- The Washington Times - Sunday, August 26, 2012

The debate on the pros and cons of off-shoring jobs mirrors a long-standing debate within the tech industry about the need to recruit foreign workers to fill jobs in the U.S.

Tech firms complain frequently that they cannot find qualified American workers because of a shortage of American students with college degrees in math and science. A Brookings Institution study last month found that more than half of all engineering bachelor’s degrees in the world are now earned in Asia, with only 4 percent awarded in the U.S.

Because of the skills shortage here and plentiful supply of engineers in Asia, Congress enacted a special visa program in 1990 that enabled U.S. companies to temporarily hire foreign workers and renew their visas every three years if they couldn’t find American replacements.

The number of so-called “H-1B visas” is capped each year at 85,000, and all the slots typically are filled within a few weeks of opening. Big technology companies such as IBM Corp., Microsoft Corp., Intel Corp., Oracle Corp., Google Inc. and Qualcomm Inc. are among the biggest users of the program.

Vivek Wadhwa, a Stanford University fellow, said the nation urgently needs to change its visa policies so that talented foreign students who come to study at U.S. universities not only are allowed to stay under the temporary visa program but are encouraged to make their careers here rather than returning to their home countries. Foreign entrepreneurs create a disproportionate share of the tech jobs that open up each year, he said.

“Fifty-two percent of all Silicon Valley startups are founded by immigrants,” he said. “We’re exporting our prosperity. We need all the skills we can get, immigrant or native.”

Web-based companies are among the many tech companies lobbying for more foreign workers to fill jobs that they say go begging.

“We need more of these math and science workers,” said Jonathan Johnson, president of Overstock.com. “It’s not a question of if, it’s a question of where they’re going to create those jobs. If we don’t give them visas to create the jobs here, they’ll go home and create the jobs that will compete against American workers.”

But critics say IBM and other tech companies don’t have to go overseas to find good workers.

“With hundreds of thousands of laid-off [information technology] workers in the USA, why can’t American workers be hired for these positions?” asked Robert Cringely, an IT blogger who wrote a series of columns on the bloodletting at IBM earlier this year that eliminated nearly 2,000 jobs.

“IBM doesn’t want US employees,” he wrote. “IBM’s goal appears to be to have as few employees in the US as possible, maximizing profit. But doing so clearly hurts customer satisfaction. Major IBM customers such as Amgen, The State of Texas, and most recently the Walt Disney Company have cut ties with IBM in favor of other providers.”

Mr. Cringely said tech clients “are starting to realize that they can directly hire off-shore companies such as TCS, Wipro, HCL and Satayam, and book the savings directly instead of paying IBM top dollar for support and then seeing that support fulfilled” from countries such as China, India, Brazil and Russia.

While IBM is in the spotlight right now, “This is not just about IBM. It is about the culture of large corporations today,” Mr. Cringely wrote.

“There are huge economic forces at work here,” he added. “Right now, for example, there are hundreds of thousands of experienced IT workers in the USA who are unemployed at the exact moment when big corporate America is screaming for relaxed immigration rules to deal with a critical shortage of IT talent. How can this be?”

The answer is simpler than it seems, he said.

“In America right now, there is a glut of $80,000-and-above IT workers and a shortage of $40,000-and-below IT workers,” Mr. Cringely wrote. Moreover, the higher-paid workers expect good benefits, including health insurance and pensions, that increase in cost with the increasing age of the worker.

He noted that “older workers are more expensive than younger workers,” adding that “it is generational warfare” disguised as cost-cutting.

Longtime workers often are outraged when they see corporations cut back on their benefits and turn their backs on promises made years ago, when the U.S. was the undisputed center of the technological universe, not realizing that those lucrative perks are what makes them vulnerable to layoffs and forced retirement, Mr. Cringely said.

“We have a cadre of IT workers who have been slowly boiled like frogs put into a cold pot. By the time they realize what’s happened, these people are cooked,” he wrote. “They just want things to go back the way they were but this will never happen. Never.”

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