Study: Visa law prevents companies from hiring best workers

Chinese citizens wait to submit their visa applications at the U.S. Embassy where blind rights activist Chen Guangcheng is believed to be hiding, in Beijing on May 2, 2012.

There’s a lot of talk about outsourcing these days. But what about all those workers -- especially the highly skilled ones -- that companies like to bring into the country?

A new report out today from the Brookings Institution found that many employers in the U.S. aren’t in fact able to hire all the workers that they’d like to.

The H-1B visa program is one that allows workers from foreign countries with specialized skills to come work in the U.S. for a temporary amount of time (granted in three-year increments).

But Brookings found that this system of capping the amount of visas is having big impacts in some places that need a lot more of these workers than others: Demand almost always exceeds supply.

The biggest demand comes from places like Silicon Valley, but also academic hot spots like Ann Arbor, Mich. and Durham, N.C. (Academic and research institutions are not subject to the cap, according to the Brookings Institution. But these cities also are home to many private companies started by local graduates.)

“In Columbus, Ind. as well as Peoria, Ill., a very high share of their requests for H1-B visas are in science, technology, engineering and math,” says Neal Ruiz at Brookings. “In the heartland of America, there's a need for high skilled in American manufacturing.”

The biggest sectors taking advantage of these H-1B visas are science, technology, engineering and math. Most of the foreign workers, at this point, are coming from India and China, and are computing experts.

See below for the companies, cities, and industries seeking the most H-1B visas.

Top Employers Requesting H-1B Workers (2010-2011 average share)
1. Microsoft Corporation
2. Tata Consultancy Services Limited
3. Deloitte Consulting
4. Wipro Limited
5. Cognizant Technology Solutions
6. Larsen & Toubro Limited
7. IBM India
8. Infosys Limited
9. Intel Corporation
10. IBM Corporation

***The top ten companies account for 7.32% share of H-1B requests

Top Occupation Groups for H1-B Workers
1. Computer Occupations 46.8%
2. Engineers 8.2%
3. Health Diagnosing and Treating Practitioners 6.4%
4. Financial Specialists 5.7%
5. Business Operations Specialists 4.0%
6. Life Scientists 3.7%
7. Social Scientists and Related Workers 2.4%
8. Postsecondary Teachers 2.4%
9. Operations Specialties Managers 2.2%
10. Other Management Occupations 2.2%

Top Metropolitan Areas for H1-B Worker Demand Intensity (Intensity is H1-B workers/total jobs in the area)
1. San Jose-Sunnyvale-Santa Clara, CA
2. Columbus, IN
3. Durham-Chapel Hill, NC
4. Trenton-Ewing, NJ
5. San Francisco-Oakland-Fremont, CA
6. Bloomington-Normal, IL
7. New York-Northern New Jersey-Long Island, NY-NJ-PA
8. Bridgeport-Stamford-Norwalk, CT
9. Seattle-Tacoma-Bellevue, WA
10. Washington-Arlington-Alexandria, DC-VA-MD-WV

Data Credit: Brookings Institute, LCA database, Department of Labor

Katie Long and Mary Dooe contributed to this report.

Jeremy Hobson: Well let's get to that job story. There's a new report out today that's got one explanation for why companies aren't hiring the people they want to hire: A visa program to bring in the best and brightest from around the world is capped, and doesn't account for the economic geography of America.

Marketplace's Scott Tong is with us live from Washington to explain. Good morning.

Scott Tong: Good morning Jeremy.

Hobson: What job sectors are we talking about in this study?

Tong: Well, Jeremy, you have heard about the STEM occupations, right? Science, tech, engineering, math. American companies and universities, they want the best in the world. So there's this visa program called H1-B that lets in a certain number of these highly skilled workers into the U.S. -- we're talking mostly computing experts; mostly from India and China. And demand almost always succeeds supply; there's a cap on these visas. Today the folks at the Brookings Institution issue a report that looks at this supply/demand mismatch, not just around the country, but city by city.

Hobson: And do we have a sense of what they've found at the Brookings Institution?

Tong: A few not so surprising -- lots of demand from Silicon Valley, duh. But also smaller, academic places like Ann Arbor, Mich.; Durham N.C. request a lot of these visas.

And Neal Ruiz at Brookings notes a couple areas that have big companies that you may not have thought much about.

Neal Ruiz: In Columbus, Ind. as well as Peoria, Ill., a very high share of their requests for H1-B visas are in science, technology, engineering and math. In the heartland of America, there's a need for high skilled in American manufacturing.

So one point the report makes, Jeremy, is that when employers hire these high-tech workers, they pay into a pot. But that money doesn't always get recycled into these emerging high-tech cities.

Hobson: Marketplace's Scott Tong in Washington, thanks a lot.

Tong: You're welcome.

About the author

Scott Tong is a correspondent for Marketplace’s sustainability desk, with a focus on energy, environment, resources, climate, supply chain and the global economy.

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