Microsoft's call for more H-1B visas and green cards draws ire

The Economic Policy Institute asserts that Microsoft's claims of a U.S. IT labor shortage are disingenuous and self-serving

Claiming the United States doesn't have enough skilled IT workers to meet American companies' increasing demands, Microsoft has called on the feds to issue 20,000 more H-1B visas and 20,000 additional green cards per year to help fill the gap.

The recommendation does not sit well with the Economic Policy Institute (EPI), which has accused Microsoft of fudging the labor numbers to create the illusion of a STEM (science, technology, engineering, and math) skills shortage. The EPI argues that opening the floodgates to IT talent from overseas will exacerbate STEM unemployment rates in the United States.

In a recently released reported titled "A National Talent Strategy: Ideas for Securing U.S. Competitiveness and Growth" [PDF] Microsoft asserted that there's an urgent demand for STEM-trained workers throughout the country, yet there aren't enough people with the right skills to meet that demand:

As the company that spends more on research and development (R&D) than any other in the world, Microsoft sees these problems firsthand. Like companies across the information technology sector, we are opening up new jobs in the United States faster than we can fill them. We now have 6,000 open jobs in the country, an increase of 15 percent over the past year. Over 3,400 of these jobs are for researchers, developers, and engineers, and this total has grown by 34 percent over the past 12 months.

Making matters worse, Microsoft claimed that "too few American students are achieving the levels of education required in innovation-based industries." Citing figures from the U.S. Department of Education's National Center for Education Statistics (NCES), Microsoft warned that between 2010 and 2020, the U.S. economy will produce more than 120,000 additional computing jobs requiring at least a bachelor's degree -- but the country's higher-education system is currently producing only 40,000 bachelor's degrees in computer science each year.

Microsoft laid out a two-prong solution to the problem. For the long term, the company suggested greater investment in improving STEM education, from the kindergarten level on up through the college level. But for the short term, in order to address the purported shortage of IT talent in the American workforce, Microsoft recommended that Congress enact "targeted high-skilled immigration reform," which would entail "creating a new, supplemental allocation of 20,000 visas annually for STEM skills that are in short supply" and "making a supplemental allocation of 20,000 new green card slots annually for workers with STEM skills."

The company also recommended that organizations be required to pay $10,000 for each new STEM visa and $15,000 for each new STEM green card, totaling $500 million per year that could go toward investing in STEM education.

Microsoft's recommendations did not sit well with the EPI, which describes itself as a nonprofit, nonpartisan think tank focused on "broadening discussions about economic policy to include the needs of low- and middle-income workers." In a scathing response to Microsoft's proposal, titled "STEM labor shortages? Microsoft report distorts reality about computing occupations," attorney and immigration policy analyst Daniel Costa picked apart the company's assertion that the country doesn't have enough skilled techies to meet current or future demands.

For starters, Costa argues that college-graduation rates aren't a useful yardstick for measuring the size of the STEM talent pool. "Less than one-fourth to less than one-half of workers in computing occupations have a computer science degree," Costa argues, citing data from sources such as the National Science Foundation (NSF).

Second, Costa contradicts Microsoft's claim that the "unemployment in computer-related occupations has fallen to just 3.4 percent, or less than the traditional rate for 'full-employment' [of 4 percent]." Microsoft claims that a lower-than-normal employment rates points to a talent shortage. According to Costa, the traditional full employment rate for just computer scientists and engineers -- rather than all U.S. workers across all industries -- traditionally peaks at around 2 percent, based on data from the Current Population Survey (CPS) public data series and the Bureau of Labor Statistics.

Third, Costa argues that STEM wages have remained relatively stagnant from 2000 through 2011. "The average hourly wage for college-educated workers in computer and math occupations rose 5.3 percent over 11 years, from $37.27 in 2000 to $39.24 in 2011 (in 2012 dollars), which translates to an average wage increase of less than half a percent per year," he wrote, citing an EPI analysis of Current Population Survey basic monthly microdata. His point: Tech and engineering wages would have risen dramatically over the past decade if there was a dearth of skilled workers, per the laws of supply and demand.

Finally, Costa cautions that granting Microsoft's request for more H-1B visas and STEM green cards "would propel unemployment rates in these occupations even higher, absent substantial new job creation. This is because unemployment rates for these workers are approximately double where they would stand if these labor markets were at full employment. These higher unemployment rates will keep wages from rising, which may be a desirable outcome for Microsoft but not for workers or the U.S. economy."

Costa's parting shot to Microsoft:

When the economy is operating near full employment, it might be sensible to adjust public policies to help employers secure additional workers to keep the economy growing at full speed ... . Until then, the nation would be better served if Microsoft filled its 3,400 job openings for 'researchers, developers and engineers' by hiring and retraining some of the 141,000 unemployed workers in computer occupations who are actively looking for work around the country.

This story, "Microsoft's call for more H-1B visas and green cards draws ire," was originally published at InfoWorld.com. Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow InfoWorld.com on Twitter.

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