Statement in Congressional Record by Sen. Spencer Abraham (R-MI). Re: Introduction of S 2045 IS, the American Competitiveness in the 21st Century Act. Date: February 9, 2000. Source: Congressional Record. See also, Summary of H1B Visa Bills in the 106th Congress.

Mr. ABRAHAM. Mr. President, I rise to join Senator Hatch in introducing the American Competitiveness in the 21st Century Act.

Mr. President, no company can grow if it fails to find enough employees with the skills needed to get the job done. And that is precisely the situation faced by our high-tech companies today. A Joint Venture: Silicon Valley study found that a lack of skilled workers is costing Silicon Valley companies $3 to $4 billion every year. A Computer Technology Industry Association study concluded that a shortage of information technology professionals is costing the U.S. economy as a whole $105 billion per year.

These costs should not be seen as mere abstractions. Because of skilled labor shortages, an increasing number of highly productive firms have had to curtail their economic activities and/or move offshore. At an October 21, 1999 Senate Immigration Subcommittee hearing, Susan DeFife, CEO of womenCONNECT.com, noted that `as investment capital flows into start-ups and puts them on a fast growth track, the demand for workers will continue to far exceed the supply. In order to fill these positions, the options for tech companies are not particularly attractive: we can limit our growth, but then we lose the ability to compete; we can `steal' employees from other companies, which makes none of us stronger and forces us to constantly look over our shoulders; or, in the case of larger companies I know, move operations off-shore.'

None of these solutions is good for our economy or our workers. As e-commerce and other forms of high technology become increasingly integrated throughout our economy, the long-term solution to our dilemma will be for earlier and better training for our young people to qualify them for high-tech tasks. But we are losing productivity and opportunities for growth right now. If we are to maintain our high-tech edge in an increasingly competitive global market, we must find the skilled workers we need wherever we can.

We must meet our training and education needs. And we need wise and careful reforms to our immigration laws. This is not an either/or proposition. We have studied this approach for some time. In February of 1998 the Senate Judiciary Committee held a hearing on high technology workforce issues. This hearing demonstrated that many companies could not find enough qualified professionals to fill key jobs. It also showed that the foreign-born individuals hired by companies on H-1B temporary visas typically many additional jobs for Americans through their skills and motivations.

Mr. President, shortly after that hearing, Congress raised the cap on H-1B visas from 65,000 to 115,000 in FY1999 and 2000, and 107,500 in 2001. A number of provisions in this legislation increased enforcement efforts and established a $500 fee per visa--currently generating $75 million per year--for training and scholarships to encourage Americans to enter high-tech related fields.

Unfortunately, this was not enough. Despite the raised cap, a tight labor market, increasing globalization and burgeoning economic growth all combined to increase demand for skilled workers. The 1999 cap on H-1B visas was reached by June of last year.

We must do more to enable American employers to hire job-creating high-tech professionals. That is why I have sponsored this legislation that would:

Provide a temporary increase in H-1B visas. Caps would be increased by 80,000 for FY 2000; 87,500 for FY 2001; and 130,000 for FY 2002.

Create exemptions for universities, research facilities, and graduate degree recipients to help keep in the country top graduates and those who help educate Americans.

Modify per-country limits on permanent employment visas to allow companies to hire talent without regard to nationality.

Increase labor mobility by allowing H-1B professionals to change jobs as soon as the new employer files the initial paperwork, instead of waiting for a new H-1B application to be approved.

Continue and extend the $500 per visa fee to provide over $150 million in additional funding over three years for training and scholarships. Counting the existing money brought in by the fee, this will raise the total to over $375 million over three years and will help over 50,000 American students receive scholarships in math, science or engineering.

These provisions will increase our economic competitiveness, sustain our economic growth, and provide new opportunities for workers and entrepreneurs. Julie Holdren, President and CEO of the Olympus Group, told the Immigration Subcommittee that `For every H-1B worker I employ, I am able to hire ten more American workers.' A study for the Public Policy Institute of California by U.C. Berkeley Professor Annalee Saxenian bears this testimony out. It found that Chinese and Indian immigrant entrepreneurs in northern California alone were responsible for employing 58,000 people, with annual sales of nearly $17 billion.

Critics of the last H-1B visa increase have been proven spectacularly wrong, as the U.S. economy added 387,000 new jobs in January and the unemployment rate dropped to a 30-year low of 4 percent. Specialty jobs in the computer industry alone are projected to grow by 1.5 million between 1998 and 2008, according to the Department of Labor.

President Clinton's former chief economic advisor, Laura D'Andrea Tyson argues that `it's time to raise the cap on H-1B visas yet again and to provide room for further increases as warranted. Silicon Valley's experience reveals that the results will be more jobs and higher incomes for both Americans and immigrant workers.'

Mr. President, the final word should belong to Federal Reserve Chairman Alan Greenspan. At a Budget Committee hearing last month he was asked `Do you believe we should do something with our laws--immigration--that would allow high tech . . . labor to come into the country to ease the burden' on our labor force?

Chairman Greenspan responded: `I would certainly agree with that. It's clear that under existing circumstance . . . aggregate demand is putting very significant pressures on an ever-decreasing available supply of unemployed labor. The one obvious means that one can use to offset that is expanding the number of people we allow in, either generally or in a specifically focused area.'

By increasing the number of highly skilled professionals we allow to work in America, and providing additional funding for training and scholarships, we will create jobs for all Americans and keep our high-tech driven economic expansion on the move.