Two Charts Which Show How America's Dysfunctional Visa System Is Harming The Economy

Hamilton Place Strategies has issued a report explaining the economic impact of increased visas for highly skilled foreign workers.

The verdict? Not only do these highly qualified foreign worker do no harm to American jobs, they actually create more of them and enable Americans to go into the workforce. Not raising the cap is holding the economy back.

For example, tech companies — one of the brightest sectors of the U.S. economy — are currently hamstrung by low visa caps:

Innovative tech companies such as Microsoft (4,109 requests in 2010), Intel (1,510),IBM (1,468), and Google (1,009) are most harmed by the cap. In fact, almost half of H-1B requests come from computer occupations. Looking through the number of requests across more than 20 fields, Ruiz, Wilson, and Choudhury concluded that there is “significant continued demand for high-skilled foreign workers with employer requests annually outpacing available slots.”

The caps have caused major problems for employers looking to make financially sensible hiring decisions. 

Even more, this hurts Americans by denying them jobs that would have been created had the foreign born innovators been allowed into the country:

Bill Gates testified before Congress that for every immigrant hire at Microsoft, an average of four non-immigrant employees are hired as a result of the innovations by high-skilled immigrants. […] A 2011 study by the Partnership for a New American Economy found that first generation immigrants and their children had a founding role in 40 per cent of Fortune 500 companies. 

This chart — explained further in this article — shows the ever-decreasing window that major U.S. corporations have to hit when trying to recruit highly qualified foreign workers:

Photo: Walter Hickey/BI, data from

Note that in 2008 and 2009 it took less than a week for the visas to run out. While the recession expanded the window, the recovery has become so robust that in 2013 the U.S. ran out of H-1B visas for high skill workers in a mere two and a half months. 

The issue is that even though America is producing more college graduates than ever, the number of STEM graduates has remained unchanged. The U.S. graduated fewer engineers in 2010 than in 1986, and only marginally more graduates majored in maths, statistics, and computer and information science. 

New college graduates are overwhelmingly majoring in the liberal arts, and the H-1B visa compensates for the dearth of maths and science college graduates needed to drive the tech industry:

college graduate majors STEM

Photo: Hamilton Place Strategies


The point is visa caps are hurting the U.S. economy: 

The evidence is clear: from high-skilled to low-skilled, visa caps and issuances miss an economic opportunity for the U.S. Moreover, current policy lacks institutionalized provisions that ensure our immigration system can keep up with the changing nature of the U.S. economy. In order to capitalise upon the economic benefits of immigrants and to address the needs and dynamic nature of our economy, we must increase the amount of visas issued across the board and institutionalize mechanisms to ensure immigration levels support a growing U.S. economy.

Read the full article here >

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