How Bad Are Our Immigration Policies Hurting Innovation?

Recently, yet another bill was introduced in Congress trying to ensure that more highly skilled and educated foreign workers are allowed into the country each year.

The bill, by Sen. John Cornyn, the senior Republican on a panel that oversees immigration issues, is sure to be one of many that promises to look at the issue of how U.S. policy impacts the ebb and flow of high-tech jobs in the nation.

The proposed legislation comes on the heels of several comments at the Innovation Summit that the future of business creativity in the United States depends on getting the best minds together, regardless of nationality.

Many people today "see the world as our community," said Peter Agre, a Nobel laureate and former president of the American Association for the Advancement of Science.

It is a "core value of the United States to let in talent," said Arun Majumdar, the first director of the Advanced Research Projects Agency-Energy (ARPA-E) and, along with Agre, one of the summit's closing keynote speakers.

An engineer with a doctorate from the University of California-Berkley, Majumdar was associate laboratory director for energy and environment at California's Lawrence Berkley National Laboratory when he was appointed three years ago to head up the newly funded ARPA-E.

He also was born in India. Nodding at his Nobel-winning colleague, Majumdar noted that one-third of all U.S. Nobel laureates were born somewhere else.

Earlier in the afternoon, Michael Jones, chief technology advocate for Google Inc., called for the federal government to increase the number of visas for specialized workers from overseas. "Don't send away the brightest people," Jones said.

Cornyn's proposed legislation focuses on increasing the number of foreign workers in STEM fields -- science, technology, engineering and mathematics -- by creating a new green card system and reducing a lottery visa program.*

However, much of the debate on highly skilled foreign workers over the years has centered on whether to just expand the number of H-1B visas.

Created in the 1990s, the H-1B is a category of visa specifically for workers needed in specialty occupations, as well as those needed for certain Defense Department research and development jobs, and fashion models "of distinguished merit and ability."

For the most part, those workers must have at least a bachelor's degree or above, or equal training and experience. Currently, the law caps the number of petitions for the visas to 65,000 a year, although some exemptions exist. In general, the visas are good for three years and may be extended for another three.

While some say the H-1B cap is not high enough, others are worry about how the visas impact U.S. workers.

The General Accounting Office, which as the investigative arm of Congress has delved into the H-1B issue at various times over the years, put out a new report last year suggesting some reforms.

Among other things, the GAO found in its latest investigation that approved H-1B workers were "generally younger and more educated as compared to their U.S. citizen counterparts in similar occupations." And, that "the demand for new H-1B workers is largely driven by a small number of employers." It found that fewer than 1 percent of employers overall account for one-quarter of all H-1B approvals.

After interviewing 34 H-1B employers, the GAO found the cap did create additional costs, although the impact of those costs depended on how large and established the company already was. 

For instance, in years when H-1B visas were denied because of the caps, the larger companies said they found other ways - and "sometimes more costly" - to hire the worker they wanted. Smaller firms, however, were more likely to go with different candidates, resulting in loss of time and money, a concern "particularly for firms in rapidly changing technology fields."

The GAO suggested some reforms after finding that some elements of the H-1B program that served to protect U.S. workers, such as "requirements to pay prevailing wages, the visa's temporary status and the cap itself," were weakened, mostly by fragmented responsibility for oversight and the lack of a legal provision for enforcement.

Google, which with between 200 and 300 H-1B workers, has been in the top 100 of employers with the most H-1B workers, has called for expanding the cap for years. While saying that nine out of 10 U.S.-based Google employees are citizens or permanent residents, the company also has pointed out that former H-1B visa holders invented some of its most popular tools, including Google News.

The latest H-1B application season began April 1 and, while in previous years the cap on was reached within days, this year only 17,400 petitions were received within the first week. Last year, it took until November before the cap was met.

As for those foreign fashion models taking U.S. jobs, don't be too concerned. While 259 were allowed H-1B visas in fiscal 2009, only 250 were approved for fiscal 2010.

*This paragraph has been updated to clarify the effect of Sen. Cornyn's bill on the H-1B visa program. We regret the previous error. 

AJ Plunkett - AJ Plunkett is a veteran reporter and editor based in Virginia with more than 27 years of experience. As a reporter, she's gone from covering the oil industry and Navy in South Texas, to military and defense industries of Hampton Roads, to the budget battles fought in the halls of the Pentagon and Congress. She has followed stories to Saudi Arabia and Somalia, as well as across the United States.