Immigration and a Reverse Brain Drain?

by David Butcher | August 27th, 2007

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The huge backlog in U.S. immigration visas is leading to a “reverse brain drain” that will force skilled workers to return to their home country and result in a subsequent decline in U.S. competitiveness, a new study shows. Is what’s good for business good for America?

The growing backlog in United States immigration visas is leading to a “reverse brain drain” that will force skilled workers to return to their home country, a report released last week concludes. Roughly one in five new legal immigrants and one in three employment-based legal immigrants are planning to leave the United States or are uncertain about the future, according to a joint study by researchers at Duke, Harvard and New York universities.

Every year, about one million scientists, engineers, researchers and other highly skilled immigrant workers compete for 120,000 permanent U.S. resident visas. In April, the U.S. Immigration and Citizenship Service stopped taking applications for fiscal 2008′s allotment of H-1B visas a mere one day after filing began, when it was flooded with a reported 130,000-150,000 requests for the 65,000 slots available for H-1B visas; hence outcries for raising the cap.

In the study, sponsored by the Ewing Marion Kauffman Foundation, a Kansas City, Mo.-based entrepreneurship organization, the researchers conclude that the number of skilled workers waiting for visas is significantly larger than the number that can be admitted to the U.S.

This imbalance poses a serious threat to American innovation and competitiveness, researchers say.

The Kaufman Foundation’s Intellectual Property, the Immigration Backlog, and a Reverse Brain-Drain study offers the following key findings:

• Foreign nationals residing in the U.S. were named as inventors or co-inventors in 25.6 percent of international patent applications filed from the United States in 2006. This represents an increase from 7.6 percent in 1998.

• Foreign nationals contributed to more than half of the international patents filed by a number of large, multi-national companies, including Qualcomm (72 percent), Merck & Co. (65 percent), General Electric (64 percent), Siemens (63 percent) and Cisco (60 percent). Forty-one percent of the patents filed by the U.S. government had foreign nationals as inventors or co-inventors.

• In 2006, 16.8 percent of international patent applications from the U.S. had an inventor or co-inventor with a Chinese-heritage name, representing an increase from 11.2 percent in 1998. The contribution of inventors with Indian-heritage names increased to 13.7 percent from 9.5 percent in the same period.

• The total number of applicants and their family members waiting for permanent residence in the United States in 2006 was estimated at 1,055,084. Additionally, there were some 126,421 residents abroad waiting for visas, making a worldwide total of 1,181,505.

In January, a study based on telephone surveys with 2,054 companies and projections by researchers at both the University of California at Berkeley and Duke found that foreign-born inventors living in the U.S. without citizenship accounted for 24 percent of patent filings last year. Such patent filings were at 7.3 percent in 1998, according to the report, which also looked at founders of engineering and technology companies started from 1995 to 2005 and analyzed the World Intellectual Property Organization Patent Cooperation Treaty database.

IMT noted at the time of the Berkeley-Duke report:

The study, which comes nearly eight years after an influential UC-Berkeley report on the impact of foreign-born entrepreneurs, notes that, of an estimated 7,300 U.S. tech startups founded by immigrants, 26 percent have Indian founders, CEOs, presidents or head researchers.

“Given that the U.S. comparative advantage in the global economy is in creating knowledge and applying it to business, it behooves the country to consider how we might adjust policies to reduce the immigrant backlog,” Robert Litan, vice president of research and policy at the Kauffman Foundation, said in a statement.

The Kauffman Foundation study is the third in a series of studies focusing on immigrants’ contributions to the U.S. economy.

Is what’s good for business good for America? Or just another red herring? Weigh in with your thoughts below.

Also, stay tuned for related coverage next week in the next IMT biweekly e-newsletter, covering such topics as the state of labor and productivity, the future of manufacturing and engineering, talent management, switching careers and negotiating pay raises, among other things — essentially, our big Labor Day issue.

Resources

Ewing Marion Kauffman Foundation, report and press statement

Agence France-Presse

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Comments:

Bob

August 27, 2007

???
Isn’t it all about replacing American Workers with cheap immigrant labor ??

HAVEN’T YOU HEARD ABOUT THE “HOW NOT TO HIRE AN AMERICAN WORKER” VIDEO???

