"The fundamental motivation is cheap labor," Matloff said.
Young and Educated
Congress created the H-1B visa program in 1990 particularly to shore up hiring in science-related fields.
The annual cap on visas is 65,000, but has fluctuated over the years to as high as 195,000. People hired by universities and nonprofit organizations are exempt from the cap, as are 20,000 guest workers admitted each year who hold at least a master's degree from an American college or university.
The H-1B hires, recruited from overseas as well as from U.S. campuses, are well educated. Virtually all of them hold a bachelor's degree, and 42 percent also have a master's degree while 11 percent have earned a doctorate. They also are young. Of those whose visas were approved in fiscal 2011, 75 percent were under age 34. Forty percent were in their 20s or younger, according to the U.S. Citizenship and Immigration Services. Nearly 60 percent of applicants were from India. An additional 9 percent were from China and 3.5 percent from Canada.
Several hundred Washington employers rely on the visas, many of which hire just one foreigner. But others, including Amazon, T-Mobile, Expedia and Nordstrom, have dozens of H-1B workers on their payrolls.
Microsoft is among the nation's heaviest corporate users of H-1B visas, accounting for 10 percent of its U.S. workforce of 57,400. The company said it applied for an average of 850 visas each year between 2010 and 2011 for new employees on their first H-1B visa.
In addition to raising the visa cap, Microsoft wants Congress to free up 20,000 extra green cards a year so more temporary foreign hires could become permanent U.S. residents. Without a green card, visa holders can stay three years with a chance to renew for three more.
Though Congress conceived the H-1B visa program as a stopgap solution for select labor shortages, Microsoft routinely seeks permanent status for all its foreign employees in the United States. Jones said such policy attests to the quality of its hires.
In fiscal 2011, Microsoft sponsored more than 4,700 H-1B workers for green cards. But the company said 2011 was an aberration and that its green-card applications typically average about 2,000 a year.
In making the case for lifting the cap on visas, Microsoft notes the unemployment rate in computer-related occupations is below the 4 percent it says indicates full employment.
In addition, Americans are earning too few computer science and engineering degrees to keep pace with demand, while nearly half of graduate degrees awarded by U.S. schools in those fields go to foreign students. Smith earlier warned that if Microsoft can't bring foreigners to fill the jobs, the jobs would migrate to foreign countries.
Microsoft is pushing a two-prong solution for the federal government to raise $500 million a year by tacking an extra $10,000 fee for each newly created H-1B visa and $15,000 for each green card and use the money to bolster STEM education for Americans. But not everyone is convinced employers have exhausted the domestic hiring pool.
Ron Hira, associate professor of public policy at Rochester Institute of Technology, said computer and math occupations have not run out of American applicants. Unemployment rate for that sector has dipped to as low as 2.1 percent in 2007 -- below 3.4 percent currently.
A report earlier this month from the Economic Policy Institute, a nonpartisan think tank in Washington, D.C., accused Microsoft of exaggerating future worker shortages for computer-related occupations by implying that all such jobs require a computer-science degree. In reality, the report said, that's true for fewer than half of the current workers the field.
Peter Cappelli, an economist at the University of Pennsylvania, contends a labor shortage is a self-created problem by employers who won't make the investment needed to attract talent.
"What companies like Microsoft seem to want is employees with quite specific skills who don't need any training and ramp-up time," Cappelli said. "If you scour the world, you can find enough without having to train here" and paying higher wages.
Most Hires Not Advanced
A sense of Microsoft's foreign hires can be gleaned from an analysis of its fiscal 2011 green-card applications: 25 percent of them were in jobs classified by the Labor Department as entry level. Another 61 percent were one step up at Level II, including marketing managers or software engineers, handling "moderately complex tasks" requiring limited judgment.
And though the vast majority of Microsoft's visa workers held technical jobs, some were hired as a public relations manager, paralegal or graphic designer, the green-card data show.
Microsoft executives have said newly minted graduates command $100,000-plus salaries with signing bonuses. But a majority of its foreign workers actually earn below six figures, although a small fraction pull down $120,000 or more.
Jones contends the job labels are "misleading" because the Labor Department's definitions reflect experience, not skill levels. Someone classified as a legal assistant, the company said, may actually be a lawyer in his or her home country.
Nonetheless, even critics like Hira say the influx of educated foreigners can only benefit the U.S. economy. Studies have shown that as a group, H-1B workers are exceptionally entrepreneurial and inventive, accounting for disproportionate share of patents and startup firms.
And making their stay permanent, Hira said, would right the power imbalance between foreign nationals and companies that hold the temporary visas.
Jacob Kirkegaard, research fellow at the Peterson Institute for International Economics in Washington, D.C., said companies like Microsoft resort to foreign workers because it's expensive to leave jobs unfilled and have projects delayed when qualified Americans can't be had. H-1B visas, he said, are an expedient way to pick from an international crop of top graduates.
"They want people with the newest skills," Kirkegaard said. "If you came out of software development eight years ago, by definition you would know nothing about how to write programming for an iPhone app."
Jones, of Microsoft, said the company's focus is to cultivate future Microsofties at home. Investing in and reforming STEM education in the United States is a key part of that.
"If we can find American workers, that's always going to be our first choice," she said.
Seattle Times reporter Justin Mayo contributed to this report.
Distributed by MCT Information Services
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