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Tech Industry

House OKs more work visas

The House passes legislation increasing the yearly quota of visas for highly skilled foreign workers.

    After a late-night deal with the White House, the House passed legislation today to increase the number of highly skilled foreign workers allowed into the country each year while laying out some assurances that U.S. workers won't be displaced by H1-B visa holders.

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    Following negotiations with Sen. Spencer Abraham (R-Michigan), the Clinton administration agreed to boost the number of H1-B visas for technical and well-educated workers from 65,000 to 115,000 in 1999 and 2000. However, the cap will drop to 107,500 in 2001 and return to the current level by 2002.

    The House passed a substitute version of Rep. Lamar Smith's (R-Texas) Workforce Improvement and Protection Act by a 288-133 vote. The Senate still has to approve the bill.

    "With the White House now on board, I hope we can enact this law very quickly," Abraham said in a statement. "I am convinced this legislation is crucial to maintaining American economic competitiveness and to protecting American jobs."

    In return for the increase in visas, a select number of high-tech companies that hire a lot of H1-B employees will be subject to increased Labor Department monitoring. The bill also imposes stiffer penalties for firing an American worker in order to hire a foreign one. Companies can't pay H1-B visa holders lower wages than their American counterparts, either--a practice that is known to happen. Violators could be banned from the H1-B program for three years.

    And in a move to quell opposition, National Science Foundation scholarships for low-income students in math, engineering, and computer science also will be substantially increased to $75 million per year, paid for by revenue gained from increasing fees for visa applications up to $500.

    The H1-B visa quota became a contentious issue for the high-tech industry last September, when the cap was reached for the first time. This fiscal year the cap kicked in with four and a half months of the year still to go, prompting more calls for a higher limit.

    H1-B employees typically work in the electronics or software industries, and many are recent college graduates hoping to prolong their stay in the United States. The jobs can be high-paying, heightening fears that foreigners will work for lower wages than Americans would accept.

    "This allows us to attract 150,000 of the best and brightest around the world to come here and create the foundation for new products that can then help employ about a million more Americans," said Reed Hastings, president of the bipartisan lobbying group Technology Network. He noted that he expected the bill to pass quickly through the Senate if it passed the House.

    During the debate today, Intel chairman Andy Grove was highlighted as an example of an immigrant who built a high-tech company that created scores of American jobs. Ironically, Intel is set to lay off 3,000 workers this year and up to 700 employees next year--although many of the positions being eliminated are in manufacturing, so the pool probably doesn't include many H1-B-caliber positions.

    High-tech firms contend that H1-B workers are not usurping jobs from Americans, but rather are complementing shortcomings in the U.S. educational system. Additionally, some members of Congress believe that the shortage in native workers owes to a deficiency in the number of women entering and advancing in the high-tech field.

    But opponents of the bill say it helps give U.S. jobs away to foreigners.

    "[This bill] allows some of the best jobs in the high-tech industry to go to foreign workers, while those very same companies have spent the last year laying off hundreds of thousands of workers," said Rep. Ron Klink (D-Pennsylvania).

    It is estimated, for example, that Compaq Computer will cut up to 10,000 workers in the wake of its merger with Digital Equipment.

    Others also are expected to do away with jobs this year: Xerox will reduce its staff by 9,000 workers, electronics company AMP will eliminate 3,500 jobs, and Nortel, which acquired router maker Bay Networks, said this month that it will cut 3,500 jobs.

    Klink and other Democrats also complained that the compromise was done behind closed doors even though the House Judiciary Committee passed its own version of the bill by a 23-4 bipartisan vote in May.

    Rep. Mel Watt (D-North Carolina) tried to offer the Judiciary bill as a substitute, which would have pumped the visa cap up to 95,000 this year and up to 115,000 in 2000. The amendment also would have applied Labor Department scrutiny to a wider range of companies and require that firms make a "good faith" effort to first hire American workers. But the House rejected the proposal.

    Rep. Zoe Lofgren (D-California) of Silicon Valley supported passage of the compromise bill. "The H1-B program extends beyond computer specialists," she said during the debate.

    The Smith bill could be a first step in training more Americans for lucrative jobs. "We need to get into the schools that have been neglected," Lofgren said

    At the behest of the high-tech industry, in May the Senate easily passed Abraham's American Competitiveness Act, while Smith introduced similar legislation in the House. Smith's bill was due for a floor vote last Thursday, but it was pulled in part because Abraham was negotiating with the White House.

    The Clinton administration first signaled its uneasiness with the legislation during the summer. Despite changes, it then issued a veto threat, calling for more protection for American workers.

    Some critics say Clinton, embroiled in the White House sex scandal and bracing for possible impeachment proceedings, is aligning himself more closely with the most liberal members of Congress, who have opposed increasing the number of skilled foreign workers allowed into the country for fear of irritating organized labor unions. But the administration itself typically has been mindful of big labor, notwithstanding its more recent enthusiasm for the high-tech community.

    Clinton's concessions to the high-tech industry are not going unnoticed. Tomorrow, the president will attend a $25,000-per-couple fundraising event organized by Tech Net for the Democratic National Committee at the Tech Museum of Innovation in San Jose, California.