To: H-1B/L-1/offshoring e-newsletter Sun May 18 13:21:06 PDT 2014 Archived at http://heather.cs.ucdavis.edu/Archive/ssp To: H-1B/L-1/offshoring e-newsletter Sun May 18 12:42:00 PDT 2014 A major newspaper, the Pittsburgh Post-Gazette, is running a series on immigration, starting today with the article at http://www.post-gazette.com/local/city/2014/05/18/Pittsburgh-s-economy-has-gained-from-high-skilled-immigrants/stories/201405180099 The title of the article (chosen by the editor, not the reporter) says it all: "Pittsburgh's economy has gained from high-skilled immigrants." Unfortunately, the article doesn't make a case for this. Take for instance the CMU professor profiled in the piece, Tai Sing Lee. As some readers know, I'm partial to the Cantonese, and I say, good for him. (And for his cancer researcher wife.) But surely the P-G can't be saying that without immigration, CMU wouldn't have been able to fill Dr. Lee's position. I've always strongly supported the notion of facilitating the immigration of the world's best and brightest, and CMU faculty such as Prof. Lee presumably qualify. He SHOULD be here. But even then, an internal paper at the National Science Foundation correctly forecast in 1989 that the large influx of foreign students would suppress STEM PhD wages, causing Americans to avoid doctoral work. In other words, foreign students have displaced U.S. citizens and permanent residents in grad school, and thus also in university faculties. In light of my work and that of others that the average quality of foreign students is somewhat lower than that of the Americans, this displacement represents a net loss to the U.S. economy, contrary to the title of the P-G article (which, in fairness, was likely chosen by the editor, not the reporter). When one talks about immigration and the economy, it is important to define one's terms. For the "We need America to rule the world" crowd, immigration has arguably achieved their goal, in terms of absolute GDP. But for the rest of us, measures such as per-capita GDP are far more relevant. There are a number of studies showing that the American middle claas has lost ground in the past few decades, and I think it's clear that immigration has played a role in that. In STEM areas the evidence connecting stagnant wages and "challenging" job searches to immigration is compelling, in my view. To me, the economic case for immigration is weak at best. Instead, I regard the big success story for immigration to be another theme of the P-G article, demographic diversity. Things are much better in that asepct since when I was a kid. (If you aren't interested in diversity, skip down to the material on Mastech below.) Ironically, immigration is actually now REDUCING diversity in some ways. I grew up in the then lower middle class white area of the San Gabriel Valley in the LA region. In my high school graduating class of 400, we had just one black, two Asians and maybe three or four Latinos. For a while, immigration worked very nicely to diversify the area, but today it is solidly Chinese, from Alhambra to Diamond Bar. Mark Keppel High School in Alhambra is 70% Asian. The Chinese kids at Keppel are probably just as cloistered was were the white in my school. (Though Valley Blvd. is a 15-mile long Chinese epicurean delight.) I couple of years ago I attended a meeting with other researchers at Company X, one of the very top household name tech firms. One of the people we met with, Ms. Y, is of Indian ethnicity, and she proudly told us of the diversity immigration had brought to the top ranks of Company X. But of the names she rattled off of vice presidents at X, every single one was Indian, not very diverse after all. I am delighted to see more Indians rising to top positions in industry and government, but the above pattern is a little troubling to those of us who do value diversity. A field shouldn't be dominated by one race or ethnicity. Now, let's look at Westinghouse and Mastech, the firms the article lauds for contributing to Pittsburgh's economy: "The first big wave of Asian immigrants came here in the 1960s and 1970s, when the former Westinghouse Electric Co. nuclear research operations in Monroeville hired many Indian engineers, and the regions' hospitals and universities began to recruit Indians as professors and doctors. A later surge of Indian immigrants arrived in the 1980s and '90s to work as computer scientists for companies like Mastech, founded by Indian-American entrepreneur Sunil Wadhwani." Well, not so fast. Let's take Mastech first. Mastech is one of the firms that placed "H-1B only" job ads in 2006, as reported at the time in Computerworld, http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleI d=9001285 which reported "For instance, in a search on the job board run by Dice Inc., iGate Mastech, a Pittsburgh-based IT staffing agency with about 1,000 employees, has an advertisement for eight Java developers with three to five years of Java development experience. The ad says: 'Only looking for H-1B visas and should be willing to transfer.'" Mastech claimed the ad to be a "typo." Well, that would be a whale of a typo, thus hard to imagine, especially since Web data seems to indicate that Mastech is one of those firms that hires almost all of its workers from abroad. Mastech doesn't seem qualified for the "poster-boy" status given it by today's P-G article. Nor does Westinghouse, another firm cited positively by the P-G article. I'll come back to Westinghouse shortly, but guess which law firm Westinghouse chooses for at least some of its immigration work: Cohen & Grigsby, of "Remember, we're trying to NOT find an American to fill the job" notoriety. This will take a bit of explaining--I'm not engaging in guilt by association here, which the "Microsoft hired Abramoff!" people do in my opinion--so please bear with me. Back in 2007 the firm Cohen & Grigsby, highly prominent in Pittsburgh, held an information session for clients, and as a marketing tool, placed videos of the proceedings on the Web, involving green card applications. Unlike H-1B, employer-sponsored green card law requires the employer to show that qualified Americans could not be found to fill the job. C&G showed how employers could make a pretense of looking for Americans yet still be in full compliance with the law. The MC of the videos, C&G partner Larry Liebowitz, introduced the topic with his infamous statement: "And our goal is clearly, not to find a qualified and interested U.S. worker. And you know in a sense that sounds funny, but it's what we're trying to do here. We are complying with the law fully, but ah, our objective is to get this person a green card, and get through the labor certification process. So certainly we are not going to try to find a place [at which to advertise the job] where the applicants are the most numerous. We're going to try to find a place where we can comply with the law, and hoping, and likely, not to find qualified and interested worker applicants." Remember, this is fully legal, and standard. In fact, various lawyers, and the AILA, jumped to C&G's defense in the furor that resulted from publicization of the videos by the Programmers Guild. The lawyer who literally wrote the book on the green card process, Joel Stewart, has said, ""Employers who favor aliens have an arsenal of legal means to reject all U.S. workers who apply." Note carefully that another video in the series advises clients how to get around the prevailing wage requirement, again fully legally. Prevailing wage applies to both green cards and H-1B. Cohen & Grigsby is, as I mentioned, highly prominent in Pittsburgh, and it appears to have an excellent relationship with the Pittsburgh Post-Gazette, the newspaper whose article I'm reviewing in this posting. The paper has quoted C&G on various occasions, and ran an op-ed by Liebowitz, the partner mentioned above, in which he said, "U.S. companies that bring in foreign professionals usually do so as a last resort...These rules actually help U.S. workers, too, by...ensuring that U.S. workers are not displaced..." The reason all this is legal is that Congress--or actually the industry lobbyists--inserted huge loopholes in the laws and regulations. Before 2004, for instance, it was legal to pay an H-1B 5% below prevailing wage. The latter has its own loopholes, and is a flagrantly lowball figure to begin with (as even strident H-1B program advocate Rep. Zoe Lofgren has admitted), but hey every loophole counts. And my point is that you can see that C&G's clients were typically paying 5% below prevailing wage--including Westinghouse: http://heather.cs.ucdavis.edu/Archive/CohenAndGrigsbyPrevailingWage.txt Note, by the way, that the firms listed there are mostly mainstream U.S. firms such as Westinghouse, NOT the Indian offshoring firms (though Mastech, mentioned earlier in this posting, is one). Abuse of H-1B pervades the entire industry. Any "blame the Indians" statement by politicians or the press constitutes unwarranted scapegoating. All in all, a very one-sided article. However, the reporter interviewed me for almost an hour, and I sensed that he is astute and fair. I'm looking forward to seeing the subsequent pieces in the series. Norm Archived at http://heather.cs.ucdavis.edu/Archive/PPG.txt