Opinion: America’s big mistake in the war for high-tech talent

Editor’s Note: Steve Case, a co-founder of America Online, is chairman and chief executive of Revolution, a Washington, DC-based venture capital firm, and author of “The Rise of the Rest: How Entrepreneurs in Surprising Places Are Building the New American Dream.” The opinions expressed in this commentary are his own. View more opinion on CNN.

It’s a classic case of the left hand not knowing what the right is doing. After making a substantial investment in the industries of tomorrow — the recently passed CHIPS and Science Act provides $39 billion for companies establishing plants for semiconductors and other sophisticated products in the US — the government now is leaving many of the very workers required to staff those new facilities at risk of deportation. What we’re doing is counterproductive, yet here we are.

Even amid the fallout from Silicon Valley Bank’s recent failure and layoffs at some of the largest tech companies, America’s high-tech sector is still growing. In fact, the sector is poised now to create so many jobs over the next decade that the domestic supply of scientists and engineers won’t suffice.

Already, some 40% of software engineers working here are born outside the US, according to Bloomberg News, and many positions remain unfilled. Deloitte predicts that within seven years the United States will need upward of 1 million additional skilled workers in the semiconductor industry alone. Yes, some of the big-tech companies are cutting back, but startups in rapidly expanding sectors such as artificial intelligence, decarbonization, advanced manufacturing and health care are greatly in need of talent to expand.

But there’s a hang-up. The exact percentage is unknown, but according to the Society for Human Resource Management, experts estimate 10% to 30% of workers let go in recent rounds of cutbacks had come to the United States on the special H-1B visas reserved for highly skilled workers. Despite calls for a new extended grace period, federal rules require laid-off workers holding H-1B visas to find alternative employers within 60 days or else lose their status and be forced to leave the country. Most are eager to stay, but the government requires companies claiming H-1B talent to jump through hoops that are expensive, arduous and slow-moving.

Many of these workers have lived in the US for years and become pillars of their communities. They may eventually found companies of their own. But they are now at risk of having to leave the country.

This is unfortunate for a number of reasons. First, it highlights the degree to which American universities are struggling to meet the private sector’s demand for scientists and engineers. American schools still enroll fewer than 100,000 graduate students in electrical engineering and computer science programs annually, according to Deloitte. And yet, even with a cap of 85,000 H-1B visas, positions around the country remain open.

Speak to entrepreneurs anywhere, but particularly those based outside the traditional tech hub footprints of Silicon Valley, Boston and New York City, and you’ll quickly realize that talent acquisition is the most significant barrier to growth. And yet rather than directing scientists and engineers born outside the US to promising startups, Washington’s inaction sends them to other countries — likely to join companies that then compete with American firms.

Second, our current predicament marks a failure of American imagination. Some may presume that sending these professionals away will help American workers — but that’s not the case. For one, according to economist Enrico Moretti, growing tech businesses provide advantages for a whole range of workers. Every tech job creates five other jobs in the community — homebuilders, restaurant employees and more. But a company constrained by its inability to hire engineers won’t be able to grow — and that will limit the job opportunities in those communities.

Finally, and most abjectly, today’s potential deportations mark a profound failure of our politics. For years, those of us who believe that economic growth is the key to America’s continued prosperity have lobbied Washington both for more STEM education and for additional H-1B visas. But the limit has remained unchanged at 85,000 visas per year because proposals to lift the cap — which members of both parties support — have been tied to proposals for more expansive immigration reform, and that broader debate remains mired in political gridlock.

Just as frustrating, H-1B visa holders who fail to qualify for a green card are required to leave after six years in the country. But the backlog of green card applications is long, with a record high of 1.2 million H1-B holders pending in 2020 and wait times that rose by 50% between fiscal 2017 and fiscal 2021. As a result, our leaders are sending an unfortunate message to the world’s entrepreneurs: Better to found your companies elsewhere.

Fortunately, more limited efforts are afoot to retain those currently at risk for deportation. Chicago, for example, has established a kind of local matchmaking service, identifying local companies eager to hire tech workers. At the outset, the job website listed 900 opportunities at companies willing to accept the rigmarole of sponsoring a worker’s visa.

Of course, even if there’s a match, an H-1B worker living in Seattle would have to relocate the entire family to the Windy City. But that’s preferable to what other companies are choosing to do — namely shift their operations overseas. Canada and Australia have already created more entrepreneur-friendly systems. One company I recently encountered in Los Angeles decided to situate a recently hired chief product officer in Vancouver, British Columbia, to avoid the frenzied panic now woven into the American immigration experience.

If we’re in a global competition for technological supremacy, we need, first, to avoid defeating ourselves. We undoubtedly need the manufacturing facilities the federal government is now helping to support. But that investment will be severely undermined if we don’t train and acquire the talent required to keep those plants humming.

At a moment when nearly 70% of Americans support welcoming more skilled immigrants into the country, Washington should be making it easier, not harder, for scientists and engineers to put roots down in American soil. Other ideas include creating a startup visa for entrepreneurs and excluding advanced graduates in STEM fields from green card caps. Let’s not only invest in tomorrow’s innovation — let’s grow the roster of workers capable of fueling our entrepreneurs to their greatest success.

America is in a global battle for talent. It’s a battle that we have to win. And now’s the time to act.