Work Visas: Lose the Lottery

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Big-Company Bias

Then there's the matter of students. There are more than 250,000 foreign students studying in our universities. In our engineering schools, 60% of PhDs and 42% of master's candidates are foreign nationals. These students are often the best of their home countries. But there are only 20,000 H-1B visas available for graduates at the master's level and above. And there were 31,200 applications for these visas. Bachelor's-level graduates don't get a special allocation—they need to compete in the general pool, which has 65,000 visas available.

Instead of a lottery deciding who gets to stay, Berry says, these visas should be allocated based on school and student ranking. And he suggests giving preference in the general visa pool to engineering and science graduates from American universities.

The downside here is that we may leave out some of the most promising students who graduate from lower-ranked schools. School ranking doesn't always translate into career or entrepreneurial success (BusinessWeek.com, 8/31/07).

The disadvantage of the guild's proposal that visas be granted to the highest-paid employees is that it would favor those working for big companies who have the most experience. It would disadvantage startup tech companies that can't afford to pay high salaries and hire the most experienced workers (BusinessWeek.com, 1/15/08).

Bring Workers to Stay

There is no perfect system, but I believe that allocating visas based on skill and giving preference to the graduates of American schools would solve some of the most urgent problems with the H-1B program. It would reduce the salary distortion and provide a way for corporations to increase their odds of getting who they really want.

The lasting solutions lie in bringing in highly skilled immigrants on permanent resident visas instead of these temporary visas. My research at Duke University has shown how skilled immigrants boost the economy and create jobs. After surveying more than 2,000 tech companies from 1995-2005, we learned that 25.3% of all companies started nationwide and 52% of those started in Silicon Valley had immigrants as founders (BusinessWeek.com, 1/3/07). In 2005, these companies generated $52 billion in revenue. And they employed 450,000 workers—which is greater than the number of engineers and scientists we admitted in that 10-year time frame.

H-1B holders can't start companies and can only stay up to six years. If they do decide to become permanent residents, they face long delays in visa processing, especially if they come from the most populous countries. The immigration department is currently processing visas for those Indians and Chinese who filed applications in 2001. Once these workers have filed for permanent residence, they can't change employers or even be promoted to a different job in the same company—or they have to restart the application process and move to the back of the line. Their spouses aren't allowed to work or obtain Social Security numbers—which are usually needed for things like driver's licenses and bank accounts. And these workers can't lay deep roots in American society because of the uncertainty about their future.

That is why we need to be selective in the skills we import, and once we bring these workers here, we bring them to stay. We also want a level playing field for American workers to compete with foreign workers. And we want these immigrants starting companies and creating jobs. Ultimately we need a major overhaul of the temporary work visa system, but short-term fixes are a good place to start.

Vivek Wadhwa, a former tech entrepreneur, is the Wertheim Fellow at the Harvard Law School and an executive-in-residence at Duke University. He writes a column on policy issues affecting entrepreneurs every month.