Bloomberg News

Heartland Hungry for Engineers Beckons Foreign Graduates

July 18, 2012

Foreign-born engineers and scientists, long the prized recruits of companies in California’s Silicon Valley, are now increasingly finding a home in the U.S. Midwest.

A report released today by the Brookings Institution found that while the San Jose, California, metropolitan area still leads the nation in hiring skilled foreign workers on temporary visas, places such as Columbus, Indiana, and Bloomington, Illinois, are also becoming centers of activity for foreign-born employees hired under the H-1B program.

The study highlights the nation’s growing reliance upon workers from overseas to fill positions in science, technology and engineering. Just 4 percent of the world’s undergraduate degrees in engineering are awarded in the U.S., it said.

“The heartland is really looking for engineers,” Neil Ruiz, the study’s co-author and a senior policy analyst at the Brookings Metropolitan Policy Program, said in a telephone interview.

The study by the nonprofit Washington-based research organization focused on hiring patterns in 106 metropolitan areas under the H-1B program, which was created in 1990 to allow U.S. companies to hire foreign workers for three to six years while they seek permanent residency.

It found that demand for foreign workers was intense in smaller Midwestern metropolitan areas such as Fayetteville, Arkansas, which includes the corporate headquarters for Wal-Mart Stores Inc. (WMT:US)

Driving Demand

In Columbus, a metro area of 76,794 people about 45 miles south of Indianapolis, the demand was driven largely by Cummins Inc. (CMI:US), which designs, manufactures and services diesel and natural gas engines. Revenue grew to more than $18 billion last year from $5.7 billion in 2001, data compiled by Bloomberg show.

“About half of engineering graduates from U.S. colleges are from outside the U.S., so that’s really shaping our pool of employees,” said Janet Williams, a company spokeswoman. “We really need a wide range -- mechanical engineers, chemical engineers, electrical engineers.”

Demand for foreign-born workers has been strongest among technology companies. Microsoft Corp. (MSFT:US) led all employers in 2010- 2011, requesting an annual average of 4,109 H-1B workers.

The Redmond, Washington-based company was trailed by Tata Consultancy Services Ltd. (TCS), a Mumbai-based division of Tata Sons Ltd. that ranked No. 2 with an average of 3,179 requests a year. Deloitte Consulting LLP, a subsidiary of Arlington, Virginia- based Deloitte Touche Tohmatsu ILA Group Ltd., was third with an average 2,981 requests during the 10-year period.

Changing Cap

The number of H-1B visas available during the last decade has varied, with a cap of 195,000 from 2001 to 2003. The maximum was lowered in 2004 to 65,000, with another 20,000 positions allowed beginning in 2006 for foreign-born workers with graduate degrees earned at U.S. schools. The limit doesn’t apply to academic or research institutions.

The study found science, technology, engineering and mathematics disciplines accounted for 64 percent of all H-1B requests, even though they only made up 5.4 percent of U.S. employment in 2010.

The top areas of demand for H-1B visas generally track population. Employers in the New York metro area, the nation’s largest, requested an average of 52,921 foreign-born workers in 2010 and 2011, or 16.3 percent of the national average.

LA, DC

Companies in the Los Angeles area ranked second, with 18,048 average requests per year, or 5.5 percent of the total. The Washington, D.C., metro area ranked No. 5, with 14,569 average visa requests, about 4.5 percent of the national total.

Nationwide, there has been an average of 2.4 H-1B requests per 1,000 U.S. workers, Ruiz said. In San Jose, employers requested 17.1 H-1B workers for every 1,000 domestic employees. Columbus ranked No. 2, with 14.6 H-1B requests per 1,000 such workers; Durham-Chapel Hill, North Carolina, was third with 9.79; and Trenton, New Jersey, fourth with 8.46.

At Cummins, Williams said, H-1B workers total about 1,300, with 900 working at the company’s Columbus headquarters. The company has about 44,900 employees. She said a substantial amount of the company’s growth over the last decade has been fueled by environmental regulations that affect diesel engines.

The company prefers to hire workers directly from college to ensure they adopt its values, Williams said. The downside, she said, is that the small city may be more attractive to adults with families than 22-year-old college graduates.

“We call it ‘The Athens of the Prairie,”’ said Emily Foster, a Washington-based Cummins spokeswoman.

To contact the reporter on this story: Frank Bass in New York at fbass1@bloomberg.

To contact the editor responsible for this story: Flynn McRoberts in Chicago at fmcroberts1@bloomberg.net; Mark McQuillan in Washington at mmcquillan@bloomberg.net.


Toyota's Hydrogen Man
LIMITED-TIME OFFER SUBSCRIBE NOW

Companies Mentioned

  • WMT
    (Wal-Mart Stores Inc)
    • $85.16 USD
    • -0.78
    • -0.92%
  • CMI
    (Cummins Inc)
    • $143.06 USD
    • -0.94
    • -0.66%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus