Immigration and Global Competition: A Snapshot

Courtesy of Caterpillar Inc.

Why reform is critical to U.S. companies competing in the global marketplace

More often than not, the term “immigration reform” brings to the forefront strong opinions about what it actually means—whether people are for or against the issue. For U.S. companies that employ foreign nationals, immigration reform remains a critical need. To put it in perspective: our nation’s immigration laws have not been updated in more than 25 years. Business and technology have changed dramatically since then, yet immigration laws have remained largely untouched. The federal government’s failure to enact substantive immigration reform puts U.S. companies at a disadvantage by reducing the ability to compete with foreign competitors.

Caterpillar supports meaningful immigration reform to help companies remain globally competitive. Why does this matter? Here’s a snapshot of how it affects the business environment, as shared by Mark Peters, senior corporate counsel at Caterpillar.

How does the broken immigration system impact U.S. businesses like Caterpillar?
The last time our nation’s immigration laws were updated was in 1986. Think how much our world has changed since then! Mark Zuckerberg was two years old—no one had a clue what Facebook was—and a cell phone cost $1,300. Our technology has changed dramatically, yet the laws haven’t. The current system puts companies like Caterpillar at a distinct disadvantage in competing with our foreign competition in attracting and retaining world-class STEM talent.

U.S. competitiveness—for that of Caterpillar and other companies—remains dependent on reforming both our education and immigration system. Although manufacturing has created upwards of 70 percent of U.S. engineering jobs, the number of U.S. graduates in the science, technology, engineering and mathematics (STEM) fields has been declining since 2003, creating a huge shortage of U.S.-born engineers, technologists and scientists.

This matters to Caterpillar because we perform more than 85 percent of our R&D in the United States, yet U.S. sales make up about 33 percent of our business. We want to keep those jobs here in the United States, but must fill the gap.

How have you been filling that gap?
We are an American company. We were founded here and we consider the United States home. However, the world is changing and our competition is global. We need access to the world’s best talent working for us—regardless of where they are from. Caterpillar has more than 100 competitors in China alone and they have great access to the engineers we need, without having to recruit from outside their home country.

With the shortage of U.S.-born engineers, we are dependent on foreign nationals that have obtained the necessary STEM skills. Right now, the company has roughly 1,400 employees working in the United States with non-immigrant visas, including 470 employees with H-1B visas, and hundreds of employees who have obtained their green cards through Caterpillar.

Although we train foreign-born scientists and engineers when they come to work at Caterpillar, many cannot stay because of the extremely low H1-B visa allotment—which filled immediately again this year—and because of green card backlogs. So, they take that great education and go back home and work for our competitors.

Our Chairman and CEO Doug Oberhelman explained it well when he attended an Illinois Business Immigration Coalition event recently: “We can’t afford to waste that much economic opportunity. We can’t afford to stand still while the rest of the world moves forward. This is not a red state or a blue state issue. This is a red, white and blue problem that we must solve.”

How can we level the playing field so manufacturers like Caterpillar can compete with foreign companies to attract and retain STEM talent?
We must work to reduce the green card backlog. We also need to create an exemption for foreign nationals working in STEM fields against green card allotments. Here are a few other ways:

  • Repeal the per-country limit on green cards and recapture unused green cards from prior years; 
  • Provide the United States Citizens and Immigration Services (USCIS) with adequate resources to process additional green card filings at an accelerated pace; 
  • Tie the H-1B cap to market demand, as opposed to an arbitrary cap that in no way considers companies’ need to hire new H-1B candidates; and 
  •  Increase the cap—or better yet, eliminate it entirely.

Why should businesses support common-sense immigration reform?

A Wall Street Journal article recently cited some powerful statistics: When a technology company hires a highly-skilled immigrant, an average of five new jobs are created at that company, and even more jobs are created upstream with suppliers. The reality is that increasing the number of available visas and working toward meaningful immigration reform does not take away U.S. jobs, but creates jobs for U.S. workers and is part and parcel with a pro-growth agenda. iBi

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