The Truth About Claims of a High-Tech Labor Shortage

No credible study has found a shortage.

  • The General Accounting Office, at the height of the worker shortage concerns in 1998, could not substantiate the claims of such a shortage.
  • Subsequent to its study of job vacancies, the Information Technology Association of America (ITAA) admitted in 1998 that the supposed shortfall had failed "to live up to its prior billing," and the high-tech industry laid off workers at four times the rate of other industries.

Plenty of workers are in the training and student pipelines.

  • There is already a shortfall of professional-level jobs for each year's new graduates. There are about 1.6 million students earning higher education degrees in the United States each year and over half a million graduates with 2-year degrees.
  • The Chairman of the House Immigration Subcommittee reports that the Department of Labor estimates that over the next few years there will be 138,000 job openings a year in information technology occupations. At the same time, 162,000 students are expected to graduate each year with associate, bachelor or graduate degrees in computer science, engineering, and mathematics.
  • Another Department of Labor forecast expects an increase in computer engineer jobs between 1996 and 2006 of 235,000. In addition there are projected to be 249,000 new jobs for database administrators and computer support specialists, and 520,000 new jobs for systems analysts. That is a total average increase of 100,000 per year, i.e. fewer jobs than the currently authorized number of H-1B foreign workers.

H-1B visas push out older American workers.

  • A Department of Commerce report in June 1999 noted very selective hiring practices of employers and indications of age discrimination in high-tech employment. The data did not sustain a finding that there is a shortage of high-tech workers.
  • Research by economic consultant and researcher Marc Bendick Jr., reported in the November issue of Journal of Aging and Social Policy, found that older workers encounter discrimination 41.2 percent of the time when they apply for jobs.

Wages offered to high-tech graduates do not show evidence of a shortage.

  • From 1996 to 1998, salary offers to high-tech graduates rose at about the same rates as those offered to graduates in the humanities: computer science up 19 percent, engineering technology up 16.4 percent, computer engineering up 16.9 percent, humanities up 17 percent.
  • A study last year by a Los-Angeles-based consulting group (Commercial Programming Systems, Inc.) found "Generally speaking, foreign workers get paid much less." The survey of 400 technology firms nationwide found that foreign workers are generally hired at one-third to one-half less than their U.S. counterparts.
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