On March 13th, 2013, President Obama met with business leaders to present his plan for immigration reform to “attract and retain the best and brightest students from around the world to help ensure the next great breakthroughs in technology and medicine are developed right here in the United States”, said the White House.
Participants to this discussion included numerous CEOs such as Virginia Rometty of IBM Corporation, Omar Ishrak of Medtronic, Doug Oberhelman of Caterpillar, George Barrett of Cardinal Health, Greg Brown of Motorola Solutions, Ed Rust of State Farm, Cecilia Muñoz, Director of the Domestic Policy Center, and Gene Sperling, Director of the National Economic Council.
The White House’s document “Immigration’s Role in Building a Strong American Economy” explains how immigration reform would help foreigners increase the GDP in the US.
The President’s “Startup Visa” for immigrant entrepreneurs would help employers hire the right foreign employees for the required positions, by cutting red tape and eliminating the enormous backlog that exists today for employment sponsored green cards.
Since the Immigration Act of 1990, only 140,000 employment sponsored green cards have been available every year, with a limit of 7% from each country. This has developed years of backlogs and a severe shortage of skilled workers in vital areas such as high technology, health care, finance, manufacturing, and pharmaceutics.
Why do US companies require foreign workers?
According to Immigration Works USA, the most important reason is the aging US population. 75 million baby boomers retired in 2012, and fertility rates among American women dropped below replacement levels. Foreign population in the US is younger than the average US population, and most is therefore of working age. According to Pew Research “…virtually all of the growth of the nation’s working-age population between now and 2050 will be accounted for by immigrants and their U.S-born children”
The National Survey of College Graduates states that skilled immigrants innovate as scientists and engineers, develop cutting-edge technologies and companies, and today represent over 50% of PhDs working in math, engineering, and computer science projects.
There is also the fact that even during a recession, unskilled US workers, including high school dropouts, are unwilling to take low-paying unskilled jobs. After events such as the recent economic downturn in the US, companies can only raise salaries by so much, at the risk of losing their competitiveness in the new global environment.
Immigrants today represent 16% of the total workforce in the US in key areas such as construction, food services, and IT. In fact, foreign workers generated a third of the increase of patents registered in the nineties.
Also, more than 40% of Fortune 500 companies have been established by immigrants or first-generation Americans (children of immigrants). These companies provide employment to over 10 million people around the world, and generate income in the amount of $4.2 trillion. On the other hand, small foreign-owned businesses in the US generate $776 billion per annum, and provide employment to approximately 4.7 million people in this country.
President Obama’s plan for immigration reform would drastically reduce the undocumented population, without causing a shortage in the number of foreign workers required by companies in the US.