Date: Mon, 10 Apr 2006 22:33:53 -0700 From: Norm Matloff To: Norm Matloff Subject: IEEE-USA hastening the demise of the American engineer To: H-1B/L-1/offshoring e-newsletter Historically IEEE-USA is to be commended for being one of the first major professional organizations to point to the severe problems in the H-1B program. Some of its work in this regard has been quite masterful, for example their 1998 database, The Misfortune 500, a compendium of profiles of 500 engineers who could not get engineering work during the dot-com boom. IEEE-USA did a super job then. Ah, those were the days... But sadly, big changes came in 2000. IEEE-USA came under heavy pressure from the IEEE parent organization, which is dominated by industry and academia and thus is highly pro-H-1B. So IEEE-USA suddenly changed its stance. It still was critical of the H-1B program, but it started extolling "instant green cards" for foreign workers instead of H-1B visas. It ignored member complaints that the green card idea would be just as harmful to IEEE-USA members as H-1B. The Misfortune 500 Web page was taken down. There are individuals in the IEEE-USA leadership whom I highly respect, and I can certainly sympathize with the organization's plight. After all, the parent organization threatened to take away their funding. These guys play hardball. Nevertheless, I cannot understand how IEEE-USA could in good conscience endorse the proposed new F-4 visa category in the immigration bill now in the Senate. The bill would give automatic green cards to any foreign national who earns a Master's or PhD in the tech area from a U.S. university, after working in the U.S. for three years. F-4 would have just as bad an impact on American programmers and engineers as H-1B, and in fact in some senses would be worse. (Note that in addition to establishing the F-4 visa, the bill would also greatly expand the H-1B program.) Recall that employers hire H-1Bs to save on labor costs, with the savings coming in two forms: Type I savings stem from paying H-1Bs less than comparable Americans, while Type II savings come when employers hire younger (thus cheaper) H-1Bs instead of older (thus more expensive) Americans. Let's look at the impact F-4 would have. Since almost all the foreign graduates are young, F-4 would greatly expand the labor pool in the under-30 age bracket, and would thus give employers far more opportunities for Type II savings. In other words, F-4 would give employers far more opportunities to hire young people, with older engineers being the losers. It would amount to government-sponsored age discrimination. For this to be endorsed by IEEE-USA, whose old Misfortune 500 Web site consisted mainly of engineers in their 40s, is unconscionable. So, F-4 would be a disaster for older (over age 35) American engineers. What about the young Americans? Recall that the attraction of H-1Bs to employers is that the H-1Bs are de facto indentured servants, effectively immobile while their green cards are pending. Well, the situation for F-4s during those three years would be pretty much the same. The F-4s, putting top priority on staying employed during that crucial three-year period, would be highly risk averse. They would be reluctant to switch employers, for instance, for fear that the job at the new employer may not be stable. They would accept lower salaries in hope that their employers would be more likely to retain them during layoffs and less likely to offshore their job. They wouldn't make waves. For all these reasons and more, they would be just as attractive to employers as H-1Bs. Many employers would prefer hiring newly graduated F-4s instead of newly graduated Americans. So, young Americans would lose too. And clearly, the major swelling of the labor pool at the entry level would be bad news for the new American graduates. Things are already poor for this group. As will mentioned below, salaries and job opportunities for new graduates have been flat for the last few years. An interesting example was related to me recently by Ms. X, a U.S. citizen who is finishing her Master's degree this June. A couple of months ago she was offered a position as a software engineer. However, she opted for the "safer" route of a customer support job with another firm. Well, a short time later she learned that the entire software development department she would have worked in was being offshored! There would be no cap on the yearly number of F-4 visas issued, and no cap on the number of green cards given to F-4s. IEEE-USA endorses this too! (See the enclosed letter to Sen. Specter, and the phrase "... and exempting advanced degrees professional from the cap are even more important.") The F-4 visa would create its own demand, and with no cap on it, the consequences look very grim indeed. Contrast IEEE-USA's hearty endorsement