Figures recently given to Congress by the Immigration and

Naturalization Service show that the 10 companies using the most visas

last year all provide contract labor and services -- jobs like computer

and software installation and maintenance that critics contend do not

necessarily require college-level math and science degrees.

The designation H1-B is used for work visas intended for hard-to-fill

jobs. Many technology companies say they need to import more workers under the H1-B program

because of a shortage of technically proficient domestic workers to fill crucial electrical engineering

and product development jobs -- positions that often require master's or even doctorate degrees.

And yet, the company that imported the most foreign labor last year under the H1-B program is the

Mastech Systems Corp., a Pittsburgh company that received visas for 1,733 employees -- or about

80 percent of its domestic work force -- to bring in software programmers with only bachelor's

degrees.

"This is not brain surgery," Representative Ron Klink, a Pennsylvania Democrat, said of the jobs

being filled by foreign workers at companies like Mastech. "These jobs do require some skill and

intellect. But American workers can be trained to take these jobs."

Klink, a member of the House Commerce Committee, requested a recent General Accounting

Office review that questioned the extent of the shortage of technology workers.

He and other critics want Congress to hold the line on the number of

visas rather than adopt a proposal by Senator Spencer Abraham, a

Michigan Republican, that would raise the number of H1-B visas to

95,000 from 65,000.

American industry, they argue, is exaggerating the dearth of qualified

labor market to import foreign workers who are willing to work for

lower pay and who take jobs from Americans.

Supporters of the Abraham bill, which is scheduled for a Senate vote

early next month, say the current ceiling will be reached in May, four

months before the end of the Federal fiscal year and leaving many

crucial technology projects at risk.

No comparable House legislation has yet been introduced. But the

House Judiciary Committee's subcommittee on immigration is holding

a hearing on Tuesday. And the chairman, Lamar Smith, a Texas

Republican, said he hoped to have a bill offered within a week and passed by the full House by the

end of the month.

Industry lobbyists say the shortage of high-tech workers is so acute that failing to raise the cap could

threaten one of the most vital parts of the nation's booming economy. Companies unable to fill

crucial positions in this country, they say, will have no choice but to send more sophisticated

technology projects overseas.

The American information technology industry has 346,000 job openings -- more than enough to go

around for foreign workers and Americans alike, said Harris Miller, president of the Information

Technology Association of America, a Washington trade group.

"Our focus is on growing the U.S. work force," Miller said.

Complicating the debate are some seemingly contradictory trends, as some key parts of the industry

-- including personal computer makers and chip companies -- are grappling with cyclical softening

of their markets.

Two weeks ago, for example, the Intel Corp. played a lead role in releasing an industry study that

contends there is a dire shortage of skilled technology workers. By last week, the company was

announcing plans to cut some 3,000 jobs, mainly through attrition, in response to weakening

demand for its microprocessors.

But the kinds of jobs going dark and the kinds going begging are not of the same skill level,

according to Tracy Koon, an Intel spokeswoman. The company is always on the lookout for the

type of highly skilled employees who receive most of its H1-B visas. At Intel, about 3 percent of a

work force of 67,000 people have been hired via H1-B visas, and nearly 80 percent of the

immigrants hold master's degrees or doctorates, Ms. Koon said.

Two other Silicon Valley advocates for the Senate bill, including the National Semiconductor Corp.

and Varian Associates Inc., have frozen their work forces at current levels.

Varian Associates, which is based in Palo Alto, Calif., is a maker of laboratory instruments, medical

equipment and semiconductor manufacturing equipment. It has only 30 H1-B visa holders among its

7,000 employees and is not currently seeking to add any new high-skill positions. Nevertheless,

Varian wants the immigration cap raised.

"We don't know when the crunch is going to come; it's so cyclical," said Ernest M. Felago, Varian's

vice president of human resources. "Our only point is that it's another source of labor, so why dry it

up?"

National Semiconductor, also a chip maker, said that 55 of the 450 technical people it has hired this

year required H1-B visas.

Even though the company has imposed a temporary hiring freeze, National Semiconductor, like

Varian, wants the visa limit raised to be assured of having access to the best talent from where ever

and whenever necessary.

"We would probably support taking the lid off altogether, but that's pretty radical at this point," said

Tom Wulf, director of staffing for National Semiconductor.

A problem with even the current caps, according to companies which seek the highest-skilled

foreign workers, is that too many of the H1-B visas are being used to fill jobs that do not require

searching overseas for candidates.

"They should be hiring double-E people and people in product development," Wulf said, using an

industry abbreviation for electrical engineers. "Otherwise," he said, they shouldn't be allowed to use

the visas."

But Mastech, for one, makes no apologies for using the visas or for bringing in such a high

proportion of immigrant labor. Mastech began as a high-tech personnel service but has expanded

into helping companies design, install and update office computer systems.

