‘Hire American’ Provisions Frustrate Universities, Employers

'Hire American' provisions frustrate universities, employers

By Rob Hotakainen
The State (Columbia), May 3, 2009

Washington, DC — At Duke University in North Carolina, where foreign nationals account for 60 percent of this year's master's class in engineering, Vivek Wadhwa is watching his students struggle to get jobs.

Some are getting employment offers withdrawn, while others are frustrated and ready to move back home. Wadhwa says it is the result of xenophobic messages coming out of Washington.

The culprit is a law passed by Congress in February. It forces banks that receive federal bailout money to hire American citizens over foreign guest workers.

Two months later, its reverberations are being felt across the country, particularly on college campuses.

The effect could be most acute in states such as California and New Jersey, national leaders in immigrant-founded engineering and technology businesses.

In California, foreign nationals helped create more than half of the start-up companies in the Silicon Valley, according to a Duke University study. In 2007, foreign nationals accounted for nearly two-thirds of all engineering doctorates awarded from the University of California and California State University, the study found.

Overall, the numbers are small: Only 65,000 of the visas are permitted each year, and another 20,000 are allowed as exemptions if the applicants have graduate degrees from American universities.

Immigration lawyers and educators warn that it could become much more difficult for universities to recruit foreign students, particularly if students fear there will be no jobs for them after they graduate.

'They'll go to the U.K., or Australia, or Asia, or whatever it may be,' said Peter Roberts, a partner at McCarter & English, a corporate immigration law firm. 'It's going to be a disincentive for foreign nationals to come to the U.S.'

Wadhwa, an engineering professor at the Pratt School of Engineering at Duke and a researcher at the Harvard Law School, said it's part of a troubling pattern in the U.S.: 'Whenever there's a downturn, you start blaming foreigners.'

'This is making front-page news all across the world right now, much more than here,' he said. 'And the message it's sending to other countries is it's OK to raise trade barriers, it's OK to close your doors.'

Yet for Republican Sen. Charles Grassley of Iowa, who added the language to the stimulus bill, it was an easy call. With unemployment so high, he said, 'there is no need for companies to hire foreign guest workers' when there are qualified Americans who need jobs. His 'Buy American' amendment, which passed unanimously in the Senate, requires banks during the next two years to favor U.S. workers over any immigrant with an H-1B work visa.

While the language was added to the economic stimulus bill, it applies only to banks and other companies that receive money under the Troubled Asset Relief Program, the federal law that provides aid to struggling banks.

'If you're getting money from the TARP bill, you you've got to make sure that you make a good-faith effort to hire Americans first,' Grassley said in a speech on the Senate floor. 'And implied in it is if you're going to lay people off, you're going to lay off H-1B workers first before you lay off American workers.'

Illinois Democratic Sen. Dick Durbin, who backed Grassley's effort, said the H-1B program was intended to be used only when qualified American workers couldn't be found.

'Our immigration policy should seek to complement our U.S. work force, not replace it,' he said.