of F-4 with the realistic statement by the Dept. of Professional Employees of the AFL-CIO: * Finally, we feel compelled to briefly address changes proposed in the * student visa program. Student visas were originally intended to allow * foreign students to come to the U.S for one purpose-education. Changes * proposed by the bill would put tens of thousands of foreign students in * direct competition with our own undergraduate and graduate students for * full and part time job opportunities. For our own, many U.S. students * need those jobs to pay their way through school, to help pay off * thousands of dollars in education loans and in many situations to gain * the skills and experience necessary for a successful career. The * challenges confronting them should not be made more onerous because of * changes in the student visa program...Simply stated, their job * opportunities will be limited both before and after graduation and their * wage prospects diminished by foreign workers who, studies have shown, * are paid far less than the prevailing rate. A few days ago IEEE-USA President Ralph Wyndrum created quite a stir among activists when he was quoted in a Datamation article as follows: * Ralph Wyndrum, president of the IEEE-USA, a non-profit organization that * describes itself as promoting the advancement of technology, says many * out-of-work IT professionals have themselves to blame -- not foreign * workers. Wyndrum was said to believe that engineers are laid off simply because they don't have up-to-date skills. ("Who Would the H-1B Visa Cap Increase Help?", Sharon Gaudin, Datamation, April 7, 2006, http://itmanagement.earthweb.com/article.php/3597521) An uproar ensued, with people replying that that had been in a continuous process of upgrading their skills throughout their careers. They had been laid off not because of out-of-date skills but simply because employers shun older engineers (they are too expensive, etc.). Wyndrum replied that he had been quoted out of context, and pointed to the the new Innovation Institute established by IEEE-USA. The Institute, according to Wyndrum, ("IEEE-USA Starts Training Institute for U.S. Workers," Patrick Thibodeau, Computerworld, March 29, 2006, www.computerworld.com/careertopics/careers/story/0,10801,109701,00.html), "is part of IEEE-USA's larger effort to help engineers maintain relevant skills and minimize the risk of losing their jobs to offshore workers." That sounds great--until one sees IEEE's intended audience: "The ideal student, said Wyndrum, would be a young advanced-degree holder who is already considered to be among the most prolific of a company's product developers and patent holders." Notice the word "young"! Whose side is IEEE-USA on? Given Wyndrum's background--he's a former AT&T executive--the answer seems clear. The industry says it needs F-4 because there is a shortage of American engineers with graduate degrees. Yet starting salaries at the graduate level have been flat for the last six years (see http://heather.cs. ucdavis.edu/Archive/StartingSalaryErosionMS.txt). And incredibly, the Senate bill would give F-4s A FULL YEAR to find a job! What kind of "shortage" is that, if it takes a year to find a job? In other words, the people who drafted this bill know full well that there is no shortage. Now IEEE-USA is organizing a "DC Fly-In" for its members. I'm enclosing the announcement below. Sounds pretty good at first: * IEEE-USA is offering all American IEEE members a chance to change the * debate in Washington. On May 2 and 3, we will be holding our * third-annual Career Fly-In. This event will give all American IEEE * members a chance to meet their Members of Congress and staff * face-to-face to discuss H-1B visas and other policies affecting the * engineering profession. * * IEEE-USA will arrange your meetings for you and will fully prepare you * in advance. All you need to do is come to Washington for the best * possible opportunity to influence Congress as it debates the future of * your profession. Yet by coming in under the auspices of IEEE-USA, participants will be unwittingly supporting IEEE-USA's endorsement of F-4. Some who understand this may make disclaimers to the contrary, but since most of them won't even know about F-4, the message to Congress will be that the participants back IEEE-USA's endorsement of F-4. I certainly would encourage people to participate, but they ought to be aware of the F-4 situation. I've been critical of IEEE-USA on occasion in the past, but that doesn't make it any easier for me to write this, as I know it will offend some people. (Though it is my understanding that some IEEE-USA leaders oppose the organization's endorsement of F-4.) But the organization's actions here are just plain wrong, and very naive if not hypocritical. The Specter letter and the "fly-in" announcement are enclosed below. Norm This is the html version of the file http://www.ieeeusa.org/policy/POLICY/2006/031506b.pdf. The Institute of Electrical and Electronics Engineers, Inc. - United States of America 1828 L Street, N.W., Suite 1202, Washington, D.C. 20036-5104 USA Office: +1 202 785 0017 Fax: +1 202 785 0835 E-mail: ieeeusa@ieee.org Web: http://www.ieeeusa.org [The same letter was sent to all Members of the Senate Judiciary Committee.] 