56

U.S. should import more skilled workers

Commentator Will Wilkinson

TEXT OF COMMENTARY

Scott Jagow: A new report says that within seven years, the U.S. needs hundreds of thousands of new graduates in math and science fields. That's to keep up with the rest of the world.

But commentator Will Wilkinson says an advanced degree in science won't necessarily protect Americans from cut-throat competition.


Will Wilkinson: If you're a highly-skilled worker, America needs you. But if you've got a foreign passport, we probably won't let you in.

The U.S. issues only 65,000 H-1B visas for skilled workers each year and that's not very many. Senators McCain and Obama have both said they would support raising the cap. They acknowledge we need more skilled workers, and they're right. Yes, it would be good for innovation and growth and it would bring down the prices of goods created by skilled workers, but here's another reason you might not have thought of: Wage inequality.

Increases in wage inequality over the past few decades is primarily a story of the supply and demand of skilled labor together with the effects of technological innovation. Wage increases tend to track improvements in the productivity of labor and gains in productivity tend to be driven by innovations that help workers do more in less time. But in recent decades, technical innovation has increased the productivity of more highly-educated workers faster than it has for less-educated workers. These growing inequalities in productivity have helped create growing inequalities in wages.

But that's not the whole story. The American system of higher education produces skilled workers too slowly to keep up with the demand. This scarcity in the supply bids up the wages of the well-educated even more, further widening the wage gap. If we raised visa quotas on skilled labor, that would help bring supply in line with demand and reduce the wage gap between more and less skilled workers.

These days, almost everybody but their beneficiaries think agricultural subsidies are a lousy idea. They benefit a few already relatively wealthy American farmers and agribusiness firms to the detriment of poor farmers around the world. But H-1B visa restrictions are subsidies that benefit relatively rich domestic workers over their poorer foreign peers, and so it turns out many of us liberal-minded college grads are enjoying our own protectionist boost.

In this case, it seems the moral outrage is... well, we seem to be keeping it to ourselves.


Jagow: Will Wilkinson is a research fellow at the Cato Institute.

Log in to post56 Comments

Pages

I welcome all the support against H1bs and immigrants. If America for once and for all decides to keep everyone out then people can go back to their countries and improve it. This way America is no longer this head-strong country. The ground situation is that not many students are taking up math and science. I have TAed for EE101 and seen that 90% of the students (specially the <24 category) struggle with math - differential calculus in the course to be specific.
All the students i know at the Master's level have jobs (American and International) and earn well. I earn ~ $80000 and unless all of you feel that it is too low for a new grad in Sacramento I don't agree with the impact of h1bs most people are talking about.
Also while interviewing I have seen that these international students had the edge over citizens because all of them were ready to move to any place with opportunity but my own friends were not. How do I blame the international students for looking more favourable.
Home grown talent is important - but shuting our doors is just not going to solve the problem - it will only send all the jobs out.
Impossible you say - look at the fiscal situation, if other countries no longer buy american bonds, which they will once they have their own self-sustaining economies, they will stop investing in america and the economy will start seeing the real bottom.

Maybe there was a time when the best and brightest were coming to this country. However, that is not the case any more. The H-1Bs that are now entering this country have average skills at best. We import cheap labor (H-1Bs) with average skills and at home drive the truly best and brightest engineering candidates to other careers. What we will be left with is a bunch of engineers with average abilities. The U.S. is going to lose it's technological lead BECAUSE of H-1Bs. The indigenous engineering infrastructure of this country is being undermined by corporate greed, ignorant columnists, and shameless groups like the Cato Institute who are mouth pieces for anyone willing to write a big enough check.

I cannot believe that this piece aired when the economy is in the middle this massive economic downturn.

Corporate America should not be allowed to continue benefiting from selling their goods and services in this very lucrative $13 trillion economy but then saying that American workers are too expensive to hire.

I am all in favor of importing those who hold advanced PhD qualifications in science and engineering but the majority of H1-B workers are not exceptionally talented.

Corporate America is out to reduce the wages of the American worker who have invested many years and tens of thousands of dollars to get an education only to find the competition for jobs becoming more and more intense.

The US immigration system is flawed. The H1-B program should be eliminated and instead, people with advanced degrees (not merely Bachelor's degrees), should be able to migrate to the US under a skilled migration program.

Like many other important issues (Iraq war, Climate Change, etc.), the issue of importing skilled workers is complex one. But, unlike many who commented on this story, I'd just like to politely put my two cents in.

In the same way US imports tons of materials and goods, American companies have to import talent to stay on top of the game. But what seems to be annoying many Americans is the importing of skilled people, but not importing of zillions of tons of materials and goods from all over the world at a huge cost to life on earth. Whether it is importing of people or of materials, the rationale behind it is economics.

By the way, I am not sure if we can call companies like Microsoft or GE or GM or P&G or Pfizer (the list goes on and on) 'American' just because they are headquartered in the US. The more appropriate term would probably be 'multi-national'. Now, what exactly is the problem when MULTI-NATIONAL companies that operate and sell products in dozens of countries import a small portion of their employees to the US??? Uncle Sam should savor a big slice of their $$$ cake, but should not allow the corporations to import people?!?