"The whole market has grown so fast and the talent keeps declining," said Chuck Rudisill, investor

relations director for Mastech. He said the company has been forced to dip into the foreign labor

pool for even bachelor-degree holders, not to pay lower wages but because of the dwindling

number of American computer science graduates.

"For companies like us to continue to grow, we have to go around the world to recruit," Rudisill

said. "And there are so many unfilled positions in the United States that if we weren't paying market

rates, they wouldn't be joining the company."

Mastech said that most of its H1-B workers arrive with a bachelor's degree in computer science

and three to five years of work experience. But Klink said that many of the jobs at Mastech and

companies like it do not require math or science degrees. Programming, he contended is a skill that

many underemployed Americans can easily be trained to do.

During the 1993 and 1994 votes on free-trade treaties, "we were being told that as we entered the

new information age, our workers were going to be training for new information technology jobs,"

Klink said. "Now, only four years later, we're being told we don't have enough people, our people

aren't trainable."

As the debate rages, even basic data are being questioned about the extent of the job opportunites

in information technology. In addition to the the Information Technology Association of America

study that found 346,000 job vacancies, the Commerce Department has estimated that the

information technology industry will need an additional 1.3 million workers over the next decade.

But the recent General Accounting Office review questioned the validity of those numbers and the

methods used for calculating them.

And while the industry points to figures showing wages in information technology are as much as 64

percent higher than the national average, critics say a rather modest wage growth in the field does

not bear out claims of a labor crisis.

Norm Matloff, a computer science professor at the University of California-Davis, said that Norm

Matloff said that Bureau of Labor Statistics indicate salaries for computer programmers rose 7

percent last year -- not a rate that would indicate employers are desperate for new labor, he said.

Michael Teitelbaum, a demographer with the Sloan Foundation who served from 1994 to 1997 as

vice chairman of the Congressionally mandated United States Commission on Immigration Reform,

said that the "main thing to remember about this industry is that it's boom and bust," recalling

massive layoffs in Silicon Valley five years ago.

"I would say it would be a mistake if you don't have a clear labor shortage -- which we have no

credible evidence to support at this point -- to take action on a bill which would make a very

substantial increase for the next five years," he said. "That would be most unwise."

Who Uses High-Skill Visas

Across the country, thousands of foreigners with special work visas, called H1-B

visas, are working for technology companies that say they need the foreign labor to

fill skilled jobs that cannot be filled by Americans. Some critics, though, contend that

the workers are not necessarily more skilled, just less expensive. Here are the

companies with the largest number of these workers.

Source: Immigration and Naturalization Service

SANTA CLARA, Calif. -- Even when the chips are down, there is guarded optimism among

job hunters here in Silicon Valley.

Because of a downturn in the semiconductor industry, only 375 high-tech companies showed up last

week at this region's largest job fair, 125 fewer companies than in February. Still, the mood was

clearly upbeat among thousands of job seekers, many of whom came to the job fair already

employed and simply looking for an upgrade.

Then there was the cautionary note. While applicants gobbled up fliers

promoting high-paying job opportunities, some said they worried that

corporations would just as soon fill those jobs with foreign-born skilled

labor. And those who are concerned don't want Congress to permit

companies to hire more foreign-born workers.

"Give the jobs to people from our country first," said David Pendleton, a

46-year-old technical trainer, recently laid off by a wafer manufacturer,

who said he already has some job offers. "Too many qualified people are being squeezed out by

foreigners."

As Congress debates legislation that would increase the number of visas for highly skilled foreign

workers, the political forces have weighed in on both sides of the question. Some studies conclude

that additional foreign workers will steal jobs from U.S.-born workers, and lead to lower wages.

Other research validates corporate claims: that there is a shortage of highly qualified U.S.-born

workers, and they need foreign labor to compete.

Down in the trenches of Silicon Valley, the feelings among prospective employees are equally

mixed. Opinions like that of Pendleton seem to be held more widely among workers over 40. Their

concern is that corporations would rather not spend even a penny on retraining a skilled, but

displaced, worker, and would rather hire a foreign worker freshly trained in the technology du jour.

They said that if the chip freeze spreads, they will be the ones left out in the cold.

Some of the older U.S.-born workers at the Westech Job Expo said they believed that foreign

workers, who often are young, are willing to put up with long hours and lower pay to gain entrance

to the United States.

"I can't say a negative thing about foreign workers because they're doing what our grandparents

did," said one 44-year-old woman, who asked that her name not be used. "But companies are

losing out on an older work force that has the right skills."

