Wednesday, April 27, 2005

Bill Gates and Visas

Bill Gates, who is just like us except a little bit richer, wants to get rid of the upper limits on H1-B visas, the visas for importing goddesses and other smarties to the United States (I must come clean on this one: I rode in on one of those little visas). His companies need to hire more engineers and the U.S. market can't fill the need. So Gates wants to let more well-trained workers into the U.S..

Wouldn't foreign workers compete with American ones for scarce jobs? Not according to Gates:

Gates and other leading technology executives have pressed Congress aggressively to let them hire more foreign employees by raising visa limits, but Gates hasn't previously campaigned to abolish the immigration law entirely. Technology executives have argued they are unable to find qualified American workers, a contention disputed by U.S. labor groups and unemployed computer engineers.

"Anybody who's got good computer science training, they are not out there unemployed," Gates said. "We're just not seeing an available labor pool."

Is he correct? Not completely, for two reasons. First, the unemployment rate for information technology (IT) workers is not especially low:

Government figures showed 5.7 percent of information technology employees were out of work last year versus 5.5 percent of all workers.

In fact, the IT unemployment rates are higher than those for managers and professionals in general, too.

Second, there is evidence that many trained for the field are drifting out of it because of difficulties of finding a good job match. The major reason for this is in outsourcing of IT jobs.

In some ways Gates is advocating more choices for American firms at the expense of American workers. Under his scenario firms could outsource jobs or import workers, whichever turns out to be more profitable, and the U.S. workers would have to compete both at home and abroad with foreign workers.

Traditional economic analysis supports Gates's ideas. But we don't live in the kind of world which the traditional models apply. The markets are not really competitive, retraining is difficult and expensive and rules and regulations about workers' rights, the environment and business ethics all vary widely between countries.

In any case, Gates is pushing for an idea that would cost him or his firm nothing. Alternative ways of increasing the supply exist (educational scholarships, for example) but they have the liberal handicap that they actually require some resource sacrifices from the people who stand to benefit.