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High skill, low priority

July 24, 2006

ONE OF THE UNITED STATES' greatest economic assets is its ability to attract and stimulate the world's most innovative minds. High-skilled immigrants have long played a key role in the country's technological prowess. But that magnetism is being threatened by inadequate visa policies and this year's volatile immigration debate.

The H-1B visa, good for six years, is the main legal means for employers to bring skilled and specialized workers from abroad. College grads make up 98% of H-1B recipients; 48% hold advanced degrees; and a large portion work in technological R&D. They supplement a native-born workforce that earns an inadequate number of science degrees (one-third of all doctorates in science and engineering awarded in the U.S. go to foreign-born students).

At the height of the dot-com boom, Congress raised the cap for H-1Bs to 195,000 per year, though that quota was never reached. Since then, the cap has fallen to 65,000. Next year's limit was filled within the first two months of eligibility, far earlier than ever before. Because the 2006 fiscal year begins in October, that leaves a gaping 16-month hole during which no business can hire skilled foreigners.

This policy discourages talented international students from staying in the U.S. after graduation. Besides the 65,000 H-1Bs, those with recent advanced degrees from U.S. institutions can compete for an additional 20,000 visas. That's only a tiny percentage welcomed from one of the most dynamic segments of society. And those who apply typically have to leave the country one year after graduating, because that often comes before the next H-1B batch is doled out.

H-1B opponents argue that the visas are abused by the tech sector to suppress labor costs, thereby displacing American jobs. But both Silicon Valley and the Southern California aerospace industry complain of labor shortages, while a national unemployment rate persistently under 5% suggests the economy needs all the brains it can get. Today's H-1B engineer is tomorrow's green-card-holding entrepreneur, creating jobs that might otherwise be shipped overseas. And though enforcement is less than perfect, H-1Bs do mandate that immigrants receive the same wage as qualified Americans.

The Senate has been considering a bill, both as part of comprehensive immigration reform and separately, that would increase the H-1B quota to 115,000, extend the grace period at the end of a student visa from one year to two and more than double the annual quota for high-skilled green cards (permanent residency for workers and their families) from 140,000 to 290,000. This would drastically reduce the multiyear bottleneck facing many desirable immigrants.

Congress should decouple this sensible bill from the looming train wreck of immigration reform. The next generation of tech innovation could depend on it.

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