Date: Mon, 28 Jun 2004 22:47:30 -0700 From: Norm Matloff To: Norm Matloff Subject: Computerworld on proposed legislation To: H-1B/L-1/offshoring e-newsletter Activist critics of the H-1B program who are relatively new to the issue might take heart from the comments by Undersecretary of Commerce Phil Bond in the article from Computerworld enclosed below. But such optimism would be unwarranted, as similar (indeed stronger) words were spoken by Secretary of Commerce Bill Daley back in January 1998--the year that Pres. Clinton did sign an H-1B increase into law. (See the second article enclosed below, in which Daley, speaking at an ITAA conference, said that the Clinton administration was opposed to an H-1B increase.) Bond is the one I criticized in a posting here the other day. Speaking at the ITAA conference, he endorsed the industry lobbyists' claim of an IT labor shortage, an absolutely amazing thing for him to say in light of the unemployment/underemployment he recognizes in the CW article below. (See my posting at http://heather.cs.ucdavis.edu/Archive/DOC2.txt) The CW article here says that Bond made those comments at "this week's conference." Apparently due to an editing error, the article does not say which conference it was, but presumably it was that ITAA conference. [Added later by NM: The print edition did indeed state it was the ITAA conference.] So, the ITAA seems to be following an established pattern, repeating in their strategy from 1998: They hold a national conference, at which they invite a top DOC official to speak, during which he denies that the administration supports an H-1B increase, thus giving (false) assurance to those who oppose such an increase. By the way, after I posted my criticism of Bond's remarks last week, a DOC researcher wrote to me, pointing out DOC's latest report on the IT labor issue, available at www.technology.gov/reports/ITWorkForce/ITWF2003.pdf The DOC person pointed out that the DOC did seek and receive input from IT workers (including John Miano of the Programmers Guild) in preparing that report. As I said last week, I have generally found the DOC to be genuinely interested in IT worker input, and after its disastrous first report in 1997, the succeeding ones have been good. That is what made Bond's remarks last week so disappointing. After taking a look at the new report's 80-point summary, I am even more disturbed by Bond's remarks. While I have numerous major objections to many things in the report, I do agree with its major theme. That theme is that if there is an IT labor problem at all, it is a "skills shortage" rather than a worker shortage. The report says more retraining for IT workers is needed to keep their skills up to date, etc. As many of you know, I disagree with that (I believe that most employers are using the skills issue as a pretext), but my point is that the report does NOT say we don't have enough IT workers. Yet last week Bond gave the standard ITAA party line--let's get more kids interested in math and science in order to remedy our alleged IT labor shortage. In other words, Bond chose to send the ITAA message, rather than the message of his own department's report. Norm http://www.computerworld.com/careertopics/careers/labor/story/0,10801,94116,00.html H-1B increase faces stiff resistance The jobless rate for computer scientists and systems analysts in the U.S. hit 6.7% in Q1 News Story by Patrick Thibodeau JUNE 25, 2004 (COMPUTERWORLD) - The political attack against offshoring isn't letting up. Bills that could affect offshore IT work have been introduced in 37 states, and efforts to increase the federal H-1B visa cap aren't making headway. Indeed, Phil Bond, undersecretary for technology at the U.S. Department of Commerce, this week said H-1B supporters will need to make a strong case for an increase, particularly in light of the record levels of unemployment that engineers are facing. "The need is going to have to be real," Bond said at this week's conference. In May, the Institute of Electrical and Electronics Engineers-USA said the jobless rate for computer scientists and systems analysts in the U.S. went from 5.4% in the fourth quarter of 2003 to an all-time high of 6.7% in this year's first quarter. The number of people employed in the field averaged 722,000 in 2003; the first-quarter figure this year was down to 672,000, the IEEE-USA said. This year's cap of 65,000 H-1B visas was reached in February, and companies have already begun submitting applications for the fiscal year that begins Oct. 1. High-tech companies are urging passage of a bill introduced by U.S. Rep. Lamar Smith (R-Texas) that could boost the cap by 20,000 visas by exempting U.S. university graduates with a master's degree or higher from the limits. "In this atmosphere, doing anything on immigration is difficult," said Lynn Shotwell, director of government relations at the Washington-based American Council on International Personnel, which backs Smith's bill. Shotwell said many companies planned ahead and were able to meet their H-1B needs for the current fiscal year. But, she added, "next year might be a different situation." Among the states, one bill that's gaining support is a California measure authored by state legislator Carol Liu, a Democrat from South Pasadena. The bill, AB 1829, would prohibit government agencies in the state from contracting with IT services firms that use foreign labor to