Special report | Immigration

Own goal

America’s immigration rules are the opposite of what it needs

Getting ready to pay for Medicare, Medicaid and the rest

IN JANUARY, WITH less than a day’s notice, the mayor of Miami-Dade ordered the closure of the westbound lanes of Bear Cut Bridge, creating a disastrous bottleneck on the only route between downtown Miami and the posh island suburb of Key Biscayne. Engineers from Florida’s Department of Transportation (FDOT) had inspected the bridge last June and deemed it in need of repair but sound enough to remain in use for the time being. But by the time of the next inspection, in December, the corrosion of the steel girders supporting the bridge had accelerated alarmingly, rendering it unsafe. Local drivers now face a year of delays and taxpayers an unexpected repair bill.

In a damp, salty place like Florida, explains Andrea Sanchez, steel and concrete can decay extremely quickly. She should know: while pursuing a doctorate in civil engineering at the University of South Florida she is working on a project funded by FDOT to model the lifespan of reinforced concrete in bridges exposed to sea air. With luck, her work will keep Florida’s drivers safer and more punctual and the state’s coffers fuller. But she will probably not be around to see the results.

Ms Sanchez is Venezuelan, living in America on a student visa. She would like to stay on after she completes her doctorate next year, but will have to leave unless she can find a firm that is willing to put up with the hassle and expense of obtaining a new visa for her. So far, she has found that difficult. At job fairs, as soon as she explains that she is not a citizen or permanent resident, most companies lose interest.

That is understandable. To employ a foreigner, even on a temporary basis, a firm must file paperwork with the Department of Labour certifying that no American workers are being displaced and that a market wage will be paid (to avoid depressing Americans’ earnings). Once that is approved, the prospective employer must submit evidence of the applicant’s qualifications to the Department of Homeland Security, along with $1,575-5,550 in fees, depending on the size of the company and the urgency of the application. Everything is then passed on to the State Department, which interviews the applicant and checks the other bureaucrats’ handiwork.

Even for companies willing to jump through all these hoops, visas may not be available, as Congress has put a limit on the number that can be issued each year. All 85,000 short-term visas for skilled foreign workers (H-1Bs, in bureaucratese) on offer this year were snapped up within ten weeks. That was a lot better than in April 2007, when the limit was reached in less than a day. Even in the depths of the downturn the quota was always fully used. Indeed, demand has exceeded supply every year since 2003, when Congress slashed the number of visas on offer by two-thirds.

Like gold dust

Workers seeking a residence permit, or “green card”, which allows an indefinite stay and opens up the prospect of eventual citizenship, have an even tougher time. Over 1m green cards are issued each year, but the bulk of them—65% in 2011—go to relatives of existing citizens and residents. Refugees and asylum-seekers receive another 16%. The number of green cards tied to employment and investment is limited to 140,000 a year, or roughly 13% of the current total. The quota has remained the same since 1990, even as America’s population has grown by 60m or so. Moreover, it includes visas for members of the beneficiaries’ families, who normally use up about half the slots on offer. So in 2011 America admitted only 65,668 new permanent residents for hard-nosed economic reasons, a mere 6% of all the green cards handed out.

Not content with merely rationing employment-based green cards, the government also makes them expensive and onerous to obtain. As with other work visas, employers must first show that they have tried and failed to find a suitable American for the post. The Department of Labour has strict rules about how, and for how long, this should be done. It demands two advertisements in the Sunday print edition of the largest local newspaper, for example (online advertisements will not do), along with various other recruitment efforts spread out over a month. Next, the employer has to convince the Department of Homeland Security that it has the wherewithal to pay the applicant indefinitely. A second, overlapping set of quotas which applies only to immigrants from countries that account for a high proportion of visas, including India, China and the Philippines, further complicates matters and can lead to years of delays. Lots of audits and inspections of all this add another layer of frustration and expense. A firm can easily spend $10,000 on immigration consultants and lawyers for a single application, along with around $1,500 in fees. Any mistake carries a risk of big penalties.

Worse, it is almost impossible for people like Ms Sanchez, with no formal job offer but with valuable skills, to obtain a visa, temporary or permanent. (Much the same goes for entrepreneurs, even if they already employ people in America, unless they are ready to invest at least $500,000.) This makes no sense to Ms Sanchez. She has already proved through her work for FDOT that her skills are in demand. If she does have to leave, she will put them to work in some other economy instead of America’s. “I pay my taxes. All my paperwork is in order. I’m bringing something to the community. I don’t see why it should be so hard,” she says.

