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Greg Siskind on Immigration Law and Policy

WHARTON SCHOOL STUDY: SKILLED WORKER SHORTAGE CONTRIBUTES TO OFFSHORING

Rating: 2 votes, 1.00 average.

Despite Lou Dobbs' twin attacks on H-1B visas and on offshoring, the actual connection between the two is the opposite of what Dobbs contends. A lack of access to skilled workers actually drives many companies to move jobs overseas where adequate numbers of skilled workers are available. We saw this a few months back with the big news that a lack of H-1B visas was the primary reason Microsoft decided to put a major research center in Vancouver rather than Seattle.



Now a new study from the University of Pennsylvania's Wharton School of Business and Careerbuilder.com confirms this. In the study, 27% of companies said the lack of needed skilled workers is the major reason behind offshoring of jobs.

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Comments

  1. EB3's Avatar
    27%? That's pretty low. Not sure why you'd crow about it. Clearly, the real reason why companies do this is wages are cheaper overseas. It has little to do with where the H-1B cap is set. Drop the AILA talking points. See this article from today in which EDS admits "If you can find high-quality talent at a third of the price, it's not too hard to see why you'd do this": http://www.itbusiness.ca/it/client/en/home/News.asp?id=48091.
  2. George Chell's Avatar
    "27%? That's pretty low. Not sure why you'd crow about it. Clearly, the real reason why companies do this is wages are cheaper overseas. It has little to do with where the H-1B cap is set. Drop the AILA talking points. See this article from today in which EDS admits "If you can find high-quality talent at a third of the price, it's not too hard to see why you'd do this""

    The rest go through FDI. A significant proportion of jobs have been relocated to Australia, Singapore and the UK as well where the wages are similar if not higher than the US. Actually it is the other way around. As jobs move abroad wages stagnate and unemployment increase. In the 1990s when H1 B was at 150,000 on average, jobs did not move abroad in search of low wages and more such skilled jobs were created driving the overall unemployment rate to 3.6%. It is a vicious circle now which began with the 2003 cap.
  3. BeeDee's Avatar
    News report about an unusual anti-immigration faction in Congress:

    http://news.medill.northwestern.edu/washington/news.aspx?id=86933
  4. George Chell's Avatar
    Also dont underestimate the poor quality of talent here in the US based on consequences such as the Minnesota bridge collapse, New Orleans levy leaks, and in the MBA world, the best talent we had..executives of Citicorp, Bears Stearns, Washington Mutual and the various Airline corps who do a lousy job and make tons of money..if this is the best and the brightest we have we need more skilled immigration not less and jobs will continue going abroad. Also dont underestimate the fact that Americans want higher wages for everyone, ie., wages of airline pilots, but dont want to pay the higher price as in the case of airline industry. The result is heavy losses for the airlines...and guess what no corporation wants to go through what the airline industry is going through. As long as Americans are unwilling or unable (cannot afford) to pay higher prices corporations will go looking for low wage labor. Simple balance sheet.
  5. George Chell's Avatar
    "News report about an unusual anti-immigration faction in Congress"

    Lamar Smith has had a change of heart on H1Bs. I wonder why? Can Greg shed light on this?
  6. hmm's Avatar
    AP reports that in regards to Congressional Hispanic Caucus statement Rep. Zoe Lofgren, D-Calif., who chairs the House Judiciary immigration subcommittee, said in an interview that it would be difficult to pass a comprehensive bill this year given the Senate's failure.

    "I guess the real question is if you can't do everything you want is that an excuse for doing nothing," said Lofgren, who's held a hearing on seasonal workers but also on the comprehensive reform bill supported by the Hispanic Caucus. Lofgren also sponsored a bill extending visa eligibility for religious workers that the House passed last week by voice vote.
  7. Sam's Avatar
    May be they are listing http://www.govtrack.us/congress/bill.xpd?bill=h110-5882 a new bill has been introduced in the House of Representatives.

    Greg,
    what are the chances of this bill passing?
  8. Greg Siskind's Avatar
    Hi Sam - I knew this was coming, but my sources tell me that any bills of this sort will have a tough fight. Possible, but tough.
  9. John D's Avatar
    "unusual" anti-immigration faction? they're holding skilled and legal immigration needs hostage to pursue their illegal immigration agenda. i'm a Democrat, but i'm painting targets on the Congressional Hispanic Caucus. the country is not united on issues around illegal immigration, and our legal and skilled immigration needs must not be held hostage! "you don't want to know how sausage and laws are made."
  10. Ryan G's Avatar
    The lack of skilled workers mentioned in the Wharton School of Business is a very serious predicament for the U.S economy. Training these new competent skilled workers is crucial to keeping jobs in America. In a recent study produced by the Imagine America Foundation, it was found that from the 3,000 career colleges in the U.S, these schools will produce graduates to fill 22% of the skilled worker jobs. To find about more about this study go to www.imagine-america.org.
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