I direct you to:
http://www.youtube.com/programmersguild +
http://www.eng-i.com/EGG.html

and for additional reading please check
http://www.eng-i.com/E-Newsletters.htm

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IMT editor

August 27, 2007

Bob, that is the question we are asking of you and other IMT readers. Also, we did previously discuss the video you mentioned and, in fact, linked to it in the above post. Please see the link embedded in the third paragraph of this post. Or: http://tinyurl.com/yp8jmb

Thanks for the additional resource, for the feedback and for weighing in.

Cheers,

David

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weaver

August 27, 2007

Somehow, the press-release does not represent the actual wording in the study:

“Two teams of native Chinese and Indian graudate students inspected these records to identify Indian and Chinese names.”

“Of the approximately 130,000 inventors listed on U.S. PCT applications in 2006, 16.8 percent had Chinese-heritage names (mainland and Taiwan) and 13.7 percent had names with Indian origins.”

“By subtracting the number of inventors who were Indian and Chinese citizens, we can create an estimate of foreign-born citizen inventors. According to the last census, 75.4 percent of U.S 70.8 percent of Chinese descent, were foreign-born residents of Asian-Indian descent, and Additionally, 81 percent of foreign born. Indian immigrants and 75 percent of foreign-born Chinese immigrants entered the United States after 1980. 6, 7 These statistics suggest that the vast majority of those with Indian – and Chinese-heritage names are likely to be first- generation immigrants who arrived after 1980″

The contribution of inventors with Indian and Chinese-heritage names increased significantly from 1998 to 2006. In 1998, 11.2 percent of PCT applications had one or more inventor with a Chinese-heritage name; by 2006 this had increased to 16.8 percent. The Indian contribution increased from 9.6 percent to 13.7 percent in the same time period.

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T Wolfe

August 27, 2007

I have to say that what is good for business is not good for the American worker/unemployed skilled American worker. Let’s face it. The labor is cheaper and was easy to come by for businesses. You won’t hear unemployed skilled American workers complaing about it.

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IMT editor

August 27, 2007

Weaver-

The text you quote from the new report (but not from the press release, as you rightly point out) seems to be referring to a January 2007 report from the same organization (see pages 10-11 in the new report).

The January 2007 report would be Part 1 — “America’s New Immigrant Entrepreneurs” — of the three-part series mentioned in this post. The report discussed in this post is Part 3 in the series.

All three reports in the series are available at the Kaufman Foundation Web site.

Thanks for the feedback. Cheers.

-David

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Bob

August 27, 2007

Studies show that most H-1Bs are brought in to be low or even entry-level employees. These are the folks that replaced so many of us in IT, and medicine and education have felt their presence too.

The H-1B is step one in a process that eventually offshores work that used to be done here, much of it vital to our strength as a nation. The H-1B is step one in a process that has moved our personal and financial data to unstable third world countries where they don’t like or respect us very much. The H-1B is why college degrees are worth so little any more, and why our youth need to pick a field that is less vulnerable to competition from the global labor pool, regardless of what their actual talent and passion might be.

They now stand before our elected representatives, bragging about all the good they are doing for our country, and boasting about how incredibly skilled and senior level they now are. They all got to where they are today by displacing or outmaneuvering an American job candidate. There is no job they hold that an American couldn’t have done as well or better. And now they are facing the expiration of their joyride, and want green cards.

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Bill

August 27, 2007

Of course the H1B’s are generating patents now. I used to generate patents too, but now companies say I am “overqualified”. Even if I offer to work for the same wages as the H1B’s they say “you won’t stay long enough for it to be worth it for us to hire you.”

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weaver

August 27, 2007

Appendix A, part three, also refers to Indian and Chinese graduate students parsing the data for Indian and Chinese surnames.

Considering the Census states (2004) there are 8,685,000 Asian born persons in the U.S. it seems that 12,814 Asian born persons participating in the patent process is unremarkable. (0.14754%)

It is my understanding that the (undersubscribed) EB1 visa has a cap of 12,500 per year and patent holders would be preferred for this type of LPR status.

