Enlarging--and Enriching--the U.S. Labor Pool: Page 2

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But let's face it, people can make statistics walk, talk, jump, and cluck like a chicken. In the case of the IT worker shortage, anecdotal evidence may be the most powerful persuader of all. What do IT managers universally acclaim as their number-one problem? What topic comes up first at industry confabs and conventions? What is seen by venture capitalists and entrepreneurs as a serious limit on the growth of startups? What problem do you face every morning when you set out to assign bodies to various projects?

Nevertheless, there are those who say the IT worker shortage, while not exactly fabricated, is exaggerated and exacerbated by industry mouthpieces who are unwilling to put needed resources into more creative training and hiring, notably, the hiring of older IT workers.

"What we see is a major pickiness by high-tech employers," says Jack Martin, special projects director at the Federation for American Immigration Reform (FAIR), a Washington, D.C.-based nonprofit organization that seeks to tighten immigration laws and policies. "At the same time, there are significant indications that significant numbers of older high-tech workers are not being hired."

FAIR believes corporations avoid hiring older U.S. citizens because they tend to demand higher pay. The organization advocates ending this practice to address the IT worker shortage.

Help Wanted

Fair or not, one thing's for sure: IT managers are clamoring for help. Telman's Ozar says his company "has found people over there [in England] who'd love to be over here," but has twice been stymied when the year's H-1B quota--which is filled on a first-come, first-served basis--was reached while the company was negotiating the bureaucratic maze. As a result, the company currently doesn't have any H-1B employees on staff.

With few other options, the result for Ozar has been a project manager's nightmare. "We've started using telecommuting contractors from other states," he says. "They have full-time jobs but are willing to pick up a few hours at night and on weekends." Ozar would not comment on the cost of this solution.

Offshore outsourcing is the practice of hiring companies outside the United States to do IT work such as code writing. Because of its relatively small size (the IT department is staffed by 15 full-time people) and because much of its development work revolves around business rules (the quantities corporations plug into their programs that vary greatly from company to company) Telman has ruled out offshore outsourcing. But many businesses do respond to the lack of qualified U.S. workers by sending development work overseas. In this scenario, U.S. firms usually contract with companies in countries such as India. This solution is stressed by those seeking an increase in the H-1B cap. Susan Williams Defife, CEO of McLean, VA-based Web site womenCONNECT.com, recently testified before the U.S. Senate that if the H-1B cap is not raised, moving operations offshore will be one of her company's few options.
"Experts expect President Clinton to sign the bill, which spent months hung up in a congressional game of pat-a-cake, as various politicians attached unrelated and semirelated measures such as illegal-immigrant forgiveness measures."

It's a vital point, advocates say, because one of H-1B critics' major arguments is that the visas supply jobs for foreign nationals at the expense of U.S. citizens. Proponents of a higher cap counter with two points. First, they ask, which is preferable: using foreign nationals with visas to contribute to the U.S. economy on these shores or sending high-tech work overseas? Second, they argue that H-1B workers create satellite jobs. T. J. Rodgers, CEO of San Jose, CA-based Cypress Semiconductor Corp., in 1998 told Congress that for every H-1B employee, Cypress hires five U.S. workers in such areas as marketing, documentation, and sales.

A March 2000 report called "The H-1B Straitjacket" from the libertarian-leaning Cato Institute, headquartered in Washington, D.C., calls H-1B workers "an important source of flexibility in the labor market." The report says U.S. employers need the agility afforded by H-1B workers; this flexibility allows businesses to respond quickly to market demands.

Is It Cheaper?

Some say H-1B visas are used to hire cheap help, end running the expense of retraining experienced programmers. This experience tends to come with age, which means their salary and benefits plans are relatively steep for employers. Kazim Isfahani, a senior industry analyst at the Boston-based Giga Information Group, says the H-1B program "has become a way to keep costs down."

While foreigners hired under the program are supposed to be paid market rates, regulations allow for 5% worth of wiggle room. If, for example, the market rate is determined to be $60,000 a year for a given job, you can pay an H-1B worker $57,000. Companies do take advantage of this option. More important, critics charge that H-1B workers, who are desperate to stay in the United States and eager to apply for permanent-immigration status once their six-year H-1B status expires, may be cowed into settling for rock-bottom wages and substandard living conditions. More than half of the temporary workers in the United States seek permanent immigration status.

Code-jockey sweatshops? Indentured servants? Really? Isfahani says, "It's not rampant, but it does happen." He says this abuse is possible because visa holders from some nations, such as Pakistan, perhaps, or some Southeast Asian countries, are accustomed to such a low living standard that to them, an overcrowded apartment and long hours in the U.S. may seem like a pretty good deal.

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