US tech talent shortage? That's hooey

While companies insist America's education failures make more H-1B visas for foreign workers a must, the numbers say otherwise.

By Jason Notte May 1, 2013 11:59AM
Man working in data center © Erik Isakson, Tetra images, Getty ImagesThe U.S. has become an educational wasteland that has led to a dearth of science, math and technology talent for its growing tech sector.

Believe that, and we'll show you the ocean cliff from which you can summon the Kraken and order it to smite your enemies.

The Senate's current immigration bill only furthers the narrative that the American workforce is too stone-dumb to be of any help to the tech sector. The only solution, it asserts, is to increase the annual limit on H-1B visas, which allow corporations to bring employees with a bachelor's degree to the U.S. from overseas for up to six years. As Quartz points out, however, the H-1B provision is based on a myth.

While Facebook (FB) chief executive Mark Zuckerberg readies a political action committee to ram the provision through to President Barack Obama's desk, the Economic Policy Institute issued a report that flatly dispels the claim that more visas are the answer.

U.S. colleges are churning out more programmers and engineers than the job market is absorbing. Roughly twice as many American undergraduates earn degrees in science, technology, engineering and math disciplines than go on to work in those fields. In 2009 alone, less than two-thirds of employed computer science grads were working in the info-tech sector a year after graduation.

While shortages may exist in niche industries like cloud software development or Android programming, Quartz says there isn't a broad dearth of talent. What there is, however, is a bottom line that needs to be maintained through young, cheap labor.

University of California at Davis computer science professor Norman Matloff scoffs at H-1B visas, calling them a means of procuring cheap, "indentured" labor. While companies are supposed to hire H-1B immigrants only if no Americans are available to do the job -- and then are required to pay them on the same scale as U.S.-born professionals -- legal loopholes leave the process vulnerable to exploitation.

Companies save money by hiring a younger H-1B visa holder with less experience. Those same visa holders also have a tough time negotiating for promotions, raises or even a chance to open their own businesses because most of those moves would cost them their visas. Companies are well aware of this and hire H-1B workers from outsourcing firms by the thousands as a result.

As The Boston Globe discovered, just four companies -- New Jersey-based Cognizant Technology Solutions (CTSH) along with India's Tata Consultancy Services, Wipro (WIT) and Infosys (INFY) -- claimed 20% of the 134,780 H-1B visas approved in 2012.

More on moneyNOW

May 1, 2013 12:15PM
So this writer is confirming what many of us already suspected, CEOs of many companies lie.

So here's the real truth. They prefer paying lower salaries to non-Americans as opposed to paying a full Wage and Benefits to Real Americans. Meanwhile they jack up their own Wages and Benefits.
May 1, 2013 12:42PM

“...the H-1B provision is based on a myth”

Not really.  It is based on a well-financed lobbing campaign.  As Sen. Robert Bennett (R-Utah) described a past H-1B expansion:

"Once it's clear (the visa bill) is going to get through, everybody signs up so nobody can be in the position of being accused of being against high tech.  There were, in fact, a whole lot of folks against it, but because they are tapping the high-tech community for campaign contributions, they don't want to admit that in public"

Rep. Tom Davis (R-Va.), about the H-1B:

"This is not a popular bill with the public. It's popular with the CEOs.  This is a very important issue for the high-tech executives who give the money"

The H-1B visa has always been promoted as fixing a shortage of American while really providing cheap labor.

May 1, 2013 2:00PM

The new immigration "reform" package allows US companies like Microsoft to continue to hire as many H-1Bs as they can; the only part of the bill that has an impact is that it may make it a little harder for Infosys, Tata, and the Indian firms to bring their indentured servants here.  I'm sure they will find a way around it, and will find willing US companies to conspire with them to keep rates down. 


H-1B visas for IT jobs simply are not needed; as the article points out, there are lots of Americans looking for employment in this sector with the right skillsets and knowledge. 


The real problem with hiring overseas "talent" for this kind of work is that it makes it much easier to ultimately move the work overseas because the H-1Bs go home eventually, and can claim experience working in the US.  So, not only do we lose jobs today, they are gone in the future too.

May 2, 2013 10:40AM

I agree with this article.  Please allow me to add that if there really was a "STEM graduate shortage" then we wouldn't have so much age discrimination with STEM jobs.  I lot of competent STEM educated people have been laid off over the past twenty years, but still hear "you're over-qualified) from the same employers who cry about a "STEM competency shortage". 