Additionally, American workers are finding themselves “put out to pasture” at age 40, why should the U.S. grant citizenship to aging foreigners who have already made their contribution — why shouldn’t they be replaced by younger workers like everyone else?

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Ed

August 27, 2007

It seems that the Global economy is a concept that is foreign to a lot of middle to lower class Americans.

The reality of the world stage is a fast paced machine that each country must adhere to to stay competitive both in the local sense and especially in the global sense.

The idea that Americans can replace certain foreign individuals and the work they contribute is simple not true in all cases with respect to patents, and such beliefs neither serve America or approach a good/needed attitude in the changing global economy.

If America looses those that contributed 24 percent of the total patents, and these same individual instead create their patents offshore, perhaps in their native countries, that becomes a greater competing factor AGAINST the American economy.

Also, it seems that American’s believe they’ve a right to job security in their country, and the rest of the world should stay out of it. Yet it also seems that these same American’s are unmotivated to change their skill-set to make up the difference in their economy while improving the employable job set. Though probably:(Creating the skill based initiative for shortfalls is a Government planning issue -and literature exposing American needs is probably hard to come by for middle and lower class citizens — and a factor that probably reaches less than 5% of students during their career planning)

Finally, the gentleman or madame that didn’t get a job because of over qualification is also a perception issue.

1, It would SURELY(?) be a hard task to find ALL companies held the opinion that the skills he claims to possess are not a valuable asset to their company. It is bad practice to overlook such value, especially, “and I find it hard to believe that”, if companies would replace such “overly qualified skills” with a lesser model or skill set.

2, There may exist a number of extenuating factors as to why this one particular company failed to see his value. Factors they perhaps may not have shared.

In general, America needs to stay competitive, and the reality of the situation must include the creative possessions of those foreign to American shores.

ed.

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JOHN

August 28, 2007

Much of the cost of government in the US, and subsequently cost in tax dollars to working Americans comes in foreign aid, support of foreign governments we deem “friendly” and in support for humanitarian efforts in the Third World. The need for these various kinds of support always goes directly to the poverty and hopelessness that exists because of the lack of an economy to support the population. Perhaps if these highly educated and motivated persons had any love for their homeland and fellow countrymen they would keep their immigrating asses at home, make IT a better place to live and solve both of our problems. The Third World will remain the Third World as long as the best and brightest leave. At some point they must show some love of country and stay home and be part of the improvement. If the US cannot compete in the global marketplace with home grown talent, perhaps we need to look inward.

Regarding the best interests of this country, if our current
foes’ population had the basics of life, a job that provided a full belly and water to drink and a decent place to sleep and hope for their youngsters, they would be far to occupied with life to be taken in by the hate mongers who have ended up costing this nation billions. Taken on balance, I would venture that the loss that is ESTIMATED by the absence of foreign “talent” taken aganist the KNOWN dollars spent on war, foreign aid of all forms and support of talented and under-employed Americans due to foreign workers, that the absence of the foreign talent would put the US in a far better position economically, socially and politically world-wide than is currently the situation.

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Joy Montgomery

August 28, 2007

A few comments:

There are many unemployed skilled workers who are American citizens. It would be good for America to employ Americans.

American workers are not more expensive when you look at the big picture. Companies should look at waste and ask their workers how to eliminate it. Bringing people here to learn bad processes is not effective. Shortsighted business management is not good for America. Sinking the ship you’re on is a bad idea.

Many of the skilled workers from India and China are lured here with what sounds like great pay only to learn that they have to cram themselves into shared apartments with many others. In one case, a very large Silicon Valley company had Indian SW/HW engineers who were getting $10.00 an hour from the agency that brought them here. You can bet that the company was paying a lot more than $10.00 an hour.

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weaver

August 28, 2007

JOHN makes a very a very good point. Quasi-permanently removing high-skilled individuals from any economy retards capital-investment and prosperity. On the other hand, inflation tends to go hand in hand with prosperity and eventually the cost of skilled-labor becomes comparative in the world-market.

Guestworker policies are protectionist, protecting Global Corporations from the required capital investment that would create inter-dependence upon that foreign economy. Without this investment in inter-dependence, Global Corporations remain free to exploit the “next” emerging economy’s human-capital — abandoning economies as they mature (India and China.)

