The “America first” crowd should think twice before celebrating the drop in H-1B applications

Built with immigrants.
Built with immigrants.
Image: Reuters/Robert Galbraith
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Fewer foreign workers than before are trying to get over the wall into America this year.

The total number of H-1B visa applications received by the US Citizenship and Immigration Services (USCIS) dipped for the first time in five years, numbering 199,000. That once again far exceeds the annual 85,000 cap of new H-1Bs that will be granted. But relative to previous years, there was less demand for the temporary work visa this time around. Last year, the USCIS received 236,000 applications and the year before, there were 233,000.

Supporters might see the decline as a sign of success for president Donald Trump’s “Hire American” plans. Trump signed an executive order to tighten H-1B laws on April 18, saying many Americans fear that their jobs will go to immigrants.

The numbers don’t change the skills crunch

But most employers agree that blocking more foreign workers from working in the US will not directly translate to more job opportunities for citizens. And even if it did, there simply isn’t enough skilled tech talent available domestically.

“This new constraint will have a severe impact on innovation and the continued maintenance and support of many Silicon Valley tech companies,” Joe McCann, chief executive officer of a San Francisco-based software company, says. “We at NodeSource would hire even more Americans if we could. Yet, we, like every other company, simply can’t find qualified candidates here at home.”

For more than a year, Silicon Valley-based contract and workplace management firm Agiloft has been advertising on multiple bulletin boards—Craigslist, Indeed, Glassdoor, Monster—trying to fill positions. The jobs have all the perks on offer: remote employment, good pay, medical and dental plans, stock options, paid vacation and more. Yet, Agiloft says it has had no luck filling these posts.

The dearth of skilled workers has made competition in the Valley cutthroat. “Fresh computer science or engineering graduates are being paid in excess of $120,000 a year,” Agiloft founder Colin Earl says. “Companies are poaching engineers from one another, paying insane salaries. It’s incredibly disruptive.” Foreign workers are easing the burden for companies. Many of the international applicants have better technical foundations. “Many of them take engineering degrees in China or India or Russia and come to US to do masters or post-grad degrees,” Earl added. “Then they’re highly employable.”

With the looming threat of Trump dismantling the H-1B program as it stands, McCann, Earl and others say they are left with no option but to ship jobs abroad.

The net effect is US jobs lost

A crackdown on foreign-worker visas is “catastrophically bad” for the American economy, Earl says. High-paying jobs can fly out with the skilled workers. He gives the example of Intel’s development, research and production facilities in India and Microsoft’s campus in Vancouver, Canada, to show that companies move where the talent is.

In the short term, the US economy would take a hit from the reduction in taxes collected from foreign workers and the drop in their domestic spending. But the truly crippling impact will be in the long run, as US businesses lose their competitive edge. “We’re creating powerhouses of high-tech firms abroad that inevitably are going to be competing for business long term against American corporations,” says Earl. “When [the engineers] leave, they take that tech knowledge and understanding with them. We’re feeding the competition.”

One of the biggest deterrents to hiring employees who work abroad has been the nightmare of coordinating remote workers. Time differences, the varying sophistication of infrastructure, unreliable internet, and more have been among the headaches. But those difficulties are being addressed with new solutions. With collaborative software like Google Hangouts, Slack and Hipchat, “running remote, distributed teams is not the pain it used to be,” according to Russell Smith, co-founder and chief technology officer of San Francisco-based testing platform Rainforest.

And until the US finds an effective way to train the next generation of engineers, employers will keep finding new ways to work with the best and brightest—wherever they may live.