If the problem was just money, these STEM employers would snap up every new STEM graduate they could find.  But they're not. 

May 2, 2013 4:02PM

Everybody in the I/T field knows this,  but for some reason the politicians and many on the right believe it to be true.    They have decimated a high paying technical field in less then 10 years by using h1b visas and farming the work out to cheap labor countries.   It is truly a shame on our govt and companies that bear no responsibility for our future.

May 2, 2013 4:16PM
May 2, 2013 3:26PM
Thank you for shining some light on the hooey.  It would be nice if American companies felt some allegiance to the  American worker.  
May 2, 2013 4:42AM
This legislation doesn't close any loopholes.  It raises fees on the Indian H-1B body shops, meaning that Congress just gets more money for disenfranchising MORE US STEM workers.

Here is a story of a NASSCOM lobbyist holding court with the two most powerful Democrats in the Senate, Chuck Schumer and Harry Reid.

May 2, 2013 2:17PM
Same thing happens with in health care, the hospitals exploit foreign doctors and nurses at the expense of US nationals. It is the bottom line that matters.
May 2, 2013 8:29PM
Sorry, good article and nothing but the truth we have plenty of tech engineer and they are very good and they are much better than the Indians by far. The just hire Indians because they are a warm bodies and cheap. The bottom line is they someday are going to make products that are better than ours because we have put our technology in their laps. This is a big mistake and the companies that are doing the outsourcing should be heavily taxed. If they the CEO don't like it they can leave.
May 3, 2013 8:00AM
and the savings go right into the CEO's pockets, while our economy tanks. Thanks you greedy bastard's. They care the one's causing American's to lose faith in capitalism.
May 3, 2013 2:31AM

We need to organize the high tech community both IT & Engineering to stop the passage of this Immigration bill. We didn't do anything about NAFTA & look what it did to the high tech community - all the jobs going overseas. Now this immigration bill is going to make easier for the companies to bring the immigrants here to take the IT & Engineering jobs. We need to pay attention to the re-elections of the Gang of Eight that created this bill & anybody that supports it. They are NOT the friend of the American workforce that is so under & un-employed.

May 3, 2013 2:09AM

Greenspan when asked why so much work is being farmed out overseas stated "no more work is being sent overseas than ever before and the reason so much work goes overseas is because the American workforce is not educated or skilled enough to do the work". Made me so mad I clipped the article out of the newspaper. It seems our Congress has bought what Greenspan was saying hook line & sinker for the benefit of all those high paid CEOs that fund their superpacs - on both sides of the aisle.

May 29, 2013 2:39AM
The only shortage is a shortage of companies willing to pay fair market wages.
Gaming the system at all levels it status-quo for America and we shouldn't accept it any longer.

May 6, 2013 8:27PM

I agree.  Having spoken to hundreds of technical persons at job fairs, talked with employers that admit foreign workers are cheaper to hire, we do not need more H1-B visas.  This idea has been promoted by Bill Gates and others as the only way to procure the technical talent needed.  It also flies in the face of proven technical economics that date back to the 1960s.  Especially in the programming and related IT areas.  Simply stated, if a person was competent in at least one language, then another could be acquired in three to six months.  There are only a few companies that really have embraced this timely fact. 


One company, stated that those that understand that a changing world needs to have persons take on new skills is the new norm.  Those that were are working on projects that are terminal because of the language or aging technology, and do not take advantage of the company's training provisions, will be out of a job once their project is complete.  Good sense, good company initiative to preserve specialized human capital and good sense in saving on recruiting. 


We have plenty of people that handle these jobs.  I have no problem meeting them at job fairs.  It is the overspecialization of requirements.  The human traders (external recruiters), non-technical human resources and too many embracing the idea that a "perfect" fit needs to be found to "hit-the-ground-running" is what separates needs from reality.  There is a better way but business does not want to embrace it.  The Department of Labor is deaf also.  I know because I even submitted research related to the WIA program and nothing gets noticed unless you are a billionaire.

May 3, 2013 8:01AM

Grrr, the word I meant to write was "are" not "care."


May 2, 2013 12:04PM
This is the biggest bunch of bull I have read hear in a long time.  The unemployment rate in IT in Austin, Tx is about 2%.  I have 4 recruiting firms looking for programmers for my company.  

If you are a programmer with web development experience seeking full-time employment, send me your resume.
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