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Companies need 'access to the very best', critics say H-1B reform will cost American jobs

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'There are no skilled workers unemployed,' says Sarvesh Dharayan. He says without more H-1B visas, he'll have trouble finding the kind of high-skill workers he needs.
'There are no skilled workers unemployed,' says Sarvesh Dharayan. He says without more H-1B visas, he'll have trouble finding the kind of high-skill workers he needs. - (AARON HOUSTON)

If you run a business in the life sciences, technology, engineering or chemical sectors, like Sarvesh Dharayan does, the national debate over immigration isn't a matter of border security or a path to citizenship.

Rather, the key point is access to highly skilled foreign workers, and pathways such as the H-1B visa program, which supplies companies like Dharayan's Apex Technology Group with the workers he can't find stateside.

Those workers often are educated at New Jersey's universities, but are forced to bring those skills back to their home countries, because programs like H-1B have aggressive annual caps, which in some years are met within a week of the application window opening. Immigration reform, however, could help change that.

Katherine Kish, executive director of the nonprofit Einstein's Alley that promotes Central Jersey's tech corridor, said immigration plays a key role when innovative companies look for highly trained workers.

Hundreds, if not thousands, of foreigners are trained here in high-demand fields, "and we don't want them to go home," Kish said. "We want them to stay here and we want them to be employed here in Einstein's Alley."

Kish has a sympathetic ear at Apex, which specializes in providing information technology services to corporate clients. Dharayan, its president, said he can't supply IT help without a steady supply of skilled workers.

"The economy is growing, we have high demand — and there's no visas available," he said.

INCREASING THE CAP

Legislation passed by the U.S. Senate in June would increase the cap on both H-1B visas and green cards issued to highly skilled workers. Matthew Kolodziej, a legislative fellow at the Washington, D.C.-based Immigration Policy Center, said it also would shift the emphasis toward green cards, rather than temporary visas.

Green cards also are subject to caps, though exceptions can be made for people deemed to have extraordinary abilities, or for international managers and executives at international companies.

The lack of visas is already manifesting itself for Xinyu Feng, a 21-year-old junior studying quantitative finance at Stevens Institute of Technology, in Hoboken. Her dream job is to work on Wall Street, but when she has gone to career fairs, "several companies told me they are only hiring U.S. citizens" for internships, she said.

The reason, she said, is companies are reluctant to invest in training international students if the H1-B visa shortage means the intern might not be able to stay on with the company after graduation. Without a job, she won't be able to remain in the United States after she graduates.

"I would love to see the (U.S.) government do something to make the (visa) process easier, for the students and for the employers," Feng said.

Tuition and fees at Stevens run more than $40,000 a year, and while Feng said she has received several thousand dollars in scholarships, most of the expense is being paid by her family and student loans. She said Stevens helps international students get established here, through résumé development and establishing connections, "but no one can guarantee us a job — we have to win a job ourselves."

DISPLACING WORKERS

It's not that simple, though.

Mary Giovagnoli, the Immigration Policy Center's director, said there are concerns about displacing American workers.

"It really kind of boils down to how do you create a system that accesses what is needed … and how do you balance that against the need for not only ensuring American jobs but ensuring the (foreign) workers are not being exploited?" she said.

To that end, the Senate legislation comes with stronger requirements to ensure U.S. companies seek to hire American employees first. It also sets a prevailing wage rule to limit exploitation of workers from overseas.

In some cases, Giovagnoli said, the prevailing wage requirement for an H-1B visa could mean the foreign workers are paid higher than the market rate, "an incentive to hire American workers," she said.

Preventing foreign workers from displacing Americans is particularly sensitive in a place like New Jersey, where the jobless rate remains above the national average. But Dharayan said the problem is most of those unemployed workers don't have the right skills to fill the positions.

"There are no skilled workers unemployed," he said.

Debbie Hart, president of BioNJ, the trade group that represents the biotechnology industry, said her industry is growing, often by hiring displaced pharma workers. But she said even with the relatively high unemployment rate, biotechs here still say finding talent is their top concern, alongside finding funding.

"Companies need access to the very best talent pool, and some of that will come from those who are currently unemployed in New Jersey and some of that will come from overseas folks," she said.

ENTREPRENEURIAL MINDSET

Kish said another issue involves foreign nationals who want to start their own companies.

"A great number of skilled immigrants, especially in STEM fields, are entrepreneurs," she said of those who study science, technology, engineering and math. "And they start companies and they hire Americans."

A 2006 study by the National Venture Capital Association found one-quarter of the venture-backed public companies launched in the 15 years prior had been started by immigrants.

Kolodziej said one provision of the Senate legislation would allow investors to sponsor visas. But he said it's unclear if such a system is workable because would-be entrepreneurs might have difficulty getting to the point where they can seek investors without some kind of visa or immigration document.

Though the Senate bill gives some idea of what immigration reform might look like, the Republican leadership of the House of Representatives has expressed plans to craft its own legislation, thus its unclear what any final law would look like.

Giovagnoli said she's optimistic that reforms for highly skilled workers will be a part of comprehensive immigration reform, if it passes.

Kish said she'd like to see more foreign workers join the American economy, because she said innovation-fueled industries could see a tremendous upside.

"I personally feel that the American economy at the high end — the research end — is eminently expandable," she said.

The alternative, of course, is to lose graduates when their studies are completed. Xinyu Feng, the Stevens student, said it's much easier to find a job in her home country.

"I have friends who have already graduated, and some of them went back to China because they can't find jobs here," Feng said. Some enrolled in graduate school "so that they have another year to look for a job."

For those who head home, "it is relatively easy to find a job" in China, she said: After her freshman year at Stevens, she went home China for a summer internship with a small hedge fund in Qingdao.

"But I would love to stay here," she said. "I love America, and I have a lot of friends here."

E-mail to: editorial@njbiz.com
Contributing: Beth Fitzgerald

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