15 March 2006 The Honorable Arlen Specter Chair, Committee on the Judiciary 711 Hart Building United States Senate Washington, DC 20510 Re: Comprehensive Immigration Reform Act Provisions Dear Senator Specter: As a long-time proponent of balanced reforms in America's legal immigration system, IEEE-USA is very encouraged by the inclusion of substantive improvements in temporary student and permanent, employment- based admissions programs in the draft Comprehensive Immigration Reform Act currently being considered by the Senate Judiciary Committee. We support Title IV proposals to extend the allowable duration of Optional Practical Training for F-1 foreign students from 12 to 24 months and to establish a new F-4 visa program for foreign nationals pursuing advanced degrees in science, technology, engineering, mathematics and related fields at American colleges and universities. Draft bill provisions that would expand employment-based immigrant admissions programs by raising numerical limits on permanent admissions (from 140,000 to 290,000); excluding immediate family members from the limit; recapturing unused immigrant visas from prior years and exempting advanced degrees professional from the cap are even more important. Taken together, these new student admissions and employment-based immigrant visa provisions will make it much easier for aspiring advanced degree professionals to study and work temporarily in the United States and, if they choose to do so, to adjust to legal permanent resident status on a fast-track to full-fledged U.S. citizenship. In view of the substantial increases in permanent employment-based admissions that will result from the above changes, and absent the inclusion of any reforms needed to fix the badly-broken H-1B temporary work visa program, IEEE-USA strongly opposes Title IV provisions calling for an immediate increase in the numerical H-1B cap from 65,000 to 115,000, an automatic escalator mechanism in future years and an unlimited exemption for foreign nationals with advanced degrees in STEM fields from U.S schools. Having established an unlimited exemption for advanced degree professionals in immigrant admissions programs, we see no need to do so in the non-immigrant H-1B program. The attached list of critical studies and reports from key Federal agencies including the General Accountability Office, Inspectors General at the Departments of Labor and Homeland Security and the White House Office of Management and Budget points to significant weaknesses in the H-1B program that must be corrected in order to ensure that U.S workers are not adversely affected and H-1B workers are not exploited. As the Administration concluded last year, the program has major flaws that leave it vulnerable to fraud and abuse that should be fixed statutorily. IEEE-USA advances the public good and promotes the careers and public policy interests of more than 220,000 engineers, scientists and allied professionals who are U.S. members of the IEEE. IEEE-USA is part of the IEEE, the world's largest technical professional society with 360,000 members in 150 countries. For more information, please contact Vin O'Neill at (202) 530-8327 and/or go to http://www.ieeeusa.org. Sincerely, Ralph W. Wyndrum, Jr., Eng.Sc.D. President, IEEE-USA RWW/von:bc Encl. APPENDIX Findings from Official Studies and Reports H-1B (Specialty Occupations) Temporary Admissions Program 1996 - 2005 1. The Labor Condition Application (LCA) program is being manipulated beyond its intent to provide U.S. businesses with timely access to the "best and brightest" in international labor markets to meet urgent but generally temporary needs for specialty occupations while protecting the wage levels of U.S. workers. (May 1996) US Department of Labor, Office of the Inspector General, "The Department of Labor's Foreign Labor Certification Programs: The System is Broken and Needs to Be Fixed." http://www.oig.dol.gov/auditreports/htm [Report # 06-96-002-03-321 2. The Department of Labor's limited authority to enforce program requirements - it cannot take enforcement action even if it believes that employers are violating the law - and weaknesses in the Immigration and Naturalization Service's (INS) administration leave the H-1B program vulnerable to abuse. (September 2000) US General Accounting Office, "H-1B Foreign Workers: Better Controls Needed to Help Employers