Fred Young, the boss of Forest City Gear, agrees. His firm, which makes gears for NASA’s Mars rovers, among other whizz-bang devices, needs more staff, but struggles to find enough qualified Americans. Workers with an advanced degree in science, technology, engineering or mathematics (STEM) are much in demand. Only 3% of them are unemployed, compared with 7.9% of workers in general. Among some STEM professionals, such as nuclear engineers, computer-network architects and petroleum engineers, there is virtually no unemployment. According to a projection from Georgetown University’s Centre on Education and the Workforce, between 2008 and 2018 America will create 779,000 jobs requiring a graduate degree in a STEM field. Yet on current trends only 550,000 native-born Americans will be earning such degrees over that period, leaving firms no choice but to turn to immigrants.

That would be no bad thing. A 2011 study conducted on behalf of the Partnership for a New American Economy, which favours looser immigration rules, found that employment among native-born Americans increased by 262 jobs for every 100 foreign-born workers admitted with advanced STEM degrees from American universities. For every 100 H-1B visas, 183 Americans found jobs. Employing foreigners with any sort of advanced degree had a similar, albeit smaller, effect. And such foreigners on average paid about ten times more in taxes than they received in government benefits.

On the whole, though, immigrants are not STEM whizzes. In fact, they are four times less likely to have finished high school than the average person born in America. But immigrants of all sorts still bolster the economy. They are more likely to be working than the native-born, accounting for just 13% of the population but 16% of the workforce. They are also more likely to apply for a patent or to start a company. One study found that 18% of America’s biggest companies were founded by immigrants and a further 23% by the children of immigrants.

Most immigrants are not, over the course of their lives, a burden on the state. They are much less likely than the native-born to go to jail. In 2007 a CBO study reckoned that regularising the status of America’s millions of illegal immigrants—the least skilled of all—would bring in an extra $48 billion in revenue over ten years and increase government spending by only $23 billion. Most studies suggest that more immigration would increase aggregate incomes of those already in the country, although they differ on the effect on low-skilled workers.

Immigrants are also saving America from demographic decline, and thus putting off the day when Medicare and Social Security become entirely unaffordable. Jeffrey Passel and D’Vera Cohn of the Pew Research Centre, a research institute, have calculated that immigrants will account for 82% of all population growth between 2005 and 2050, and for all the growth in the working-age population over the same period.

An 11m-strong queue

The arguments are beginning to sink in even in Washington. Of all the items on Mr Obama’s legislative agenda, immigration reform seems the most likely candidate for a bipartisan compromise. The president has proposed handing out green cards to foreign STEM graduates at American universities and offering a “pathway to citizenship” to the 11m-odd illegal immigrants. Various proposals in Congress support these goals, along with a simpler system for admitting temporary workers.

The hitch is that many Republicans consider any measure that might allow illegal immigrants to become citizens as tantamount to an amnesty that rewards unrepentant criminals, no matter how long the wait or stringent the conditions. Moreover, they argue, such a reform would simply encourage more hopefuls to attempt illegal crossings. Many Democrats, meanwhile, seem to view an increase in visas for skilled workers as a bargaining chip for a reprieve for illegal immigrants, rather than as an end in itself.

As it happens, change is already afoot, even without Congress’s blessing. Illegal crossings from Mexico to the United States have slowed to a trickle and more people are leaving than coming in because of the weak economy. At the same time immigrants are becoming increasingly well-educated. Back in 1980, 40% of immigrants of working age had not completed high school; in 2010 the share of dropouts had fallen to 28%. In 1980 only 19% of those immigrants had a university degree; in 2009, 30% did, and 2% had doctorates, compared with just over 1% of native-born Americans.

Immigrants’ greater educational attainment is due in part to the efforts of successive administrations to make it easier for people like Ms Sanchez to negotiate the visa system. Foreign university students with an offer of employment in a related field have long been allowed to stay and work for a year after completing their degree, under a programme called “Optional Practical Training”. In 2008, under Mr Bush’s watch, the government extended the permissible stay for STEM graduates to two-and-a-half years. Last year, under Mr Obama’s, the rules were loosened yet further.Mr Obama also temporarily allowed otherwise law-abiding illegal immigrants brought to America as children to stay and work in the country. That will let some 1.7m people live much more productive lives for now—although only Congress can make their reprieve permanent.

Likewise, Congress needs to take action to procure a systematic improvement in America’s infrastructure. But until it gets round to it, creative officials up and down the country are finding ways of making up for its neglect.

This article appeared in the Special report section of the print edition under the headline "Own goal"

The America that works

From the March 16th 2013 edition

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