Make America Great Again—Invest in High-Skilled Immigrants - Pacific Standard

Make America Great Again—Invest in High-Skilled Immigrants

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What Donald Trump and the GOP get wrong about STEM guest workers.

By Jared Keller

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(Photo: Andrew Hoyer/Flickr)

Are foreign workers coming to United States to steal the best jobs from hard-working Americans? Absolutely — and new research shows it’s quite good for the country.

A new working paper published by the National Bureau of Economic Research finds that it’s high-skilled immigrants who are fueling the growth of the science, technology, engineering and mathematics (STEM) sector, a crucial engine for U.S. immigration. In their analysis, economists Gordon H. Hanson and Matthew J. Slaughter found that foreign-born workers currently account for a “disproportionate” share of specialists in the STEM fields, despite the relatively limited numbers of employee-sponsored (140,000) and H-1B (85,000) visas available to skilled workers within the current immigration system.

(Chart: National Bureau of Economic Research)

According to data compiled by the NBER (and charted to the left), the number of foreign workers with university degrees in STEM occupations has been on the rise since 1993.

The influx of high-skilled immigrants into STEM fields is largely to thank for America’s modern prowess in the global technology sector, despite the relatively paltry share of STEM jobs in total employment (6 percent in 2012, up from 5 percent during the 2001 dot-com bust).

“Recent work finds evidence consistent with high-skilled immigration having contributing to advances in U.S. innovation,” Hanson and Slaughter observe. “U.S. states and localities that attract more high-skilled foreign labor see faster rates of growth in labor productivity…. Metropolitan areas that historically employed more H-1B workers enjoyed larger bumps in patenting when Congress temporarily expanded the program between 1999 and 2003.”

We can partially attribute the dominance of foreign-born workers in STEM fields to education. American secondary students ranked below other high-income countries in math and science (36th and 28th, respectively, in the 2012 Program for International Student Assessment exam), and U.S. institutions of higher education that dominate global rankings in medical science and engineering tend to explicitly attract foreign talent from abroad to bolster their reputations. But Hanson and Slaughter argue that it’s primarily increased specialization among foreign-born workers, the skills and expertise signaled by an advanced degree, that tend to catch the eye of employers. While American workers may not be at a comparative disadvantage in math and science compared to foreign-born ones, universities and immigrations programs like the H-1B visa implicitly screen for the best and brightest the world has to offer.

“U.S. states and localities that attract more high-skilled foreign labor see faster rates of growth in labor productivity.”

This leads to the main argument against foreign-born STEM workers, which echoes decades of broad immigration fears: Foreign workers will take American jobs because they’re cheaper. This is the logic underpinning Republican presidential nominees Donald Trump’s position on H-1B visas: By raising the prevailing wage paid as part of the visa program and requiring the recruitment of domestic workers, the U.S. can ostensibly remove incentives for businesses to focus on cheaper foreign labor. This position is a pivot from Trump’s flexibility on guest workers back in March, when he declared “we need highly skilled people in this country, and if we can’t do it, we’ll get them in.” Trump quickly reversed his stance amid criticism from Republican lawmakers: “The H-1B program is neither high-skilled nor immigration: These are temporary foreign workers, imported from abroad, for the explicit purpose of substituting for American workers at lower pay.”

(Graph: United States Census)

Here’s the rub: Foreign-born STEM workers aren’t necessarily cheaper than their American counterparts. According to Hanson and Slaughter’s analysis, average annual earnings about male, full-time STEM workers between the ages of 25 and 44 have gradually exceeded those of native-born workers since the rise of the H1-B visa program in the 1990s. Foreign-born STEM workers aren’t sucking up American jobs because they’re cheaper — they’re doing so because they’re better.

While foreign-born workers tend to earn less than native counterparts in non-STEM jobs, even if they have advanced degrees, it’s those highly skilled science and technology workers who poke a hole in the stereotype of cheap foreign labor. “In the press, it is entry-level programmers from abroad admitted under H1-B visas who by foreign outsourcing shops who draw much of the attention,” Hanson and Slaughter write. “In the data, what catches the eye is the strong and rising presence of foreign-born master’s and doctorate-degree holders in STEM fields, whose training, occupational status, and earnings put them in the highest rungs of the U.S. skill and wage distributions.”

It’s unlikely that this stereotype will fade anytime soon, and not just because of the threads of xenophobia and protectionism running through the presidential race: Hanson and Slaughter note that rising immigration hasn’t led to a proportional expansion in the share of total employment in STEM occupations. But for a nation that’s focused on maintaining its dominance in technological and scientific innovation, throwing out highly skilled immigrants under the nativistic “America First” impulse will only stymie growth in the nation’s major economic centers. Take it from the 150 Silicon Valley leaders who, in July, signed a letter declaring the prospect of a Trump presidency “a disaster of innovation”: Excluding the world’s best and brightest from modern industry is not the way to make America great again.

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