Immigration Policy Center: H1Bs and The Innovation Economy

This month, the American Immigration Council’s (AIC) Immigration Policy Center (IPC) released an excellent background paper on the contributions of high-skilled H1B workers to America’s innovation economy. This articulate and well-researched piece, amply supported by research findings from leading academics and policy experts, shows just how essential H1B workers are to job creation in the tech sector and beyond. [See High-Skilled Workers and Twenty-First Century Innovation: The H1B Program’s Impact on Wages, Jobs, and the Economy, Immigration Policy Center, Apr.2014.]

The IPC paper is also a persuasive rejoinder to the small-but-noisy contingent of anti-immigrant doomsayers whose opposition to the program seems to know no rational bounds. As IPC says up front: “Arguments that foreign-born workers and immigrants are depressing wages or displacing native-born workers are contradicted by the available evidence.” In the pages that follow, they marshal an impressive body of data to prove their point. Among the highlights:

• H1Bs are widely distributed across the USA, in a variety of fields: contrary to popular belief, significant numbers of H1B workers are found all across the country, in 106 major metropolitan areas – not just in Silicon Valley, and not just in IT. Although almost two-thirds of H1B requests are for STEM occupations, IPC points out, “workers in healthcare, business, finance, and the life sciences are also in high demand.”

• H1Bs provide talent for hard-to-fill STEM jobs: IPC cites a 2013 Brookings Institution study, which found that “43 percent of new vacancies in STEM occupations for which there are H1B requests go unfilled after one month. In the 100 largest metropolitan areas in the United States, 46 percent of job openings requiring significant STEM knowledge go unfilled for one month or longer, and STEM employers report thousands of unfilled positions.”

• H1Bs are associated with significant wage growth for college-educated, U.S.-born workers, according to a 2013 study that examined data from 1990-2010. Based on this study, IPC notes that “a one percent increase in the foreign-born STEM worker share of total employment in a city over a decade increased the wages of both STEM and non-STEM native-born college-educated workers by 4 to 6 percent.”

• H1Bs are well paid. Far from being cheap labor, as some critics charge, a 2013 Brookings Institution study found quite the opposite: that, “in general, H1B workers are paid more than their non-H1B counterparts within the same occupations for workers with similar experience.”

• Each H1B job creates five new jobs. “Long-term research shows that, in addition to bringing more jobs and higher salaries to communities where they cluster, the impact and success of innovative industries in localities has a profound multiplier effect.” [emphasis in original]

This multiplier effect extends to a broad swath of professionals – doctors and lawyers, for instance – as well as service-industry employees that owe their jobs to the prosperity wrought by the innovation economy, and the H1Bs workers who are driving it.

The IPC paper is an excellent introduction to the H1B program for anyone who’s unfamiliar with it, and a useful compendium of facts about the many benefits that reverberate through our economy, thanks to H1B workers. It’s worth reading in its entirety, and holding in reserve to answer the skeptics!

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