America has a history which includes high-immigration levels, the historically comparable business-sponsored immigration policy was called slavery.

(The media is full of examples of guestworker abuse in America, Australia, Dubai, Saudi Arabia etc.)

The B visa is the correct visa for business collaboration, the EB2 and EB3 greencard visas require the gracious permission of an U.S. employer and a five year probation called the LPR status. The H and L visa programs are business subsidies with citizenship dual-intent provisions amended to encourage potential guestworkers to enter into serfdom.

Business sponsored immigration is a perversion of the American tradition. Instead of gaining self-reliant immigrants with deep convictions, (risking all for America’s shores) we gain meek scabs with a proven history of running from difficulty.

It’s completely predictable that the “reverse brain drain” would occur, this is just another contrived economic bubble that is now justly bursting.

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Ed

August 28, 2007

Actually, John, two ideas to address your points:

1st
The US economy is positioned at the foundation level of the World economy, along with China, and the other Five Nations.

It isn’t enough to insist that Third World economies foster their talent… and therefore those that can raise their countries standard should stay in their countries where they can do the most good. In such countries, the capacity to implement ideas is vastly underdeveloped.

The whole inter-dependence arrangement is where talent may be fostered, and if the individuals fortunate enough to receive such talent have a mind to, they can take their developed skill sets back to the countries of their birth in the capacity of developing their countries.

While such individuals are in the employment of America, America will receive the benefits.

2nd
Because of its foundation level, and its dependence on foreign contribution, it can’t simply cut off such fostering without a large impact worldwide. However, while it does foster outside talent, there is scope to further develop and implement in-house policy.

Honestly, how many Americans are capable of listing the exact skill short fall of America? I even wonder if any politicians are capable of listing the skill short fall. And more importantly, how many of the students currently in study know exactly what Americas’ needs are? And therefore are capable of designing their education to better position themselves in a competitive employment market.

I’d be surprised if that percentage was greater than 1% of total Americans!

I don’t agree that America can afford to let foreign potential go at this time. But I also don’t agree that it can’t afford to foster Americans either.

On a global note, designs have a far-reaching impact, and it seems that this is a point that people overlook. Such that on the global scale, everyone benefits when new designs are created that creatively deal with issues such as global warming, future oil shortfalls and dependence.. etc.

Country pride at the expense of global-sensibility seems to be deep-rooted to the point where such considerations don’t rate a mention. Fair enough to a point, as most are concerned about more local issues, such as feeding their family, housing and work, etc., but, surely, global sense should be amongst those concerns?

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JOHN

August 29, 2007

Ed: your points all have merit, but “when up to your ass in ‘gators, it is hard to remember you are draining the swamp.”

The ‘gators exist in huge sizes in the Third World and their consequences are difficult if not next to impossible to solve if all the “brains” leave for greener pastures… success in stemming global warming by perhaps foreign talent working in the US is a “zero net effect” when in the
Third World, the pollution created in just trying to live another day surpasses the efforts.

China is perhaps the best example of what can be accomplished, abet harshly to the point of cruelity, when attitude is changed, talent is exploited in the fact that those whose abilities are extended by training in the developed nations are REQUIRED to return home and apply that talent to the betterment of the local/national economy.

This is in sharp contrast to what we are generally seeing today, in that those who come here to learn and earn do not go home. We hear much about the fact the the US as we know it was populated and developed by immigrants and that we are “all immigrants”. But that was a time when the nation was a vast, empty “pot” waiting to be filled by those who, in wanting a better life for themselves, created a better economy for all.

But today the pot is full and running over…the the apparent success of the economy on the world stage has made the US an envied and hated entity. If we cannot estimate the exact skill short-fall, can we afford to not look at how long, with our current political/social/economic face, the Third World will allow us to continue with the gap as it is presently.

Extremists are using religion as the tool to destroy the US economic engine…their hatred is not religious based, it is economy based and until that issue is addressed, there will be no security or lasting peace.

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Bob

August 29, 2007

When all that people can do is insult Americans they don’t even know, that is a sign of losing an argument. How does anyone know that Americans didn’t keep their skills current? I know many who not only did that but upgraded their education and training, even while being laid off. And, what good did it do them?

