With the tech boom over, Congress has allowed an expanded visa program aimed at foreign high-tech workers to lapse, but debate is still raging over the needs for the US technology workforce.
The expanded program for H-1B visas -- provided for workers with special skills -- expired with the end of the fiscal year Sept. 30, bringing the cap down to 65,000 compared with 195,000 over the past three years.
The expanded cap was enacted in 2000, when unemployment was at record lows and US companies complained about a shortage of high-technology workers.
About half of the H-1B workers came from India, with large numbers coming from by China, Canada, Britain, the Philippines and South Korea.
But even with the lower cap, some complain that the influx of foreign workers has led to higher unemployment and lower wages for the tech sector.
"We hope [the lower cap] helps, but there are still hundreds of thousands of people on the visas that are already here," said Chris McManes of the US arm of the Institute of Electrical and Electronics Engineers.
McManes said that the H-1B and other types of visas for tech workers -- including the L-1 visa for intra-company transfers -- have "exacerbated high-tech unemployment, which is at unprecedented levels."
He said official data show the unemployment rate for electrical and electronics engineers -- just one category of tech workers -- rose to 7 percent in the first quarter of the year, the highest since the organization began keeping records in the 1970s.
But some say the US will need more high-tech workers from abroad when the economy picks up.
Eleanor Pelta, an attorney in Virginia who represents employers, said demand for new H-1B visas outpaces the 65,000 cap.
"The 65,000 is not going to be sufficient," Pelta said.
"Congress is very reactive when it comes to immigration. By the time they look at an issue and make a decision, often the economic conditions have changed. That's what I'm concerned may happen here," Pelta said.
Clouding the debate over visas is the growing trend for US firms to outsource functions in the high-tech sector to other countries like India or the Philippines.
According to the Commission on Professionals in Science and Technology, the share of foreign-born employees in the information technology (IT) workforce has doubled in the past decade.
But outsourcing of IT work to foreign locations has quadrupled since 1995 to over US$1.2 billion in value in 2001.
Bob Cohen, spokesman for the Information Technology Association of America, which represents tech companies, said it is likely that firms will outsource work offshore if they cannot find workers at home.
"The intuitive argument is that companies not able to get access to specific skill sets may instead send those jobs offshore," Cohen said.
But McManes said that the increased use of foreign IT workers has led to greater outsourcing to other countries.
"We think it's fueling outsourcing because people are coming over here and gaining intimate knowledge of US business practices and making contacts," McManes said.
"Armed with that knowledge, they go back to wherever they're from and help in outsourcing," he said.
The institute argues that as a result of these guest worker programs, the US is losing skills and its competitive advantage in technology, and would be better off with programs leading to citizenship.
The group also says Congress should provide more enforcement mechanisms to ensure that temporary IT workers are paid prevailing wages in the US.
But Cohen said the H-1B program has been an important tool for US industry for decades.
"The way the program performed showed it was self-correcting," Cohen said.
"As demand for IT workers fell, demand for H-1B visas fell. The program worked the way it was supposed to work," Cohen said.
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