One major corporate technical recruiter, who also requested anonymity, conceded that "it is a

consideration" that foreign-born laborers will accept lower wages. On the whole, though,

corporations vehemently insist that is not the case, and they say they will pay market wages so long

as they can find qualified workers.

And it definitely appeared at the job fair that job hunters had the upper hand. Corporations were

naked in their pursuit of the best programmers and engineers, offering on-the-spot interviews, and

readily mentioning signing bonuses. Some of the booths set up by corporations touted other perks:

"Every other Friday off," said one sign; "Pre IPO stock" read another; "No layoffs," noted a third.

No layoffs? It turns out the booth belonged to the United States Postal Service. "We offer lower

pay, but we have great job security," said Ruth Rudolph, business systems analyst for the Postal

Service. The booth nevertheless didn't look to be particularly popular.

But there was a catch: the Post Office only hired permanent residents and U.S. citizens. As many as

40 percent of the 15,000 job applicants at the job fair were foreign born -- and seeking work visas,

according to recruiting coordinators.

Angela Kang, recruiting coordinator from Oracle Corp., said 40 percent of the hundreds of resumes

she received during the job fair were from people who were educated outside the United States.

Indeed, the sea of faces looked like a United Nations gathering: with heavy attendance from people

from India, China and Taiwan.

To some U.S.-born workers, this was of little concern. "Jobs seem to be plentiful," said Kristi

Williams, a 25-year-old Unix programmer who recently was laid off from a semiconductor

company. Williams said she doesn't worry foreign labor will undercut her job hunting; in fact, she

welcomes skilled labor. "I would rather see immigration from people who are qualified," she said.

Ditto for Anthony Anchetta, a 29-year-old CAD designer who expects to have no trouble now that

his most recent employer relocated from Silicon Valley. And the same goes for Brian Benson, an

18-year-old who is enrolled in a vocational school to learn to rebuild computers. He said he wants

to gain technical skills to support his snow-boarding hobby, but he said many of his peers in the

United States are "not ambitious enough" and have opened the door to foreign labor.

"I know so many people who just want to party and get high," Benson said, noting that the job fair

proves there are plenty of jobs for people willing to work for them. "I'm glad people are coming

over here -- they want to work" so hard.

Some of the foreign-born workers at the job fair said they believe they have a more serious work

ethic than their U.S. counterparts. Their reactions were more mixed when asked whether they

would accept lower wages in exchange for obtaining a work visa.

Jiang Wong, a 34-year-old who is nearing completion of a Ph.D. in chemistry from the University of

Southern California, said he might accept a salary of $55,00 from a semiconductor company -- a

wage demand that seems relatively modest. But he said if he can't find work in the United States, "I

can go to another country -- I have a lot of choices."

April 20, 1998

Visa Levels Are a Priority for Congress

By JERI CLAUSING

ASHINGTON -- Legislation to increase the number of visas for skilled foreign workers is

a priority when Congress returns this week from a two-week spring recess.

With the current quota of 65,000 nearly hit just eight months into the

current fiscal year, the Senate Judiciary Committee has already

approved a bill by Senator Spencer Abraham, a Michigan Republican,

that would raise the number of so-called H1-B visas to 95,000 this year,

and to 115,000 next year through 2002.

That bill is tentatively scheduled for a floor vote in early May.

In the House, Representative Lamar S. Smith, a Texas Republican who

heads the Judiciary Committee's immigration subcommittee, is holding a hearing Tuesday on the

H1-B program and other workplace issues.

Smith supports raising the H1-B cap, but has not yet filed any legislation of his own. Among the

issues he wants to explore is the threat that American workers might be displaced by an increase in

the cap, according to his spokesman, Allen Kay.

"He does believe there is a shortage of workers," Kay said. "He does believe a temporary increase

is a good way to address that, but he has some concerns about worker protections."

Kay said he expects legislation to be filed in the House within a week of the hearing, so both houses

of Congress can pass bills and get the matter to a conference committee by the end of May or early

June.

The Clinton administration has said it will support a temporary increase in the visa program, but that

it wants it to be coupled with stronger guarantees that companies will make a greater effort to train

more American workers.

Commerce Secretary William Daley said the administration is backing a proposal by Democratic

Senators Edward M. Kennedy of Massachusetts and Dianne Feinstein of California that would

increase the quota to 90,000, but only for three years. It also would cancel the renewal option that

effectively extends the term of the three-year visas to six years, and it would impose a $250

application fee to finance a $100 million training program for American workers.

The Abraham bill authorizes spending $50 million for training American workers, but there is no

guarantee the money will be appropriated.

"We are trying to work with the Senate," Daley said. "We are not at this point for just unilaterally

raising the cap. There needs to be some real reform."

"We stress strongly the need for the business community to retrain workers," he said. "We've got to

address the quickly changing jobs. Business has got to take the lead.