The purpose of the H-1B was to TEMPORARILY fill spot shortages until American workers could be found or developed. That even one American was displaced is proof that the program has been abused, yet there are documented accounts of thousands of Americans being discarded and foreigners hired in their places. The H-1B program is so rife with fraud and abuse that surely no one can defend it with a straight face any more. Yes, Americans have ‘first call’ rights to the work of America.

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cam

August 30, 2007

it appears we still have vast empty pots in our midst we have government taking workers hard earned taxes and giving it to able-bodied, too-lazy-to-work Americans. i had to qualify and take a drug test to make money that went to taxes. Why not the same requirements for those receiving. If you enjoy a salad orange a night dining out, surely even one with a lick of sense can add several more better. Keep these immigrants. america’s problem is politians naivete & lazyness

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Ed

August 30, 2007

John,

No offense intended, but some of your ideas are not clearly articulated.

When you start mixing ideas such as security, economy and development, and try to address them as a combined issue in the context of the brain drain, all points become clouded and unclear.

It is important to foster talent, no matter where it comes from. And the World does benefit from such advancements, which may include Global Warming reduction measures. So it is short-sighted or rather pessimistic to count development as non- or zero-conducive towards developing practical answers to the global warming issue and other issues that benefit mankind worldwide.

Fortunately, I live in a country that does have the capacity to develop talent, and part of that capacity/government policy includes immigration.

2nd
Up until last year, Global warming was an issue in denial, and Bush was one of the advocates that lay in skepticism. Fortunately, world pressure and Global Weather disasters has forced Bush into a more sensible response and outlook that has been implemented in government planning, such as 2 predetermined, preplanned, and pre-approved Nuclear Power plants to cut down the red tape, and speed up the production of hopefully pollution free power to meet USA needs.

This pressure shows such that no country is immune from, and China will also have to address this issue and find methods to temper the huge pollution problem it’s creating.

3rd
The exploitation of China’s people is a sad fact and shame on that country, but it’s not really an issue of the brain drain either. And like global warming, changes in those areas must be effected by outside/world pressure.

4th
I have a sense of who I am and where I come from, and that sense is not country based but rather culturally and family/heritage based. So I can’t see myself leaving behind who I am if I were to venture offshore. I would return. But obviously, not everyone has such a strong sense of identity, and people that leave will stay where they wash ashore, if they are welcomed and enabled to develop. But it is still no argument against fostering talent. And actually goes as bias in favor “for”. Why? Because the country that fosters them gains a loyal contributor.

Finally,
I don’t identify with America envy and hate. Yet, I have use of my voice to speak up on many issues, including speaking against the shortsighted attacks on other countries such as Iraq. And I have use of all methods at my disposal to get my message out there. Some of the techniques I’ve used could easily be construed as USA hate and envy. especially from a USA perspective. But it’s not, more so a highlight of cultural difference.

Unfortunately, there’re people that do hate America, and were given just cause when members of their family were killed in the many wars that America felt justified to construct. And that damage is veal real, like the bombs that blow up daily around the world killing more and more people. “the hate merry-go-round that USA and bush are equally guilty of perpetuating.”