and Protect Workers." http://www.gao.gov/ [Report # GAO/HEHS-00-157] 3. Much of the information policymakers need to effectively oversee the H-1B program is not available because of limitations in the Department of Homeland Security's (DHS) current tracking systems. Without this information, they don't know if the H-1B program is meeting employers' needs for highly skilled _________________________________________________________________ Page 3 temporary workers in the current economic climate or how to adjust policies that may affect labor market conditions over time, such as the H-1B visa cap. (September 2003) US General Accounting Office, "H-1B Foreign Workers: Better Tracking Needed to Help Determine H-1B Program's Effects on U.S. Workforce," http://www.gao.gov [Report # GAO-03-883] 4. The applications processing system used by DoL is designed to certify labor condition applications quickly rather than to screen out those that do not meet program requirements. In spite of this limitation, the OIG continues to identify cases of fraud and abuse involving LCAs filed by fictitious companies and by individuals who file using the names of legitimate companies without their knowledge or permission. (Sept 2003) US Department of Labor, Office of the Inspector General, "Overview and Assessment of Vulnerabilities in the Department of Labor's Alien Labor Certification Programs," http://www.oig.dol.gov/auditreports.htm [Report # 06-03-007-03-321] 5. Unlike the Permanent Labor Certification statute, the temporary labor condition application (LCA) statute waives a labor market test, does not require submission of supporting documentation by employers, limits DoL's authority to review or question LCAs submitted by employers and prioritizes the processing efficiency rather than the overall effectiveness of the H-1B program. (Feb 2005) Executive Office of the President, Office of Management and Budget, "Department of Labor Program Assessment Rating Tool (PART) Assessments," http://www.whitehouse.gov/omb/expectmore/detail.10002378.2005.html 6. The Citizenship and Immigration Services (CIS) at the Department of Homeland Security (DHS) has neither the technology nor an operational methodology needed to ensure compliance with statutory limits on the numbers of persons who are granted H-1B visas. Faced with the prospect of issuing too few or too many approvals, it has been CIS's explicit practice to avoid approving too few. (Sept 2005). Department of Homeland Security, Office of Inspector General, "USCIS Approval of H-1B Petitions Exceeded 65,000 Cap in Fiscal Year 2005." [Report OIG-05-XX]. http://www.dhs.gov/interweb/assetlibrary/OIG_05-49_Sep05.pdf http://www.ieeeusa.org/policy/flyin/career/default.asp Third Annual IEEE-USA Career Fly-In 2-3 May 2006 What If I Can't Come To Washington? Meeting directly with legislators in Washington is the best way to influence your elected officials. But it is also the most difficult. Not all IEEE members will be able to join us on May 2nd. But there are still ways for you to help technology engineers be heard. IEEE-USA encourages engineers who are interested in these issues to visit our Legislative Action Center to contact their Members of Congress. IEEE members can also sign-up for periodic updates on legislation affecting them through IEEE-USA's CARE Network. 2006 is shaping up to be a crucial year in the H-1B debate. Congress has already begun a major review of immigration policy. Part of that review will focus on H-1B visas. IF YOU WANT TO TELL CONGRESS YOUR SIDE OF THE STORY, NOW IS THE TIME TO DO IT! IEEE-USA is offering all American IEEE members a chance to change the debate in Washington. On May 2 and 3, we will be holding our third-annual Career Fly-In. This event will give all American IEEE members a chance to meet their Members of Congress and staff face-to-face to discuss H-1B visas and other policies affecting the engineering profession. IEEE-USA will arrange your meetings for you and will fully prepare you in advance. All you need to do is come to Washington for the best possible opportunity to influence Congress as it debates the future of your profession. Starting Tuesday afternoon (so you can fly in that morning) May 2, IEEE-USA staff will brief all participants on current legislation, political trends and how to discuss all of this with legislators. Then on Wednesday May 3, participants will travel to Capitol Hill for private meetings in their legislators' offices. Congress is already considering a serious plan to increase the H-1B visa cap by 75% next year. [See Current Political Situation]. Many membersof Congress have concluded that the H-1B program is non-controversial. Engineers who believe otherwise need to come to Washington on May 2 and 3 to prove them wrong! No experience is necessary. All IEEE members in the United States