Complicated issue
      In 1998, Congress added legislation to the FY1999 omnibus spending bill raising the caps on H-1B visas, which provide foreign workers authorization to work in specialized occupations in the United States for up to six years. The caps were raised from 65,000 to 115,000 for FY1999 and FY2000, and to 107,500 in FY2001. In a compromise with critics, who were concerned about the impact on U.S. workers, lawmakers added language requiring a small portion of businesses that depend heavily on the H-1B program to show they made good-faith efforts to find U.S. workers to fill the jobs first. And those companies are prohibited from laying off existing workers with similar skills.
      "We need something different besides just continuing to try to increase the cap to put Band-Aids on a program that's broken," said Lynn Shotwell, legal counsel and director of government relations for the American Council on International Personnel.
      Industry officials say one of the reasons why the cap will be hit again despite the increase — as of the end of April, 103,753 H-1B visas had been used, according to the Immigration and Naturalization Service — is that many of the visas went to clear out a backlog of requests from 1998. Given that Congress cleared the legislation after the start of the new fiscal year it did not include a provision, included in earlier versions of the legislation, to clear out the 1998 backlog. They also note that lawmakers did not increase the cap as high as industry wanted.
      But John Fraser, acting administrator of the Labor Department's wage and hour division, said the reasons for hitting the cap are more complicated. In addition to clearing out the backlog, he notes rising incidents of fraud in the H-1B program. Another potential factor are concerns raised by Abraham that INS officials may be over counting the number of visas that have been used. An INS spokesman, however, said while the agency has had problems in the past gaining an accurate count, it has instituted reforms that they believe have addressed the issue.
      The short-term impact on industry until the new batch of visas is available when the new fiscal year begins Oct. 1 is hard to determine.
      Beall says one immediate problem is that U.S. companies cannot hire foreign nationals who will be graduating from college this spring.
      Some companies, such as Intel, planned ahead given their expectation that the cap increase would still be insufficient to meet the need.
      "We pretty much knew it would happen," said Jenifer Eisen, Intel's manager for human resources policy. "We tried to hire people up front... and the people we can't, we will send to overseas projects" or leave the positions unfilled.

Still dispute over problem
      While industry says it is looking for ways to cope with the need for workers, there are still those who question whether there is really a shortage.
      It is difficult to find independent statistics that will provide a good assessment of the employment picture in the high-tech sector. Government officials say they are only now beginning to compile data that might provide a clearer picture.
      "There will be a continuing growing demand for [high-tech] workers," Fraser said. "There's no dispute on the demand side. The question is on the supply side. But there hasn't been any good evidence that helps answer the question of whether there is a real problem."
      Some industry officials point to a Commerce Department study in 1997 that backed up the industry's claim of a high-tech worker shortage. But a General Accounting Office study released in March 1998 was critical of the department's report, saying it contained "serious analytical and methodological weaknesses that undermine the credibility of its conclusion."
      Still, Thom Stohler, director of human resources policy for the American Electronics Association, points to several factors that he says bolster the industry's claims. He notes that Bureau of Labor Statistics figures show that unemployment in key high-tech fields such as electrical engineering and computer programming is well below the overall unemployment rate. In addition, he points to studies, such as one recently conducted by AEA, that show the number of college students graduating with high-tech degrees has declined in recent years.
      Immigration critics dismiss such studies as skewed and intended to support industry claims. They continue to charge that the high-tech industry is using H-1B visas to import lower-paid workers. Industry opponents also say that if there is a shortage, it will force wages to rise and persuade more Americans to seek high-tech careers.
      "They need to be looking around and inducing people in our workforce" to seek high-tech careers, said John Martin, special projects director at the Federation for American Immigration Reform, a group that has been skeptical of efforts to increase immigration into the United States. "The fact is, the big companies are being very picky."
      Industry officials dismiss such criticisms, saying they do all they can to first seek out qualified U.S. workers. They say it often costs more and takes much more time to hire foreign workers.

Looking for alternative solutions
      Yet even though the Labor Department officials have yet to acknowledge a shortage, they agree with industry's call for a new approach to employment-based immigration.
      "I think everybody would agree there ought to be long-term solution," Fraser said. "I would believe that the long-term solution is in our permanent immigration policy" and not in programs that provide temporary immigration like the H-1B visa program.
      Many industry officials say that they often use the H-1B program for foreign workers they would like to hire permanently. But given that it may take several years before a worker can obtain a green card necessary to work in the United States permanently, companies often use H-1B visas to ensure that those workers can remain in the United States as they wait for a permanent spot.
      Some industry officials say they would like to see the process for obtaining a green card streamlined and expedited.
      "If we could get the permanent system fixed, then a lot of people could skip the H-1B" program, Shotwell said.
      Fraser said the administration proposed some changes to the system in the president's FY2000 budget. They include consolidating control over the process within the Labor Department from two agencies to one. He said putting it under one agency, the hour and wage division, will make it easier to streamline the system to operate in a more timely manner "without sacrificing protections for U.S. workers."
      The plan, however, must still gain congressional approval.
      High-tech company representatives say if government officials fail to address the problem they will be left with little choice but to move some positions to other countries.
      "More jobs will move off shore," said Harris Miller, president of the Information Technology Association of America. "Our opponents, don't seem to understand that India and Ireland and South Africa and Brazil and Mexico and China and all these other countries are taking advantage of their short-sightedness."
      Fraser said its not a threat the administration takes lightly but adds that U.S. policy must balance this with concerns that an influx of foreign workers could drive down wages.
—by Juliana Gruenwald