But this is no argument against the brain drain either. Keep the issue clear. The plain and simple fact is America needs the help, and until it fosters its own in house policy where the skill shortfall is finally known on the street level, such that Americans can actively work towards filling those needs, then America is always going to be dependant on outside help.

~~~~

Bob?
“When all that people can do is insult Americans they don’t even know, that is a sign of losing an argument. How does anyone know that Americans didn’t keep their skills current? I know many who not only did that but upgraded their education and training, even while being laid off. And, what good did it do them? ”

From that I am left to wonder if you need to learn how to disconnect from words, as no insults were given? Again, no offense intended: It is a sign of lack when you are unable to be impartial and speak/write to ideas with such impartiality.

You bring up an important point in your next paragraph. And that is the trend that many Americans are being displaced, but I question where that displacement is actually occurring? Brain nuts are extremely hard to replace, and mostly likely only replaced by people who offer some added or great benefit.

It seems more likely that you’re referring to the labour market more than white collar and Brain market.

2nd
The trend is a key that shows you something needs to change for you to stay competitive in your changing market.

2nd (Abuse of)
The abuse issue is governmental issue that should be addressed but lets keep the issue clear. It’s not about the BRAIN “as that is a MOST HIGHLY PRIZED AND NEEDED COMODITY FOR ALL COUNTRIES” but about employers taking advantage of or exploiting other people. just like the CHINESE, it SEEMS that Americans are no better?

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Ed

August 30, 2007

1 more point to add.

It’s a sad and true fact that some Americans have grown FAT POCKETS/WALLETS from the Iraq war.

Lobbyist that advocated “for” the war and profited from such advocation have to be removed. (its a shamefull state) Otherwise, the incentive for war, and therefore the profits that are gained through such efforts will always be a carrot of temptation.

And political spin and manipulation will always eventuate when the gathered forces/lobbyists’ for war outweigh the voices of reason.

Governments should make weapons manufacture a state affair/publicly-owned and all privatisation and privately owned weapons manufacture should be outlawed.

though this is another off the point / topic, it needs to be said.

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JOHN

August 31, 2007

Ed; I was ready to see some merit in your discussion, particularily to the points I raised, but to attempt to pull concerns about immigration, brain drain, backward economy in countries with a one-way flow of talent to the US, and world security apart is not looking at the interdependance of actions among countries and their ctizens in all aspects and conditions.

NOTHING effects attitude like desperation and hunger and both are solved in a large measure by viable economy. The unwillingness of those with talent to do something about that in their homeland is shameful.

My hometown is overrun with medical doctors and a major part of the glut are Indian… but their homeland has one of the highest poverty rates in the world and 1/4 of the population earns less than $0.40 per day while it has the highest rate of malnutrition among children under 3 year in the world some 46%. I feel somewhat justified in pointing out that our call for unfettered immigration does as much harm to large numbers of the world’s population as the “bush-war in Iraq”, againist an imagined foe, at the time, has done. Do you have a feel for how many children are represented by 46% of the under 3 population in India?
You mention that it is a simple fact the the US needs help and until we do something about it, it will come from the outside.

The solution is one of intervention if one buys into the arguement that the solution is not here. If that is true, the best way to solve any inability of a human nature, is to remove the crutch, do not allow unfettered immigration to be the unabler…we need to rise or fall on our own as an economy or suffer as did other civilizations who became to lazy and brought in others to solve tasks and do the work to sustain the economic engine only to find too late that the “help” were now in charge and we were the major contributor to our own economic demise.

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Ed

August 31, 2007

John,

it’s a great point you’ve brought to this discussion table. that is, “crutch removal”!

I’ve had to struggle to develop my talents, coupled with the daily struggle of living with very little. i.e. unable to pay bills on time, living on a budget that meant necessities were all one could afford, and sometimes not even able to afford that. Under those conditions, no matter how talented the person may or may not be, one is always forced to find ways to cut corners while trying to meet ones needs especially to a workable standard. Necessity is the mother of invention, -the old adage goes.

Yet, I don’t see your (?) govervenment, the American government removing crutches. policy changes always disadvantages some faction of society and advances another… which those advancements could be seen as nothing more than crutches. Policy is a crutch!

I mention USA dependance on outside BRAINS for one simple reason, to climatise — to allow the ability to develop in house poilicy without loosing footing and base share in the world economy while transitions are built.

Also John, I can’t see any politican getting behind your crutch removal idea, ((but it needed to be said) as policy making at its core is all about crutches, and in a sense you’re talking about removing government altogether!! Not such a bad thought huh? self governing people.. )) you may get 1 %, even as much as 10 % of politicians to support that idea, but beyond that seems fanciful.

I know what it is to be desperate and continuously hunger, but how I handle that and my attitude is not a reflection of the hunger, but of my inner makeup. hunger does nothing but test… and some steal, or worst, loose all self worth because of hunger… so I’m not sure what your point there is. inner drive to steal or to rise? only one is a shame.

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web tasarımı

August 12, 2009

You mention that it is a simple fact the the US needs help and until we do something about it, it will come from the outside

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