are welcome and encouraged to attend. Politicians respond to numbers. We need as many voters in Washington as possible, so as to send the loudest message possible. ___________________________________________________________________ Current Political Situation In March 2006, Senator Arlen Specter (PA-R) drafted a bill that would, among other things, increase the H-1B visa cap from 65,000 to 115,000 in 2007. The bill would also allow the cap to increase by 15% annually following a year in which the cap is reached. There is no provision to have the cap decrease. Sen. Specter is the Chair of the Senate Judiciary Committee, which has jurisdiction over the H-1B program. This makes him the single most important voice on H-1B issues in the Senate. Other prominent politicians, including Sen. Diane Feinstein (CA-D) have publicly supported Sen. Specter's proposal, showing it has bi-partisan support. On March 29th, the Judiciary Committee approved Specter's bill on a 12 - 6 vote. It now moves to the Senate floor. Efforts to pass the bill before Congress' Easter recess failed, so the bill will be brought back up for debate at the end of April and early May - exactly when you will be here for our fly-in. If the bill passes the Senate, it still must be reconciled with the House version, which has no H-1B provisions. The House has shown greater skepticism towards the H-1B program than the Senate has. A Senate plan to increase the H-1B cap was defeated by members of the House last year. Better yet, on March 30th the House Judiciary Committee's Subcommittee on Immigration, Boarder Security and Claims held a hearing on the H-1B cap. The committee designed a panelof witnesses that favored opponents of raising the cap (including IEEE-USA) by a two-to-one margin. IEEE-USA believes that the best place to stop the Senate bill will be in the Conference Committee between the House and the Senate, which is expected in mid-May, just after the fly-in. Representative Bill Pascrell (NJ-D) has introduced an H-1B reform bill (H.R. 4378) independent of the immigration debate outlined above. Drafted with IEEE-USA's help, this bill would go a long way towards fixing the H-1B program, protecting both American and foreign workers in the process. Pascrell's bill has some Democratic support, but none yet from Republicans. Without bipartisan support, the bill is unlikely to go anywhere. Click To Register Now ___________________________________________________________________ Where IEEE-USA Stands IEEE-USA has long been a leading opponent of the H-1B visa program. We believe that the visas place both American and foreign workers at a competitive disadvantage with respect to employers. Because the visas are owned by employers, visa holders have no leverage to demand fair wages or working conditions and are not able to change jobs. This allows many companies to pay H-1B workers less than American workers for comparable work, disadvantaging both. Also, several different government agencies have found that the H-1B program has major flaws, leaving it vulnerable to fraud and abuse. IEEE-USA would prefer that Congress reform the permanent immigration system. Permanent residents can compete on a level playing field with American workers, providing no incentive for companies to hire one over the other. H-1B visas are not immigration visas and H-1B workers generally do not become citizens. Rather, the visas are short-term work permits that expire in 6 years, after which most workers must leave the country. IEEE-USA would prefer to find a way to keep skilled foreign workers in this country permanently, rather than force them to leave with six years of experience and training. More information on H-1Bs can be found here. More information on IEEE-USA's Career and Workforce Committee can be found here. Click To Register Now ___________________________________________________________________ Fly-In Agenda (tentative) Tuesday, May 2 2:00 - 5:30 p.m. H-1B and Immigration Policy Briefing 6:00 p.m. Dinner (provided by IEEE-USA) Wednesday, May 3 8:00 a.m. - 6:00 p.m. All Day Capitol Hill Visits IEEE-USA will not know your exact itinerary on Wednesday until your meetings are scheduled. However, historically most of these meetings occur in the morning and virtually all before 3:00 p.m. If travel requirements demand that you leave D.C. before 6:00 p.m. on Wednesday, please let IEEE-USA know so that we can arrange your hill visit schedule to accommodate your travel schedule. Click To Register Now ___________________________________________________________________ Contacts: Questions regarding fly-in logistics or Congressional meetings: Russ Harrison IEEE-USA (202) 530-8326 r.t.harrison@ieee.org Questions regarding Congress, legislation and the Career & Workforce Policy Committee: Vin O'Neill IEEE-USA (202) 530-8327 v.oneill@ieee.org