Gates in D.C.: Expect Visa Talk

During the Microsoft chairman's Mar. 12 visit to Congress, all ears will be tuned to any exchange about H-1B caps and U.S. jobs

Win McNamee/Getty Images

by Jay Greene

Microsoft (MSFT) Chairman Bill Gates is scheduled to help celebrate the 50th anniversary of the U.S. House Committee on Science & Technology on Mar. 12. But after exchanging pleasantries and highlighting the need for education reform, Gates is likely to field questions about Microsoft's views on a different but related topic: immigration.

It's not that the committee has jurisdiction over immigration, but for Gates there's an inextricable link between U.S. technology competitiveness and the country's policies on foreign workers. Gates has consistently pressed Congress (BusinessWeek.com, 3/8/07) to increase the cap on so-called H-1B visas, which are issued to skilled workers from foreign countries. Easing the restrictions, say Gates and his counterparts at other leading tech companies, including Cisco Systems (CSCO), would provide a bigger pool of would-be workers.

Currently, the government issues 65,000 of the visas each year, a number many companies argue is so low they can't hire enough worldwide talent. Microsoft says the cap prevented roughly 300 job candidates last year from taking posts at its Redmond (Wash.) headquarters. Opponents say lifting the cap would take jobs from U.S. workers.

A Canadian Refuge

To sidestep the cap, Microsoft opened something of a refugee camp in Richmond, B.C., about two hours north of Redmond. That's where the Microsoft Canada Development Centre opened in September (BusinessWeek.com, 1/17/08). Roughly 100 of the workers there were unable to get an H-1B visa. So they're working in the same time zone as their Redmond counterparts while taking advantage of Canada's more liberal immigration policies and the city's proximity to Seattle.

While Gates isn't expected to talk about the Richmond site in his prepared comments, he may get questions about it from legislators who believe Microsoft is using the center to export jobs they say should be given to U.S. workers.

None of that would deter Gates from pushing to increase the cap. "Bill will make the fundamental point we've been making, and that's that there's a severe skills gap that U.S. businesses are facing," says Jack Krumholtz, Microsoft's managing director for federal government affairs. And Gates is likely to encourage lawmakers to create a "streamlined path to permanent residency for people with certain skill sets," Krumholtz adds.

The Committee on Science & Technology is well-versed in debates over foreign workers and their impact on U.S. competitiveness. "Where there is an appetite for a discussion on H-1B visas, it revolves around the issue of U.S. competitiveness," says Louis Finkel, the committee's director of policy and outreach. Representative Dana Rohrabacher (R-Calif.) has co-authored legislation to tighten some loopholes in the H-1B program. As BusinessWeek first reported in February, 2007, the biggest beneficiaries of the H-1B program appear to be Indian outsourcing firms (BusinessWeek.com, 2/8/07), which often hire workers from India to train in the U.S. before returning home to work.

What New Laws Might Do

In the 12 months that ended in September, six of the top 10 visa-recipient companies were based in India. Two others, Cognizant Technology Solutions (CTSH) and UST Global, are U.S.-headquartered companies with most of their operations in India (BusinessWeek.com, 3/6/08).

The bill backed by Rohrabacher would require employers to make sure their hiring of workers with H-1B visas doesn't displace U.S. workers, among other mandates. It does not expand the program, as Gates has urged. Rohrabacher intends to question Gates on the issue, according to his spokeswoman, Tara Olivia Setmayer.

Two others on the committee, Representative David Wu (D-Ore.) and Representative Mark Udall (D-Colo.), have authored legislation to expand the cap by 65,000 to workers who have obtained master's or PhD degrees. The bill would require employers of those workers to fund scholarships at undergraduate and postgraduate schools. A spokeswoman for Wu says the congressman doesn't plan to ask Gates any questions on the matter, while a spokeswoman for Udall expects the matter to come up, though she wouldn't say if Udall will press the issue. "What Gates is proposing is a poor fix because it harms American workers in a significant way," says Ron Hira, an assistant professor of public policy at Rochester Institute of Technology.

Although the H-1B debate will be only a small piece of Gates' testimony, it may be the most riveting.

Greene is BusinessWeek's Seattle bureau chief.