Yes, there is a lot of room for improvement in the American education system and the society, but is it wise to direct that furstration on H1-B visas and turn to protectionism? Isn't that diametrically opposite to what the US has been preaching to the world since decades? Isn't free-market capitalism one of the pillars of America and its prosperity?

The number of visas to be granted each year is certainly debatable, but the concept behind it is not sinister, as some people seem to be imagining.

Any skilled worker who works for an American company and is capable of developing technological advances, perhaps the kind that earn U.S. patents...it's a no-brainer. Societies are only as good as their tools will allow.

Strict laws and regulations didn't help the Titanic as it was sinking! What is going to save our economy..., now that we realize how addicted we are to foreign oil, only market forces and technological innovation.

When those tech-jobs go over seas, so does the knowledge along with the dollars, which end up benefiting foreign interests.

EX: What if Michael Jordan had been born in another country...? Would we have let him in? Right!

Will makes a great argument. The hostile reception, as indicated by the comments, should be unsurprising. If people actually understood how much immigration has historically benefited us then we wouldn't have the type of protectionist immigration laws we have. The comments only confirm that people only dislike protectionism when it keeps them on the outside. If less protectionism (ostensibly) harms them, then they feel threatened. If the borders were opened one might see a drop in wages, but considering there would be a correlative drop in prices, it's doubly there would be an overall harm, and most likely considerable benefit. It's likely that it would also create an increase in jobs and new opportunities with more rapid development of technology.

I think the primary reason why Americans don't pursue as many science and engineering degrees is simply because they're just not as attractive, not as sexy to college students, who want to study in the humanities, which they find far more interesting and which generally have more lax grading standards and easier classes. The US is fortunately wealthy enough as an economy and a country that it can afford to expensively educate youngsters in realms of knowledge they have no use for. This is a good thing. Why else pursue wealth except for such luxuries?

In the end, all I can say is I'm sorry you've gotten so many hostile comments. It's not these people are stupid, just ignorant of economics, which can at times be a fairly counter-intuitive discipline and one which few students are exposed to. Thanks for the encouraging comments. Hope they get spread around more.

I was appalled at Mr. Wilkinson's statement that the “American system of higher education produces skilled workers too slowly to keep up with demand.” I am familiar with numerous "technical" graduate programs in this country, both in the past and present, and none have had any shortage of foreign graduate students. If our education system has enough space to educate foreign graduate students, why then is it unable to produce more American students to fill the demand for these well paid technical jobs? Certainly, American students are no less interested in having well paid careers than their foreign peers.

Clearly, not enough American students are being admitted to American technical graduate programs to keep them full. Our vast system of undergraduate colleges and universities are not turning out enough students that are both interested in and qualified to compete for these graduate school openings. It is relatively easy to identify potential causes for this shortage. Many of our college-bound high school students graduate with inadequate math and science skills to perform well in college programs; most continue to fall even farther behind in college with no chance to catch up. Some very qualified college students are either unwilling or unable to put in the four to six years that it will take to earn a Ph.D. For some people, it may be the result of debt incurred for their undergraduate education. For others, it may be the delay in starting a family, or the unwillingness to start a family on the poverty-level graduate student stipend. And for still others, it may be an unwillingness to invest another four to six years of study in a career path without a more certain payout. In case Mr. Wilkinson hasn’t noticed, starting jobs in these fields don’t pay all that well and older workers who have achieved higher pay levels are favorite targets in corporate downsizing.

If American cannot encourage enough students to train for the so-called well paid careers now, what chance would we have after the wage scale was forced down by a flood of foreign technical workers, at least some of who have been subsidized in their education by foreign governments? Importing new technical workers to the detriment of our own seems to be a path to a new government program – all students left behind! Perhaps if we import enough skilled foreigners, we won’t need to educate any more of our own, and then we can save money on taxes!

Or just maybe we could work on improving our educational system?

The problem with the politically-correct seeming position that we should share the wealth though H1B visas and outsourcing is that countries with unsustainable levels of population are creating a tide of humanity willing to work for wages that we in the developed world cannot ever compete with. If we destroy careers in engineering and computing in this country, it will not result in any improvement to the average net worth in countries like India, where the population still continues to increase precipitously.

Another gem from the Cato Institute, which exists only to further corporate profits at the expense of everything else - sustainability, morality, sense, etc. It seems that 'wage disparity' is a problem for the Institute when the people 'benefiting' are not those in the corner offices. And the solution? Certainly not to increase the wages of the lowest paid! Instead, make everyone poor! Not to go too far off topic, but the real problem with the P.C. position of the desirability of spreading the 'wealth' through H1B visas is population growth. Countries like India and China have increased their populations to levels that their environments can be sustain - and they are not slowing down. Those of us in the developed world cannot compete with the tide of humanity that results from unsustainable population growth. Outsourcing or insourcing is not likely to improve the average net worth of people in developing nations as their populations continue to increase - but it has the capacity to destroy the middle class here in the U.S.

I have a master's degree in computer science and an MBA on the accounting track, and I'm delivering pizzas. Maybe if I'd moved to India I would have a better chance at getting a job.

Pages

With Generous Support From...