Foreign competiton has arrived at the highest job skill levels

Dan McSwain writes an intriguing article in the San Diego Union Tribune entitled, Foreign competitors in the next cubicle.

San Diegans already know full well that foreigners are competing for their jobs. They don’t need national politicians from Donald Trump to Bernie Sanders telling them to worry.

Consider the recent blowback from layoff decisions of two prominent regional companies, Qualcomm and Southern California Edison.

The layoffs highlighted a controversial corner of immigration policy occupied by H-1B visas, which allow companies to hire foreign workers for up to six years in “specialty” occupations such as software, engineering, biotech or even fashion modeling.

Early this year, Edison began displacing about 500 information technology workers, about 100 voluntarily and 400 through layoffs. But their functions were outsourced to Infosys and Tata Consultancy Services, two giant firms based in India.

Before they left, some workers were compelled to train their replacements, and some of them were foreign nationals working in the U.S.

The H-1B program “was supposed to be for projects and jobs that American workers could not fill,” one Edison worker told Computerworld, an IT news magazine. “But we’re doing our job. It’s not like they are bringing in these guys for new positions that nobody can fill. Not one of these jobs being filled by India was a job that an Edison employee wasn’t already performing.”

In response, 10 federal lawmakers asked the Department of Labor to investigate whether the H-1B program can be used to directly replace American workers. As of June, that probe was under way, according to Sens. Jeff Sessions, R-Ala., and Dick Durbin, D-Ill.

Indirect replacement is no better, if you’re the one losing a job.

Last month, Qualcomm said it would cut roughly 15 percent of its global workforce, about 4,700 workers (it employs 15,000 in San Diego; 31,000 worldwide). Executives haven’t released any details, yet the news lit up social media.

“There are large, multistory apartment complexes in Kearny Mesa and Clairemont Mesa full of Qualcomm engineers from India,” said Gail Anderson, a commentator on the Union-Tribune’s digital editions. “I’d say send them all back.”

The H-1B program for temporary workers is clearly popular with employers. Federal officials in April received a record 233,000 applications, or nearly four times this year’s tech slots.

Criticism of the program comes from two directions: Many H-1B workers don’t become U.S. citizens, so hiring them ultimately transfers skills to foreign competitors.
Some pay lower wages

Meanwhile, they tend to depress wages. Regulations call for equivalent pay, but employers often use loopholes to pay at the low end of industry scales.

Others sympathize with foreign workers, saying the program amounts to indenturement because the visas belong to employers. Workers who lose jobs generally must leave the country. Such leverage adds potential for abuse.

…Canada famously uses a point system that favors people with job offers and advanced degrees. The U.S. sticks to favoring family reunification, and doesn’t focus on skills.

In San Diego, the issue is far from academic. Recent immigrants long ago came to dominate low-wage jobs in hospitality, farming and landscaping. Then they moved into middle-wage jobs in construction and manufacturing.

Now natives increasingly encounter competition from young, hungry recent graduates in professional and technical services, a sector that has added a net 24,300 jobs since 2009 in San Diego County.

Just as certainly, talented foreigners have played key roles in powering economic and technical achievement in San Diego.
Focus on innovation

At Achates Power, a startup that has invented a dramatically cleaner and more-efficient diesel engine, 10 percent of its 50 workers used H-1B visas and about one-third were born abroad, the Union-Tribune reported in 2013.

It’s easy to see why Congress is reluctant to discourage such innovation on U.S. soil. With the American economy gaining strength as the rest of the world slumps, global competition will only grow in ferocity.

Regardless of where talk of national reform ends up, the emotional power of the immigration issue seems unlikely to diminish.

For decades, workers have watched jobs disappear to foreign competitors inside and outside the U.S. And for years, pundits and politicians said boosting skills offered a path to job security.

Reality is more complex. Competition has arrived at the highest skill levels.
Read more here.

H/T 90 Miles from Tyranny