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Breaking Views

Don't shut foreign tech workers out

The recession has renewed attempts to restrict visas for skilled immigrant workers who are the lifeblood of Silicon Valley.

By Jeff Segal, breakingviews.com

(breakingviews.com) -- The recession's damage to Silicon Valley goes beyond falling stock prices and depressed profits.

The downturn has renewed attempts to restrict visas for skilled immigrants. If anything, the U.S. should consider slackening its rules instead.

Granting more visas for high-tech immigrant workers, known as H-1Bs, was a hot topic before the economy went into reverse. Now they're perfect political toast.

The U.S. stimulus bill included an amendment forbidding any institution receiving TARP money from hiring H-1B workers. Senator Chuck Grassley, one of the amendment's authors, sent a letter to Microsoft (MSFT, Fortune 500) telling the company to fire foreign workers before American citizens.

Now Grassley and Senator Dick Durbin want to add further restrictions to the H-1B visa program. Their legislation aims to limit the number of workers that outsource companies, such as India's Infosys (INFY), bring to the U.S. If passed, the provision would make it harder for all companies to hire foreign workers.

The legislation would be particularly toxic for Silicon Valley. H-1B visas may be temporary and forbid holders from working in self-employment, but the benefits to the U.S. are still high.

A 1% rise in the share of immigrant college graduates in the population increases the total number of new patents by 6%, according to a study by Jennifer Hunt of McGill University and Marjolaine Gauthier-Loiselle of Princeton University.

The benefits are long-lasting too. Many visa holders eventually settle permanently in the U.S., make money and pay lots of taxes.

Indeed, foreign workers found 52% of all technology startups, according to Duke University professor Vivek Wadha. Some of them, or their offspring, have even created giants.

Google (GOOG, Fortune 500) co-founder Sergey Brin is a native of Russia. Andy Grove, a Hungarian-American, was Intel's (INTC, Fortune 500) third employee. And Ebay (EBAY, Fortune 500) was started by French-born Iranian-American Pierre Omidyar.

If the U.S. wants more Silicon Valley powerhouses, loosening the H-1B rules would be a good place to start. True, only 65,000 visas are issued each year. And hard times reduce immigration, so the damage might not be immediately felt.

But placing artificial constraints on the flow of highly educated and skilled workers is short-sighted. When the global economy recovers, the U.S. should want the best minds available to capitalize on it. To top of page

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