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Tuesday, July 23, 2013

Big Data Analysis Adds to Guest Worker Debate

SAN FRANCISCO â€" Although certain kinds of engineers are in short supply in the United States, plenty of potential candidates exist for thousands of positions for which companies want to import guest workers, according to an analysis of three million résumés of job seekers in the United States.

The numbers, prepared by a company called Bright, which collects résumés and uses big data tools to connect job seekers with openings, enter a contentious debate over whether tech companies should be allowed to expand their rolls of guest workers. In lobbying Congress for more of these temporary visas, called H-1B visas, the technology industry argues there are not enough qualified Americans. Its critics, including labor groups, say bringing in guest workers is a way to depress wages in the industry.

Many economists take issue with the industry’s argument, too. One side points out that wages have not gone up across the board for engineers, suggesting that there is no stark labor shortage. Another counters that unemployment rates in the sector are minuscule and that in any event, H-1B workers represent a tiny fraction of the American work force.

“I didn’t expect this result,” said Steve Goodman, Bright’s chief executive.

Bright is based in San Francisco, and it makes money in part by placing qualified candidates with recruiters and, according to Mr. Goodman, employs workers using H-1B visas. “We’re Silicon Valley people, we just assumed the shortage was true,” Mr. Goodman said. “It turns out there is a little Silicon Valley groupthink going on about this, though it’s not comfortable to say that.”

For a few job categories, like computer systems analysts, there are relatively few “good fits” among American applicants, Bright found. Computer systems analyst jobs, considered relatively low-skilled in the tech world, had four openings for every American candidate. For others, like high-skilled computer programmers, there were more than enough potential candidates in the United States, the company found.

Bright’s study is unlikely to end the debate, partly because it rests on the company’s proprietary algorithm to determine who is a “good fit” for a particular job opening. Its algorithm uses a range of criteria, including work experience and education, but also work descriptions that indicated a high likelihood of other skills. Its analysis also doesn’t specify how many job openings there are at a particular point in time, or whether they are sufficient to accommodate both American engineers and foreign guest workers.

Lawrence Katz, an economist at Harvard, said that while the tech industry’s claims of a labor shortage may be overblown, the argument over expanding temporary work visas should not be made on the basis of whether there are shortages at one point in time. He said the data from Bright were useful in showing that there was most likely not “a huge mismatch” in the demand and supply of computer professionals, except perhaps in certain job categories like computer systems analysts.

“But they don’t help us determine whether the U.S. economy would benefit from an expansion of the H1-B visa program or what the impact would be on U.S. workers in these occupations,” he said. “The case for and against expanding the H1-B visa program should be done on an overall assessment of the impact on the U.S. economy (workers, consumers, investors, students/future workers) and not only on whether there are short-run ‘shortages’ in any specific occupation.”

For the study, Bright looked at the job categories for which firms applied for H-1B visas, and then, looked at résumés of job seekers in the United States whose résumés matched those same categories.

Giovanni Peri, an economist at University of California, Davis, said that the Bright study was insufficient to determine whether there was a need for foreign engineers. “It is the difference between job vacancies (demand) and unemployed with right qualifications (supply) that provides a measure of the excess (or not) of demand,” he said. “Knowing only the number of unemployed with right qualifications does not do it.”

“There are many more job openings” where companies do not file for H-1Bs, but search for candidates on the domestic job market, he added.

The Senate immigration bill, passed last month, nearly doubles the number of H-1B visas that companies can seek every year. Industry lobbied heavily for it, bulldozing efforts to add language that would force companies to try to hire an equally qualified American first. The House is mired in arguments over what kind of immigration legislation it can pass. Technology industry groups are lobbying members of the House for a substantial increase in H-1Bs, among other things.

Outsourcing companies, mostly from India, have lately sought the largest chunks of H-1B visas. Companies like Tata Consultancy Services and Wipro bring thousands of temporary workers, mostly from India, and place them for short-term projects in a variety of American industries, from banks to technology firms like Microsoft and Oracle. H-1B visas are also used by graduates of American universities who are hired by companies in the United States.

Bright’s analysis suggests a hierarchy in the industry that mirrors what has long been said about jobs like low-skilled agricultural or restaurant work: Americans could do these jobs, but are unlikely to accept the pay or conditions. As a result, the jobs are taken by immigrants.

The age of workers, which the study did not look at, may also play a role. Experienced American workers tend to be older in an industry that prizes youth. A study conducted by a Seattle-based company called Payscale found that among 32 technology companies surveyed, only six had a work force with a median age over 35. At Monster, the job search portal, the median age was 30; at Google, 29; and at Facebook, 28. The median age of American workers over all is 42.3 years old, according to the Bureau of Labor Statistics.

As if to underline the study’s findings, Mr. Goodman spoke from a conference room that looked out on decorated ping-pong tables, a liquor bar and tiki-themed snacks. Later that day, Bright was having a party, partly to attract new talent, he said, including foreign programmers here on H-1B visas.