fulfill contracts -- work would have to be performed exclusively in the U.S. That bill was recently approved by the state assembly and now is in the state senate. Such antioffshoring measures could have a big effect on state governments as their IT workforces age. For example, Connecticut CIO Rock Regan said that up to 35% of his state's IT workers will reach retirement age in the next five years. Many other states face similar problems, said Regan, a former head of the National Association of State CIOs. "I think it's going to force states to look at different alternatives," he said. "Whether that's offshore or not, I don't know if I can predict that." The California measure worries regulatory opponents. "California tends to be a bellwether on business regulatory issues," said Stuart Anderson, executive director of the recently formed National Foundation for American Policy in Arlington, Va. San Jose Mercury News CLINTON OPPOSES HIGHER VISA CAP HIGH-TECH NEEDS: FOCUS ON 'HOME-GROWN SKILLS,' COMMERCE CHIEF SAYS. January 13, 1998 The Clinton administration will not support an increase in the number of skilled immigrants permitted to work for the high-tech industry to help ease a worker shortage that business leaders say is reaching crisis proportions. Secretary of Commerce William Daley called an increase in the current cap on H-1B visas ''politically not feasible'' at a national convocation on the information-technology workforce shortage held Monday in Oakland.''We must focus on home-grown skills,'' Daley told the gathering of 300 industry leaders, educators and government officials, suggesting the solution will come in new partnerships between industry and education. ''In the new economy, businesses have to take on new responsibilities,'' Daley said. ''Talk to the schools as you would talk to your suppliers. Schools supply your most important raw material.'' The role of government will be chiefly to ''shine a spotlight on the opportunities that are there,'' Daley said. The conference, which was organized by the Information Technology Association of America, the U.S. Departments of Commerce and Education, andthe University of California-Berkeley, kicked off what business hopes will become a national dialogue on the need for more computer professionals. A bevy of government officials, including Education Secretary Richard Riley and Deputy Secretary of Labor Kathryn Higgins, joined Daley to voice concern about the problem but proposed no sweeping new initiatives. The nation has 346,000 vacancies for information-technology workers, according to a recent study conducted by ITAA with Virginia Tech University. Daley said the Commerce Department released a new estimate Monday that the U.S. economy will generate more than 100,000 information-technology jobs each year for the next decade, at the same time that U.S. universities are expected to turn out 24,000 information-technology graduates yearly. Daley said in an interview with the Mercury News that industry must concentrate on developing the human capital in the United States, perhaps by turning to segments of the workforce that traditionally have been overlooked by business, such as women, minorities and the disabled. ''Industry can't wait for government to come up with some solution,'' Daley said. ''Politically that's not going to happen, in my opinion.'' Silicon Valley business leaders, however, have said that increasing the cap on visas for skilled high-tech immigrants has become one of their top legislative priorities this year. Kate McGee, vice president of corporate affairs for Oracle, said industry would continue to lobby for such changes and called the commerce secretary's position ''unfortunate.'' Gale Fitzgerald, chief executive of CTG, an international information technology services firm, warned the gathering that the tech-worker shortage could cost the United States its leadership position in the technology field. Turnover rates in the industry range as high as 70 percent and salary increases are running 14 percent yearly as companies across the business spectrum compete for the small pool of available talent, Fitzgerald said. Graham Spanier, president of Pennsylvania State University and chairman of the Presidential Advisory Board on Information Technology, urged colleges and universities to step up their participation in public policy debates on information-technology issues. ''The boundaries between campus, workplace and home are changing, even eroding,'' Spanier said. ''We can no longer afford to sit on the sidelines.'' Higgins, deputy secretary of labor, announced two initiatives -- an $8 million electronic labor exchange that would coordinate an existing online job bank with an online talent bank, and a $3 million fund to support new projects to train unemployed workers in new skills for the information-technology industry. The Department of Labor and the Department of Education also are providing up to $6 million in grants for business that expand their involvement in school-to-work programs. Even without any proposals for broad new initiatives, however, the convocation was a useful first step for articulating a key industry issue, said Paul Cosgrove, chief executive of the Claremont Technology Group, Inc. and a member of the ITAA executive board. The convocation continues today with a luncheon address by Dr. Glenn Seaborg and case studies of partnerships between industry and schools.