Labor shortage Band-Aid
For the past decade a low drone of unease has been resonating from executive
boardrooms, where the dire need to fill IT jobs has reached crisis proportions. And the
problem isn't expected to go away anytime soon. With 850,000 unfilled IT positions
expected in the next 12 months, computer companies have been urging the United States
Congress to address the problem by increasing the number of H-1B temporary work visas.
But importing temporary technology talent from other countries is not necessarily the
The Immigration and Naturalization Service has doled out 115,000 H-1B visas this year,
the same figure as last year. That number was up from 65,000 in 1998. This year's
allotment was already filled by March; in 1999, the cap was hit by mid-June. Several
different legislative efforts are under way to curtail the labor shortage by relaxing
The American Competitiveness in the Twenty-First Century Act, recently approved by the
Senate Judiciary Committee, was supported by both Democrats and Republicans. This bill
aims to increase the cap on H-1B visas to 195,000 for each of the next three years. But
industry insiders say the visas are only a Band-Aid solution for what's clearly a
A study by the Information Technology Association of America, a trade association based
in Arlington, Va., reports that 1.6 million new IT jobs will open over the next 12
months, and half of these positions are likely to go unfilled. The labor crunch is
growing in the United States. Raising the number of H-1B visas will not solve the
problem or eliminate the crisis, say several analysts.
The visa program was first introduced in 1990 with the goal of bringing in foreign
workers to temporarily fill jobs for which there were no American candidates. As a
result of the technology boom of the 1990's, this temporary need mushroomed into what
appears to be a never-ending demand for skilled workers.
More specifically, H-1B visas allow foreign workers with college degrees to live and
work in the United States for up to six years. The cost for companies is not cheap:
application fees are $1,000 per candidate, plus legal fees, which can drive the total
expense to about $5,000. The application process is also an obstacle, taking up to
three months to complete. And if the H-1B candidate is not granted a green card at the
end of the six-year visa term, the company is back to square one.
For Marc Armstrong, director of recruiting at Pervado Systems, a product ownership
services start-up, the capping of H-1B visas is a positive. It means that the process
time for transferring the holder of a H-1B visa from another company is cut from three
months down to six weeks. "The 'application' process for transfers gets cut down,
roughly in half," says Armstrong.
The situation is not so easy for workers holding H-1B, visas and some are frustrated by
what they say is a flawed system. In a market where an employee's salary increases by
job-hopping, workers tied to an employer are at a disadvantage. For six years, H-1B
visa holders can be tied to the same company, doing the same jobs, limiting their
opportunity for growth. If they do leave an employer for career advancement, their
immigration process has to be started from the beginning again. And if they become
unemployed, the time allotted to find a new position is not enough -- they have only 10
Many notable luminaries in the high-tech community are making their concerns about this
shortage heard on Capitol Hill. Linus Torvalds, inventor of the Linux operating system,
Steve Wozniak, an educator and one of the cofounders of Apple Computer, and Esther
Dyson, president of EDventure Holdings, are among dozens of dot-com leaders pressing
Congress to issue green cards, not just temporary working visas, to foreign workers.
Opponents, however, contend that any attempt to bring in foreign workers is misguided.
They claim that more work should be done to hire and train potential employees already
in the US, such as older workers and people with disabilities.
The political dueling continues as the labor demands of the new economy grow. What
remains constant is the need for skilled IT workers; the uncertainty is in how the
labor shortage will be resolved.