.


  • The data shows immigrants possess great entrepreneurial capacity, particularly in technical fields. The proportion of immigrant entrepreneurs among publicly traded venture backed companies is particularly impressive when compared to the relatively small share of legal immigrants in the U.S. population. Today, legal immigrants encompass approximately 8.7 percent of the U.S. population and represented only 6.7 percent of the population in 1990.


  • Most venture-backed companies started by immigrant entrepreneurs are technology-related companies that pay high salaries for white collar professional positions but employ fewer people than, for example, venture-backed retail stores such as The Home Depot or Starbucks.


  • Immigrant-founded venture-backed public companies today employ an estimated 220,000 people in the United States and over 400,000 people globally.


  • While immigrant founders in venture-backed public companies come from across the globe, the leading countries of origin are India, Israel, and Taiwan.


  • California is the leading state by headquarters for immigrant-founded venture-backed public companies, followed by Massachusetts, New Jersey, Washington, and Texas.


  • A key lesson of the study is the importance of maintaining an open legal immigration system. Few of the immigrant entrepreneurs identified came to America ready to start a company capable of attracting venture capital. As the data, profiles, and interviews revealed, most entered the country either as children, teenagers, or graduate students, or were hired on H-1B visas to begin a first job while in their mid-twenties.


NVCA conducted a survey, with 342 respondents, to gather data on immigrant entrepreneurs at today’s smaller, private venture-backed companies and to gain a wider perspective on company viewpoints on immigration.

  • Looking to the future, among today’s cutting edge privately held venture-backed companies, the percentage of immigrant founders remains as high, if not higher than their public counterparts. Of those responding to the NVCA survey, nearly half (47 percent) of the founders of private companies were immigrants.


  • In one important indicator of the job creation abilities of immigrants, the NVCA survey found that almost two-thirds (66 percent) of the immigrant founders of privately held venture backed companies have started or intend to start more companies in the United States.


  • Immigrant-founded privately held companies in the survey held an average of 14.5 patents, with a median of four. This was slightly higher than the number of patents held by companies responding with exclusively U.S.-born founders.


  • Private immigrant-founded venture-backed companies mirror public companies in their location and industry concentration, with 56 percent of the emerging companies headquartered in California.


  • The top industry sectors for private immigrant founded venture-backed companies were software, semiconductors, and biotechnology.


  • India was the most common place of birth for foreign-born founders in the survey, followed by the United Kingdom, China, Iran, and France.


  • Nearly all the immigrant founders in private companies (95 percent) would still start their companies in the United States if given the choice today.


American Made: The Impact of Immigrant Entrepreneurs and Professionals on U.S. Competitiveness

One reason for the disproportionate amount of immigrants leading US tech firms might be found in some data from Saxenian's 1999 study.


Not surprisingly, Silicon Valley's Indian and Chinese workforce is highly educated. In 1990, they earned graduate degrees at significantly greater rates than their white counterparts: 32 percent of the Indian and 23 percent of the Chinese employed in Silicon Valley in 1990 had advanced degrees, compared to only 11 percent for the white population. Their superior educational attainment is even more pronounced in technology industries: 55 percent of Indian and 40 percent of Chinese technology workers held graduate degrees, compared to 18 percent of whites.
Silicon Valley’s New Immigrant Entrepreneurs

This educational gap between US and foreign workers was also noted in testimony before the Senate Judiciary Committee back in September of 2005 when the Subcommittee on Immigration, Border Security, and Claims was investigating the possibility of foreign nationals engaging in economic or military espionage. William A. Wulf, Ph.D., President of the National Academy of Engineering warned of the growing educational gap between US workers and their foreign counterparts.


After WW II, the U.S. forged a mutually reinforcing triad of complementary R&D strengths in industry, academia and government. However, U.S. industrial laboratories have greatly reduced their support for long-term basic research; and many U.S. corporations are shifting research and development to overseas locations—not just because foreign labor is cheaper, as is the common and comfortable myth, but because it is of higher quality! U.S. government laboratories are in various states of disarray, and no longer maintain the stature that they did in 1960’s. Government support for the physical sciences and engineering at universities has declined in real terms, and is suffering further under present budget pressures – clearly, a strong research capability is not a current federal priority. Enrollment in the physical sciences and engineering, as a percentage of undergraduates, is among the lowest in the industrialized world – the U.S. now graduates just 7% of the world’s engineers, for example. Given that our 12th graders score among the lowest in the world in science and mathematics, the ranks of U.S. born scientists and engineers are not likely to expand dramatically anytime soon. Our once strong triad of R&D capabilities is crumbling.

At the same time, science and technology are growing rapidly in other parts of the world. Over 70% of the papers published in the American Physical Society’s world leading journals, The Physical Review and Physical Review Letters, now come from abroad

The Importance of Foreign-born Scientists and Engineers to the Security of The United States

As stated earlier, nothing about immigration and the debate that swirls around it is ever easy to analyze in simple terms of black and white. These entrepreneurs and the businesses and jobs they create are only one small part of the big immigration puzzle. Clearly they have made great contributions to our economy and society, but the H1b story is complex and multifaceted. Next month the anti-immigration advocacy group, Center for Immigration Studies (CIS) will be issuing their own study on H1b visas and their effects on the economy. Their finding…the bulk of H1b visas are issued to low-level workers that receive low wages that undercut US workers.

All I can say is ….you be the judge.

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