Give Me Your Yearning High Skilled Professionals

During the 20th century, America's immigration rules evolved from an open-door policy to byzantine restrictions. Most bewildering is the government's reluctance to give strong preference to applicants with advanced training, despite the benefits they bring to the economy and the great demand for skilled workers.

In 1990, Congress made a weak effort to attract these workers by authorizing the Immigration & Naturalization Service to issue 60,000 H-1B visas each year, mainly to applicants with higher education. These are good for three years and can be renewed once. Although Congress expanded the number to 115,000 for this fiscal year, the INS has stopped taking applications for this year, since requests exceed the enlarged quota.

I believe the benefits to America of additional human capital are so great that the H-1B visa program should be folded into a single category that would allow hundreds of thousands of skilled workers to immigrate each year. A starting point would be to eliminate country quotas for skilled entrants and to allow all foreign students who receive masters or doctoral degrees at U.S. universities to stay if they wish. At present, they can work for only one year after graduation.

The current programs that give preference to skilled applicants who want to enter permanently are not working well. Only 80,000 were admitted in 1997 and 1998 under various preference categories for skilled workers, which is tiny compared with the half-million persons who entered with family sponsors.

MODEL CITIZENS. Foreigners who enter with enhanced human capital not only improve their own economic situation but also indirectly help native-born Americans. Almost one-third of the entrepreneurs and higher-level employees in Silicon Valley come from overseas.

Since skilled immigrants earn more than average workers, they pay more than their proportional share in taxes. They make few demands on the public purse, for they have negligible unemployment rates, seldom go on welfare, make little use of Medicare and Medicaid, and commit few crimes. Being mainly in their 20s and 30s, they contribute much more to Social Security taxes than they will withdraw in retirement benefits. Their children tend to be well-motivated students.

Many of those admitted with H-1B visas and under other special programs are in Silicon Valley and other high-tech centers where engineers and scientists are well paid--and scarce. California tech companies have taken the lead in pressuring Congress to expand these programs. Congressional bills supported by both Republicans and Democrats would expand the number of H-1B visas. But to gain political support, even the proposed legislation allows no more than 200,000 a year to enter.

The political resistance to allowing generous numbers of skilled immigrants to enter remains strong. The opposition comes mainly from the unions. Labor claims that skilled immigrants depress the wages and take the jobs of Americans. Opposition also comes from groups such as the Federation for American Immigration Reform, which wants no immigration.

FOR SALE. Yet it is hard to worry about harmful effects on Americans when unemployment among skilled workers is under 2% and when their pay has risen so much relative to other workers. Even a large increase in the number of skilled foreigners would leave the pay advantage of higher-level employees far above what it was a couple of decades ago. High school graduates would continue to have powerful economic incentives to acquire further education and training, which they did throughout the 1980s and '90s.

In previous Business Week columns, I have advocated the sale of immigration rights: Each year, the U.S. would set an admission price for immigrants. Anyone who paid that price and was not barred for other reasons would get a green card. This policy would bring in revenue and would indirectly encourage greater political support for a large expansion in the number of immigrants. Selling entry slots, however, is unlikely to be implemented anytime soon, so the next best approach is to allow easy entry of younger skilled foreigners. They would be willing to pay more than others if rights were sold because the young and well-trained gain the most from opportunities in America.

Ambitious, skilled young people from all over the world are frustrated by backward and inflexible economic and social systems. They are attracted to the U.S. by its dynamic economy and the possibility of upward mobility. Opponents of immigration should not be permitted to nullify a unique occasion to add greatly to the human capital of America.